Norwegian: Budget Trans-Atlantic Flights to Launch Summer 2014, 787 Dreamliner is Fantastic

Travelling between Europe and the United States is about to get a whole lot cheaper as low-cost carrier Norwegian aims to begin new long-haul services from London's Gatwick airport to three new US destinations beginning in July 2014. 

Transatlantic fares will be available from just under £150 each-way. The carrier will launch service between Gatwick and New York with three weekly flights on July 3 with an introductory one-way fare of £149, while flights to Los Angeles are set to begin on July 2 with a twice-weekly service and introductory fares of £199 each-way. Visitors to Fort Lauderdale will also be able to take advantage of the savings as Norwegian begins a twice weekly service on July 4 with introductory fares as low as £179 one-way. All of the flights will be operated by Norwegian's new Boeing 787 Dreamliner aircraft. 

Norwegian will be the only budget airline flying transatlantic as the carrier aims to take on one of the most competitive markets in the world. The flights offered represent a discount of up to fifty percent over rival fares from legacy carriers at London's Heathrow airport. Norwegian CEO Bjoern Kjos believes that Gatwick is the right market to begin budget transatlantic service. "Gatwick is ideal because we have a lot of feeder flights in and out of there," said Kjos. "Gatwick also has one of the biggest networks in Europe when you take all the EasyJet and Ryanair traffic there. It will give us a lot of transfer traffic opportunities."

The introduction of the Boeing 787 Dreamliner that features a 20 percent savings on fuel burn compared to conventional aircraft has transformed the aviation industry making budget long-haul flights viable. Norwegian is attempting to pioneer the model and has already launched flights to New York and Bangkok from its Scandinavian bases. Budget carriers have attempted to succeed at flying long-haul routes for decades but most gave up with an inability to achieve the necessary cost savings. AirAsia X attempted to conquer the long-haul market between Europe and Asia with the introduction of service from its hub in Kuala Lumpur to Paris Orly and London Gatwick using four-engined Airbus A340 aircraft but cancelled the routes in March 2012. Norwegian is the first carrier to reattempt budget long-haul flights between Europe and Asia with the introduction of its 787 Dreamliner service between Bangkok and its hubs in Stockholm and Oslo earlier this year. 

Norwegian's entry into the long-haul market hasn't been without its fair share of set backs. The carrier's long-haul flights have been hampered by a number of issues including the late delivery of its Dreamliners and repeated breakdowns of the brand new jets which forced the airline to ground one of its aircraft just one month after delivery. Airlines around the world are closely watching Norwegian to see if it can successfully apply a budget business model to long-haul routes that can be sustained in the long-term. In spite of the initial technical lapses, Norwegian's CEO remains confident that the Dreamliner is the right aircraft for the job and claims that the aircraft has already made budget long-haul trips profitable. 

"I think the Dreamliner is going to be a fantastic aircraft. The plane's low operating cost has made it profitable for use on long-haul trips," said Kjos. "We know from the one that has flown very well so far, that it is performing fantastic on fuel burn and passengers love it." Norwegian has said that it is able to operate long-haul flights for thirty percent less than traditional airlines primarily due to the lower operating costs of the Dreamliner and the aircraft's ability to fly for 18 out of 24 hours. "We fly where people fly," said Kjos adding that there is huge demand and competition from Europe to Asia and the United States. The airline will require additional 787 aircraft beyond the eight it has already ordered in order to support its growth in the coming years. "Nothing can substitute a Dreamliner. I'm totally convinced that we made the right decision when we went for the Dreamliner," Kjos said. "Launching long-haul routes between London Gatwick and the United States is also an important part of our strategy to expand internationally and get a stronger foothold in markets outside Scandinavia."

Meanwhile, Norwegian may not be alone in the budget transatlantic market for long. Michael O'Leary, the outspoken boss of Ryanair, has revealed that he is planning 'ten buck' transatlantic flights to the United States. "Ryanair fares across the Atlantic could start from around ten bucks," said O'Leary. "But clearly not all fares would be ten bucks." He added that in 1991, the average Ryanair fares were around £99 but that the airline has since got them down to £18. O'Leary hopes to launch the cheap flights in four years but not until they have the right aircraft in place. He noted that the current price of long-haul aircraft is too high and that there was insufficient availability. Ryanair hopes to break the strangle-hold of legacy carriers like rival British Airways in the highly competitive transatlantic market. 

Norwegian is also planning to compete on its new transatlantic routes with established carriers like British Airways and Virgin Atlantic that generally charge much higher fares but include more amenities and fly out of the more popular London Heathrow Airport. "There's great demand for high-quality flights at a low fare between the UK and the US, particularly to and from Gatwick," said Kjos. "We are looking forward to welcoming many new customers on board our brand new aircraft."

The Chief Executive at Gatwick Airport, Stewart Wingate agrees. "This is one of the most exciting route developments since Gatwick's change of ownership four years ago. It shows the benefits to passengers of Gatwick competing with Heathrow on routes, price, and service," said Wingate. "It gives passengers, once again, real choice about how to get there and importantly, provides options for affordable travel to popular business and leisure destinations. Norwegian's decision to operate high quality services on new long range aircraft offering good-value fares to the US from London Gatwick is a significant industry game-changer." 

Norwegian currently operates 320 weekly flights and 25 routes from London Gatwick airport. The decision to re-establish links from London Gatwick to strategic destinations in North America taking on established rivals in a transatlantic price war is leaving many industry observers curious if such a business model can be sustained where others have failed. Short-haul routes have proved to be profitable for budget low cost carriers where airlines are able to save as much as half the costs compared to traditional airlines. Long-haul routes have proven to be more complicated where fuel is a disproportionately large expense and savings are not as easy to attain.  In addition, passengers on board international flights tend to fly with checked luggage on long-haul routes and demand greater in-flight services cutting further into potential savings. 

But Norwegian has pinned its hopes on modern fuel-efficient aircraft like the 787 Dreamliner hoping that it will ease the challenge. Although the airline's fares only account for the transportation, the airline has designed a package that it hopes will satisfy the demands of international passengers. For an additional £30, the airline will include meals, luggage, and reserved seating. In addition, all passengers will be entitled to use the airline's seat-back in-flight entertainment system for free. Even with the added charge for additional amenities, Norwegian's fares are hard to beat. A routine search of air fares across the Atlantic will show the cheapest flight to London aboard a legacy carrier typically starts at £349.

If Norwegian can prove the low-cost long-haul model to be successful, there is no doubt that more destinations in Asia and the United States will be added in the coming years connecting tourists around the world with popular destinations in Europe.