Go Back  PPRuNe Forums > Flight Deck Forums > Rumours & News
Reload this Page >

Hard times for Norwegian

Rumours & News Reporting Points that may affect our jobs or lives as professional pilots. Also, items that may be of interest to professional pilots.

Hard times for Norwegian

Old 17th Apr 2020, 00:19
  #301 (permalink)  

I Have Control
 
Join Date: May 2004
Location: North-West England
Posts: 44
Norwegian are not Norwegian. That name of the airline is deliberately misleading. Perhaps Norwegian will go bust, annul all debts, and rename themselves Welsh. Or Zimbabwean? In any event, the existing company is soon due to go down. I feel very sorry for the employees, but not for the top management who will escape with ill-gotten money. Those times will soon pass, but not soon enough for this airline, with their ridiculous business model. Low cost long-haul. Super cheap short-haul. No way.
RoyHudd is offline  
Old 17th Apr 2020, 13:39
  #302 (permalink)  
 
Join Date: Jul 2013
Location: Never home
Age: 34
Posts: 70
https://www.bloomberg.com/news/artic...o-accept-offer

FRogge is offline  
Old 17th Apr 2020, 14:34
  #303 (permalink)  
 
Join Date: Nov 2007
Location: uk
Age: 52
Posts: 114
Like the article says they have no choice.

They are not investing it’s accept the process or potentially lose everything, if it’s accepted and Norwegian survive they will dump their shares as soon as they can.

Norwegian UK compete directly with British companies, could prove interesting if they ask for and receive a Norwegian government bailout as would that be against completion rules? Such is the convoluted airline business these days.
Icanseeclearly is offline  
Old 17th Apr 2020, 15:14
  #304 (permalink)  
 
Join Date: Mar 2020
Location: Copenhagen
Posts: 11
Originally Posted by RoyHudd View Post
Norwegian are not Norwegian. That name of the airline is deliberately misleading. Perhaps Norwegian will go bust, annul all debts, and rename themselves Welsh. Or Zimbabwean? In any event, the existing company is soon due to go down. I feel very sorry for the employees, but not for the top management who will escape with ill-gotten money. Those times will soon pass, but not soon enough for this airline, with their ridiculous business model. Low cost long-haul. Super cheap short-haul. No way.
What planet do you live on? They were started in Norway, by Norwegians. They are headquartered in Norway. They are listed on the Oslo stock exchange. Seven of the eight members of the board of directors are Norwegian. Their original and largest AOC is Norwegian. Their largest shareholders are Norwegian. The CEO is Norwegian. In what way are they not Norwegian?
ObadiahDogberry is offline  
Old 17th Apr 2020, 16:06
  #305 (permalink)  
 
Join Date: Oct 2004
Location: belgium
Posts: 29
So IKEA is not Swedish because they have entities everywhere and sub companies??? Same goes for Mc Donalds... not ab American company because entities everywhere??? Despite from that who cares???

But what about easyjet and the brexit? Why are they given/ or will they be given approval to fly outside of (not in and out) the UK? They are a UK company.
rotorcloud is offline  
Old 17th Apr 2020, 16:38
  #306 (permalink)  
 
Join Date: Jul 2017
Location: Europe
Posts: 77
Originally Posted by ObadiahDogberry View Post
What planet do you live on? They were started in Norway, by Norwegians. They are headquartered in Norway. They are listed on the Oslo stock exchange. Seven of the eight members of the board of directors are Norwegian. Their original and largest AOC is Norwegian. Their largest shareholders are Norwegian. The CEO is Norwegian. In what way are they not Norwegian?
How many of their employees pay income tax in Norway?
Tommy Gavin is offline  
Old 17th Apr 2020, 18:22
  #307 (permalink)  
 
Join Date: Feb 2011
Location: Europe
Posts: 98
How do you turn debt into shares with no investing at all? Especially now that the company is worth nothing and debt is huge...

I do not get it, maybe someone can explain?
vikdream is offline  
Old 17th Apr 2020, 18:46
  #308 (permalink)  
 
Join Date: Jul 1999
Location: England
Posts: 391
Vikdream. The company is bankrupt and there is no way of repaying the debt holders. The only hope is that new shares are created and swapped for the debt, in the hope that the company survives and the shares gain in value. The debt is eliminated. Shares are sold at some future date salvaging some of the lenders money. As part of the process, the existing shareholders are almost wiped out as to create new shares the original number will be diluted by a large factor. Seen it happen several times, Lost my money but kept my job, until the last crash when everything went! If you canít afford to loose it donít invest!
Capt Scribble is offline  
Old 17th Apr 2020, 20:32
  #309 (permalink)  
 
Join Date: Nov 2011
Location: Somewhere close to me
Posts: 730
Originally Posted by rotorcloud View Post
So IKEA is not Swedish because they have entities everywhere and sub companies??? Same goes for Mc Donalds... not ab American company because entities everywhere??? Despite from that who cares???

