MIAMI – Norwegian low-cost airline Norwegian Air (DY) is arguing in the Irish High Court to repudiate contracts for the supply of new jets. As the carrier has assets registered in both states, the Norwegian airline has obtained protection to avoid bankruptcy in both Norway and Ireland.
Now, in order to emerge from the crisis imposed by the global pandemic, the company aims to emerge with fewer planes and less debt.
Airbus, Boeing Multi-year Deals
With a multi-year deal signed in 2012 that has been overhauled several times, Airbus was to deliver 100 aircraft to DY, but the carrier still has 88 A320neo-family narrow-body jets on order, according to the financial documents of the aircraft manufacturer.
In addition, DY had contractual commitments amounting to US$9.55bn for the delivery of jets by Boeing and Airbus from 2020 to 2027 before the pandemic broke out. However, in June last year, due to the grounding of the Boeing 737 MAX and problems with the 787 DREAM) LINER, DY unilaterally settled its remaining orders with Boeing for the 97 aircraft.
Boeing, on its part, has contested the move and filed unconventional claims against DY.
The Terms of the Order
Brian Kennedy, DY’s attorney said, “We have agreed, judge, in the last short while, the terms of a consent order.” As part of the deadline, Airbus will keep the prepayment portion and will still be owed £600,000 by DY.
Kennedy also said the deal included both DY and its subsidiary Arctic Aviation, though he did not specify the number of aircraft involved.
Featured image: Norwegian’s Boeing 787-9 during landing in Fiumicino Airport. Photo: Andrea Ongaro