Norway airline plans to sell more aircraft

Norwegian Air expects to announce more sales of aircraft by the end of 2018, including used Boeing 737s as well as some of the new Airbus aircraft that it has ordered, to reduce debt commitments.

Norwegian Air has committed to buy 210 new aircraft from Boeing and Airbus by 2020.

“We have 90 neos (60 A320neos and 30 321LRs) from Airbus on order. The Airbus 320neos are for all practical purposes for sale. We have started a process where we will try to find a new home for those aircraft,” CFO Geir Karlsen said on Tuesday.

“The problem is not to sell them … but to get the price we want…. Hopefully by the end of the year we should be able to disclose news on a transaction,” Karlsen said.

MOVE TO ARGENTINA

By the end of the year, Karlsen estimated Norwegian Air’s fleet of more than 150 aircraft to rise to 164-165. Allowing for planned aircraft sales, he said he expected a net increase in the fleet of 30-40 new Boeing 737 Max aircraft by 2022-2023.

Of its Airbus aircraft on order, 30 of them are Airbus 321LR (long-range) neos, which could be kept, depending on traffic development in Argentina. “We are pretty excited about what we are doing in Argentina, and depending on how that goes we will decide on the solution on the Airbus 321 and will possibly move some of them to Argentina,” Karlsen said.

Norwegian Air started to sell tickets in Argentina on Tuesday on two routes linking Buenos Aires with Cordoba and Mendoza, he said.

The first flight is set down for mid-October and the plan is to have four aircraft in Argentina by year-end.

RENEWAL OF FLEET

“We will look at ticket sales before we decide what to do,” Karlsen said.

Norwegian Air announced the sale of six used aircraft last week and said as many as 140 could be sold over time as part of the renewal of its fleet and to help reduce debt.

Karlsen said sales of used aircraft would continue. Such sales would “probably be sold plus-minus book value as it looks now; hopefully a little bit above”, Karlsen said.