Norwegian Air Shuttle is one of the largest low cost carriers (LCCs) in Europe, comprising of both short-haul, intra-Europe operations as well as long-haul routes. It is based in Norway, with a fleet of 100 aircraft including 737s in short-haul service, with A320neo aircraft on order for the future, and 787s in long-haul service. Today, as its international service seeks to grow with continuing 787 deliveries, the airline flies to 126 destinations total across 4 continents. The airline focuses on leisure and tourism routes within Europe, and continues that strategy in its fledgling international operations, flying to cities popular for European tourists, from New York City to Dubai.
What worries the US airline industry about Norwegian is not necessarily that it is growing, but rather how it's going about it.
The prime complaint of American companies and their industry groups, notably ALPA and Airlines for America, is how Norwegian is structuring its business. In addition, they are joined in their opposition by European flag carriers like Air France and Lufthansa. Norwegian has registered its international aircraft in Ireland under its Norwegian Air International, or NAI subsidiary, and is in the process of establishing its air operator certificate in the country as well. In that same vein, its flight crews are evidently to be hired on individual contracts, and hired under Singapore law, skirting Western regulations in what is seen as an effort to drive costs to an absolute minimum. The company plans to do this while continuing to be physically headquartered in Norway.
This strategy of picking countries with ideal regulatory conditions for each individual element of the business angers the Western airline industry, who have labeled it unfair and describe it as instigating a "race to the bottom" for airline business. Norwegian's quest to have the lowest costs, and in turn lowest fares, is of particular concern in the transatlantic market, where American and European major airlines are crying foul the heaviest. Such an entry into the market could potentially bring cost cutting in an already low margin industry to extremes, which aviation professionals see as a threat to employment and livelihood, while others even go so far as to suggest the potential for a considerable impact on aviation safety.
The US Department of Transportation recently denied, albeit temporarily, Norwegian's application for foreign air carrier operation into the US. The DOT essentially acknowledged the inherent complexity and controversial nature of the application and seeks to deliberate further on the issue. In the meantime, ALPA and company continue to lead the charge against the airline, in order to prevent what they see as a major threat to fair business in the particularly lucrative transatlantic market. It remains to be seen where the contentious issue will end up, but many within the industry are certainly waiting anxiously to see where Norwegian's quest for cheap flying goes.
An ALPA press release from its initial efforts to lobby the DOT to reject NAI's application:
http://www.alpa.org/Portals/Alpa/PressRoom/PressReleases/2013/12-17-13_13.68.htm
