Ryanair CEO claims Norwegian “will not survive the winter”
“Norwegian will go in four or five months. They are running out of cash. They are scrabbling around daily.”
Michael O’Leary, Ryanair’s CEO, said this in an interview last week with Travel Weekly. The outspoken chief executive of Europe’s largest airline by passengers took aim at his archrival’s global expansion plans: “Norwegian has huge aircraft orders that they don’t have the cash to pay for,” referring to Norwegian’s outstanding order of more than 200 planes.
O’Leary said further that it’s an “open secret” that Norwegian and Monarch, another low cost airline, are in trouble. “They may not survive through the winter.”
Norwegian’s VP of communications Lasse Sandaker-Nielsen said in an email to Dagens Naeringsliv that O’Leary’s comments are nothing but “nonsense”, and that “Norwegian has been profitable for the last ten years”. But markets seem to think otherwise: Norwegian’s stock on the Oslo exchange had dropped by 3,5 percent at 2.40 PM.
The Norwegian airline’s finances have been under strain amidst tightened competition and advanced plans to build up a global low-cost fleet. Managing the company’s finances didn’t get easier this summer, as the company’s longstanding CFO announced his departure.
Ryanair has been in talks with the airline, as it pertains to becoming a feeder airline for Norwegian’s long-haul flights. Here too, O’Leary saw an opportunity to question its rival:
“We are still talking to Norwegian [about connecting flights], but I’m not sure they will still be flying in 12 months.”