Where did it all go wrong for Norwegian and what now

There is the overambitious expansion and desire to play in the big league with big orders for brand new planes, of several different types no less. But others have gone big and succeeded, but maybe not so much in the airline industry that is plagued with protection from your creditors and financial rescues.

The transition from the enthusiastic well liked entrepenour to the next CEO is important for most companies. It usually happens because the founder have got out of his depth, or simple become to old. In Norwegian Kjos flew a bit too close to the sun . There is also that the airline was built on a belief of continually better market conditions and no savings for a rainy day.

So did they choose an individual with a lot of airline experience and a lot of usefull contacts that could come in with own ideas and change things around from day 1. Not at all. They chose somebody that first spent 3 months learning before he took the reins. And then speculated for another 3 months on how he could turn the airline Norwegian into a chain of convenience shops. The type of business he had experience from. By the time he was ready to make Norwegian planes into flying dill dall shops, 6 months had gone and CoVid19 hit. 

The whole changeover might have gone better if they hadn't changed both Chairman and CEO at the same time, picking a nautical background chairman that didn't understand that airline experience, and preferably from a relevant LCC, was important for the CEO choice.

An airline is not just a collelction of kiosks with a trapped audience. You need to understand the operational side so you can keep a close eye on the costly bits before you expand to the ancilliaries. Even O'Leary was COO of Ryanair before he became CEO. Similar with Walsh.

There is lots of stories coming to light about lost cargo contracts due to poor operational prioritising. Paying for crew that couldn't fly passengers due to lack of training capacity. Overutilizing those crew that was available at huge extra costs, or wetleasing when even that didn't complete the roster. Lack of flexibility in the area of engineering due to lack of inhouse skills and trusting/depending to much on suppliers. There is also the overcomplication of the multiple AOC's and the multi layered leasing and crew recruitment. Simplify first, and if you must only complicate when you can afford it because it takes layers of administration with not so easily quantifiable costs.

It could all be saved by an experienced Chief that could take charge from day 1. It depends though on that investors with knowledge take control and insert just enough money to invest in the business to keep it going but not so much that complacency sets in. Investors that could put together a board with measured ambition and the right contacts, and not just seatwarmers. That could secure it enough financially to let management get on with the business of running an airline to future profit, instead of waisting all their time on finding even more finances and never getting around to the task of closing all of its money gobbling black holes.