Tuesday, September 3, 2013

Norwegian Air Shuttle announces new Los Angeles (LAX) service

Budget airline Norwegian Air Shuttle plans to set up bases in New York and Fort Lauderdale next year and will significantly increase services between the Nordics and the US as it receives more Boeing 787 "Dreamliners."

Norwegian, the first budget airline in recent years to offer transatlantic services, will fly to Los Angeles, San Francisco and Orlando in addition to its routes to Fort Lauderdale and New York, chief executive Bjoern Kjos told a news conference on Tuesday.

Norwegian placed Europe's biggest aircraft order last year, 222 planes from Boeing and Airbus. It has been one of Europe's most successful carriers, taking market share from SAS and also moving outside its traditional Nordic market with bases in London and Spain.

It is also one of the most successful stocks on the Oslo bourse with its shares up 105 percent over the past 12 months.

Still, many analysts consider the stock undervalued as it is trading at 7.8 times its expected 2014 earnings, well below an average of around 10 for European peers.

Norwegian launched long-haul services earlier this year when it received the first of eight 787s, and it has recorded a 96 percent load factor on those flights.

The firm says it can operate long-haul flights 30 percent cheaper than traditional airlines, primarily because of the 787's lower operating cost.

(Reuters)

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