Norwegian Air Shuttle Warns of Cost Increases as Boeing Delivery Delays Drag On

By Dominic Chopping

Norwegian Air Shuttle said it would prioritize cost-saving measures as a strike at Boeing further delays deliveries of new aircraft.

The low-cost carrier has 50 Boeing 737 Max aircraft on order which had been due for delivery from 2025, but it has previously warned of delivery delays that will hit its growth next year.

Boeing has been building fewer of the jets as it weeds out quality issues after a door plug blew out in midair in January, while it also grapples with supplier shortages that have further slowed production.

Norwegian, which operates a fleet consisting entirely of 737 aircraft, said Friday that deliveries of the new Boeing aircraft would be further delayed due to a continuing strike at the U.S. company. The strike is in its fourth week and more than 30,000 technicians and mechanics have walked out, further affecting an already heavily delayed production schedule.

"This will delay our deliveries well into next summer and increase short-term costs, requiring us to prioritize cost-saving measures," Norwegian Chief Executive Geir Karlsen said.

"We are considering various mitigating actions to overcome the shortage of aircraft, such as lease renewals," Karlsen said.

The airline said it carried 2.26 million passengers in September, up 11% on year, but down from 2.37 million passengers in August.

Overall capacity in September rose 10% on year while traffic increased 12%.

The airline completed its acquisition of regional airline Wideroe in January. In total, Norwegian and Wideroe carried 2.62 million passengers in September, down from 2.71 million in August, it said.

Write to Dominic Chopping at dominic.chopping@wsj.com

(END) Dow Jones Newswires

October 04, 2024 03:20 ET (07:20 GMT)

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