British Airways has lost its New York crown to its budget rival, but low-cost long-haul is still a risky business.
The fact that Norwegian has now overtaken British Airways as the biggest non-US airline on transatlantic routes to and from the New York area demonstrates the budget carrier’s move into legacy territory, the news agency Reuters reports.
Norwegian carried 1.67 million passengers to or from New York area airports in the 12-month period to the end of July. That beats the 1.63 million carried by British Airways, according to Port Authority of New York & New Jersey data.
Norwegian has pioneered the low-cost long-haul model on routes between Europe and North America so prized by legacy carriers, and its rapid growth in the transatlantic market in recent five years has even prompted BA owner IAG to try to buy it.
“Fares have been too high for too long, as transatlantic routes have long been dominated by carriers with outdated legacies running on fumes,” a Norwegian spokesman said, adding that it would add a third daily service between London and JFK from October 28.
However, four US airlines, led by United, still dominate international traffic out of New York’s airports JFK, LaGuardia and Newark. Air Canada is biggest among non-US carriers of international passengers, but it flies to the north.
Shake it up
Norwegian, Wow air, Icelandair and others have shaken up the long-haul market, offering fares that can be had for half the costs charged by traditional carriers.
The legacy airlines have kicked back by launching their own budget carriers, such as Level in IAG’s case and Lufthansa with Eurowings, as well as starting to sell or considering launching no-frills ticket classes.
“Our commitment to New York is as strong as ever,” a BA spokeswoman tells Reuters. “We fly up to 70 times a week from all three of our London airports, and we recently announced a $65 million investment on new lounges, improved food, seating and shops at JFK Terminal 7.”
The pace of Norwegian’s advance, going to 1.67 million passengers in the New York region from just 750,000 in July 2017, sits heavily on its finances as it continues to struggle to control costs.