But what about easyjet and the brexit? Why are they given/ or will they be given approval to fly outside of (not in and out) the UK? They are a UK company.
The Norwegian pilots outside Norway, don't work for Norwegian, they work for third party companies.
If you work for Ikea or McDonalds, you work for that branch of a company, you are not working for a third party company. How hard is this to understand?
truckflyer is offline  
Old 17th Apr 2020, 20:34
  #310 (permalink)  
 
Join Date: Mar 2018
Location: USA
Posts: 74
Originally Posted by truckflyer View Post
The Norwegian pilots outside Norway, don't work for Norwegian, they work for third party companies.
If you work for Ikea or McDonalds, you work for that branch of a company, you are not working for a third party company. How hard is this to understand?
Ehm nope, but keep trying.
Luke258 is offline  
Old 17th Apr 2020, 20:35
  #311 (permalink)  
 
Join Date: Nov 2011
Location: Somewhere close to me
Posts: 730
Originally Posted by Capt Scribble View Post
Vikdream. The company is bankrupt and there is no way of repaying the debt holders. The only hope is that new shares are created and swapped for the debt, in the hope that the company survives and the shares gain in value. The debt is eliminated. Shares are sold at some future date salvaging some of the lenders money. As part of the process, the existing shareholders are almost wiped out as to create new shares the original number will be diluted by a large factor. Seen it happen several times, Lost my money but kept my job, until the last crash when everything went! If you canít afford to loose it donít invest!
I wonder how many can do this, and so they can borrow more money.
truckflyer is offline  
Old 17th Apr 2020, 21:41
  #312 (permalink)  
 
Join Date: Jul 1999
Location: England
Posts: 391
Truckflyer. It worked for Harriet Green and TCX, but as usual, the management that ejected her went on another borrowing spree until collapse. The next attempt to borrow more failed in spectacular fashion.
Capt Scribble is offline  
Old 17th Apr 2020, 21:42
  #313 (permalink)  
 
Join Date: Oct 2004
Location: belgium
Posts: 29
Dude.... i am working for Norwegian straight away in France with a permanent contract. And guess what... i am happy there and i want us to survive.
rotorcloud is offline  
Old 17th Apr 2020, 22:52
  #314 (permalink)  
 
Join Date: Nov 2002
Location: Dublin
Posts: 651
Whilst we all wish NAS to come through this, the reality is that even if they can plug the gaps now it may be that they fail spectacularly down the line as PAX revenues plummet leaving thousands stranded and huge costs to governments in repatriation . Unless all the pundits are wrong, the view Easyjet and BA have that it could be 9 months before operations return would also apply to NAS. The Irish Times seems to be following the lease situation: https://www.irishtimes.com/topics/to...=Norwegian+Air. In real terms NAS are asking investors to write off their debts on the hope of better returns down wind. The lease companies will still have to pay their financiers and for them this would be a bad deal, on the other hand who wants aircraft back in the middle of a global crisis. NAS is a large player at Gatwick but again the CAA may want to review the financial viability in terms of the AOC requirement and ATOL membership. Looking increasingly like a larger problem for NAS whom really need cash to survive 12 months in the current climate and the Norwegian funding plan is really a finger plaster not a viable solution.
Kirks gusset is offline  
Old 17th Apr 2020, 23:01
  #315 (permalink)  
 
Join Date: Nov 2011
Location: Somewhere close to me
Posts: 730
Originally Posted by rotorcloud View Post
Dude.... i am working for Norwegian straight away in France with a permanent contract. And guess what... i am happy there and i want us to survive.
Is your contract with Norwegian AS? Or with OSM? Or with someone else?

The French furlough agreements are most likely a lot better than most other countries in Europe, but after this there is going to be a price to pay, for many countries. I doubt NAS is paying you at this time while you not working, I am guessing they have left it for the French government to sort out, or am I wrong?
truckflyer is offline  
Old 17th Apr 2020, 23:32
  #316 (permalink)  
 
Join Date: Mar 2018
Location: USA
Posts: 74
Originally Posted by truckflyer View Post
Is your contract with Norwegian AS? Or with OSM? Or with someone else?

