The airline may also reconsider plans to locate its long-haul
operations in Ireland, giving up the advantage of having a European
Union-based carrier, Kjos told Irish transport minister Leo Varadkar
in a letter dated April 23.
Norwegian launched flights to the U.S. and Bangkok from its Nordic
bases last year and obtained an Irish air operators' certificate,
hoping to base the business in the EU, where it can operate under
more favorable conditions and take advantage of the Open Skies trade
between the U.S. and the EU.
Norwegian is operating its flights to the U.S. under a temporary
permit issued by the government in Oslo.
Its application to the U.S. Department of Transportation for a
permanent license, made via Norwegian's Irish affiliate, has been
fiercely contested by its rivals and by unions.
They argue that Norwegian is simply trying to escape high Nordic
labor costs and wants to employ cheap Thai crew, gaining an unfair
"Unfortunately, the delay in the DOT process has given us no other
choice than to put our ongoing negotiations with Boeing to purchase
20 new 787-9 Dreamliner aircraft — due to be registered in Ireland — on hold until Norwegian Air International's future in the U.S. has
been decided," Kjos said in the letter seen by Reuters on Monday.
"An additional delay — or in the worst case, a negative decision by
the U.S. DOT — may regrettably force us to reverse our commitment to
build an international long-haul airline in Ireland."
[to top of second column]
Norwegian has been expanding at breakneck pace in recent years and
has more than 200 aircraft on order. It is opening bases across
Europe and plans to take on one of the most competitive markets this
summer, launching long-haul flights between London and New York.
If it left Ireland, where its long-haul planes are registered, it
would rebase them in Norway, where it has a permit to operate, Kjos
The firm already has commitments to buy or lease 14 Dreamliners but
it has been looking for additional planes, because it consumes 20
percent less fuel than older jets, giving the firm a cost advantage.
The 20 new Dreamliners have a combined list price of $5 billion.
Norwegian shares fell on news of Kjos's comments but later recovered
some ground, trading 0.5 percent lower at 1421 GMT, lagging a 0.1
percent gain in the broader market <.OSEBX>.
(Editing by Balazs Koranyi, John Stonestreet)
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