Norwegian Air earnings hit by Boeing 737 Max troubles

The grounding of Boeing’s 737 Max jets will cost Norwegian 500 million Norwegian crowns (£45m), the airline said today.

The budget airline said the uncertainty around the fate of the jets could hurt its plans to return to profitability as it posted a new loss of 1.4bn Norwegian crowns.

Norwegian has been forced to lease other aircraft following the Boeing’s decision to ground its entire fleet of 737 Max aircraft following a fatal accident in Ethiopia last month.

“Due to the uncertainty related to the Max grounding, the company sees an increased risk related to the target of a positive net profit in 2019,” Norwegian said.

The airline did however cut its losses from 46.2m crowns last year, and said costs generally had been reduced.

“I’m pleased with the positive developments this quarter, despite the 737 MAX issues. We have taken a series of initiatives to improve profitability by reducing costs and increasing revenue, “ Norwegian CEO Bjørn Kjos said. “We are optimising our base structure and route network to streamline the operation as well as divesting aircraft, postponing aircraft deliveries and not least implementing our internal cost reduction program, which will boost our financials. I am also pleased that booking figures and overall demand for the coming months look promising.”