The French furlough agreements are most likely a lot better than most other countries in Europe, but after this there is going to be a price to pay, for many countries. I doubt NAS is paying you at this time while you not working, I am guessing they have left it for the French government to sort out, or am I wrong?
The employer is norwegian air france, a local employer. Or how would you imagine a local french contract being Set up? Makes things easier for the employees and the parent Company but I am sure you will find an issue in there too. And yes of course the local government helps, just like in Lufthansa, Air France, British Airways as well. That's what the employees pay Social insurance for. Or do you actually believe that those legacy Airlines are paying the salaries by themselves?
Luke258 is offline  
Old 18th Apr 2020, 07:37
  #317 (permalink)  
 
Join Date: Jan 2008
Location: Europe
Posts: 89
In france, this temporary furlough protection is not on the social security budget, but general state budget. Therefore, an airline which has been successfully at not paying taxes in this country is getting state help without contributing. This applies for other airlines, too.

Good for the crews, though.
fab777 is offline  
Old 18th Apr 2020, 08:38
  #318 (permalink)  
 
Join Date: Mar 2018
Location: USA
Posts: 74
Originally Posted by fab777 View Post
In france, this temporary furlough protection is not on the social security budget, but general state budget. Therefore, an airline which has been successfully at not paying taxes in this country is getting state help without contributing. This applies for other airlines, too.

Good for the crews, though.
How do you even know they weren't paying taxes there? The Crews are paying taxes there as well as Social contributions. Why they shouldnt get anything in return now??
Luke258 is offline  
Old 18th Apr 2020, 08:54
  #319 (permalink)  
 
Join Date: May 2000
Location: SV Marie Celeste
Posts: 632
Come on guys. Use your brain. Norwegian is a Norwegian company listed in the Oslo Stock Exchange with the headquarters in Oslo. The corporate profits are taxed in Norway. The company, like many large companies, has a number of subsidiaries. The employees in those subsidiaries are employed on local contracts and pay their taxes and social security in the local country. Exactly the same as employees in easyJet, IAG, Citibank, Ford, Airbus, etc etc. Local AOCs are not a cost saving issue but a mechanism to gain the right to fly to third countries - ever heard of the Chicago Convention? An airline cannot just choose to fly from a third country to another third country outside the EU just like that. You cannot use the Siberian corridor just like that. Rusia might allow a "Swedish" carrier but not an "Irish" carrier for example.

A crew member is based in London Gatwick and operates from London, where would you expect them to be contracted, in Oslo? where would they pay income tax and social security, In Oslo? of course not. They pay their taxes and SS in the UK as it should be. Their employment is subject to UK law. Much as an easyJet pilot based in Paris pays their tax and is em ployed in France or a Citibank cashier working in Munich in employed in Germany. That is the proper way to do it. Not to be confused with companies that provide an employment contract based in a country nowhere near where the crew member is based with the sole purpose of avoiding labour legislation and tax avoidance - I won't name any names here but how about W and R

Does that mean the company is not Norwegian? of course not. The company headquarters are in Norway and the companies profits are taxed in Norway. Exactly the same setup as every other large corporation out there.

So who should rescue what part? When Ford and GM got into trouble in the last crisis who bailed them out? the US treasury - but they have employees, factories, dealers, etc all over the world? yes but is a US company and the US bailed them out because it considered the economic fallout of letting them go to the wall was higher than the cost of bailing them out. When we had the flood in the UK a few months ago who got government help? just those employed by wholly owned and headquartered UK companies? no - everyone that lived in the affected area. When Honda decides to close a factory in the UK who comes and stumps a pile of cash to try to keep it open? the UK treasury, why? because they want to protect local jobs. So in this case Norway may bail the "company" out but individual countries are bailing the local employees out.

Last edited by calypso; 18th Apr 2020 at 09:13.
calypso is offline  
Old 18th Apr 2020, 09:23
  #320 (permalink)  
 
Join Date: Nov 2002
Location: Dublin
Posts: 651
Indeed, the UK Government is supporting the Employees via the furlough schemes, but they will not inject cash to support the "business" they were happy to let Flybe .The Gatwick airport movement capacity has always been strained and should NAS go then other players will easily take up the slack, of course, Pilots and Cabin crew would be much more difficult to place. Most folks are keeping fingers crossed for NAS but radical changes and realistic reductions in numbers need to occur to place the company on track to at least break even. Unfortunately, once the market and suppliers loose confidenece in a company the rest is "history"
Kirks gusset is offline  

Thread Tools
Search this Thread

Contact Us - Archive - Advertising - Cookie Policy - Privacy Statement - Terms of Service - Do Not Sell My Personal Information -

Copyright © 2021 MH Sub I, LLC dba Internet Brands. All rights reserved. Use of this site indicates your consent to the Terms of Use.