Airlines in a Crisis

An airline with less than 100 planes in their fleet are at constant risk of being taken over. A tempting proposal for shareholders knowing the risks associated with airline stocks and therefor suceptible to larger airlines wanting to quell sudden upstarts. More than 200 planes and you are becoming a real threat and can no longer hide your size. Unions beome focused and all of a sudden you are coming to the top of size statistics and a sharpened view from the established. Around 200 you are to large for a swept under the carpet buy out and can continue to play the I'm still catching up game without another airline going after every route you try. You are also still a manageable size where a small top managmenet team can have full control on all aspects and a CEO can get into the details and reach out to everyone where necessary. Ryanair have certainly not succeded profit wise with their expnsion. Their profit at 400 was hardly 20% more than when they had 200 planes. And in the m...

Even i a downturn, or a crisis, airlines need to keep looking and preparing for opportunities. An old saying is saving until bust, meaning keeps on saving and shrinking until there is nothing left. In these time airlines like Norwegian should instead of going into complete hibernation mode be constantly looking for opportunities. If pairs of countries open up for travelers from 14 days in the future they should schedule flights between these pairs today and sell them from tomorrow. Specially since all new(ish) routes need to be advertised and sold beforehand to build up a certain load factor even on opening day. Airlines should start by looking at all historical pairings they flew. Even if you home primary country is still restrictive don't mean that other scandinavian, european or world contries are. One should also be looking at expanding and capturing new marketshares from airlines that are more slow movers. Every crisis bring opportunities for they with the wherewithal and ...

One would think a price of 4.50 Nkr for Norwegian shares that with all the new shares values the company higher than when the share was worth 300 Nkr would scare of any buyers. But no. Institutional and experienced share owners sell while small savers buy in and think the share over some years will again rise to the 300. That would in case value the company at more than 9 times the value of Ryanair and probably more than all the other publicly traded airlines in the world combined. Norwegian should take advantage for this surge for the share and expand the share capital again. The last expansion was seriously oversubscribed. It seems like at every turn for some reason the company is issuing seriously fewer new shares than the market could swallow. Except that is for when it decided to force them on bond holders and leasing companies.