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Norwegian Expands its Reach, Acquiring Widerøe

In an exciting move shaking up the Nordic aviation landscape, Norwegian is set to acquire fellow Norwegian airline Widerøe. Previously a part of the SAS family, Widerøe will maintain its unique identity, with its brand, organization, and Bodø-based head office remaining intact. 

The Implications and Benefits of Norwegian’s Purchase of Widerøe

With Norwegian’s agreement with WF Holding to acquire Widerøe announced on July 6, the dynamics of the Norwegian domestic market could be on the cusp of transformation. This consolidation signals a new chapter in Norwegian aviation, potentially reshaping the competitive landscape.

A strategic alliance that began in 2018 between the two Scandinavian carriers has finally culminated in a takeover. This merger promises to enhance travel prospects within Norway and amplify its international reach.

Boasting more than 40 connections to quaint and bustling airports across Norway, Widerøe’s network dovetails beautifully with Norwegian’s portfolio of over 300 routes spanning 114 destinations in the Nordics and Europe.

“This is a milestone in Norwegian aviation history. We are two Norwegian airlines that have existed side by side for many years, and together, we know the aviation market in Norway incredibly well. Now, we want to create an even better and more holistic offer for all our passengers. We look forward to customers being able to travel easily and flexibly across our route network,” says Geir Karlsen, CEO of Norwegian.

How Would the Purchase Affect Airline Competition in the Region?

Interestingly enough, the overlap between Norwegian and Widerøe’s route maps is minimal. Widerøe operates on 85 routes within Norway, while Norwegian covers 22. Only five routes spark a head-to-head competition between the two airlines.

The acquisition creates an advantage for international travelers, who can seamlessly book flights from far-off lands to the quaintest and most remote Norwegian towns. For those who chase the Aurora Borealis, this could be great news. For domestic Norwegian and Widerøe customers, there’s good in this acquisition news, too. While still benefiting from the Widerøe service they’ve come to expect, they can now seamlessly connect with Norwegian’s more extensive international routes.

Everything changes and stays the same (at least for now).

A Strategic Acquisition for Norwegian Airlines that Respects Widerøe’s History and Legacy

With a rich history dating back to its foundation in 1934, Widerøe stands as Norway’s oldest aviation group. Once a part of the SAS group, it spread its wings independently in 2013. 

Boasting the title of Scandinavia’s largest regional operator, Widerøe flew high, serving over 50 destinations across Norway and Europe, including noteworthy cities like Copenhagen and Billund, before the pandemic grounded its operations. The group, comprised of 3,000 dedicated employees, was a testament to its scale before the crisis hit.

An Essential Air Service Connecting Norway’s Remote Communities

Stationed in Bodø, the Widerøe Group houses a fleet of almost 50 Bombardier Dash turboprops and Embraer jets. The group is a conglomerate of several companies, including Widerøe’s Flyveselskap AS, Widerøe Ground Handling AS, Widerøe Technical Services AS, Widerøe Property AS, and Widerøe Asset AS.

The regional carrier commands close to 20 percent market share in Norway’s domestic air travel scene, determined by the number of passengers. 

Widerøe’s routes are categorized into three main types: Public Service Obligation (PSO), Regional, and International. 

PSO routes are typically short, challenging, and serviced by smaller, turbo-propelled aircraft. These routes are dictated by government demand and are generally less efficient due to their focus on smaller markets. The government procures these services through tenders, specifying minimum frequency and maximum ticket prices. 

The latest government tender was issued on April 27, 2023, with services expected to commence in April 2024 and run until October 2028. The government has increased seat capacity requirements and reduced maximum ticket prices to enhance regional offerings and infrastructure. 

Regional routes offer a blend of small and medium-sized airports and are serviced by both turbo-propelled and jet aircraft. On the other hand, international routes are selective, operating mainly from larger domestic airports and mostly during the summer period. 

Fleet and Operations

At the heart of Widerøe’s operations lies a fleet of 45 turbo-propelled Bombardier Dash 8 aircraft, including four on order. The airline also operates three Embraer E190-E2 jets. The Bombardier Dash 8 aircraft, specifically designed for short and steep approach runways, are a valuable asset to Widerøe. 

Widerøe also boasts a ground handling operation, Widerøe Ground Handling AS, offering full services at over 40 Norwegian airports. The carrier also owns a broad range of properties, including garages, hangars, parking and operations facilities, and cargo buildings.

A 90-Year History

“Widerøe has a nearly 90-year history, and we are the guarantor of a functioning route network in District Norway. Although we have a solid footprint in Norway, we are smaller in an international context. A very high level of Norwegian taxes combined with fierce international competition makes it difficult for a small, regional airline to manage without a strong partner,” says Stein Nilsen, CEO of Widerøe. “We are therefore very happy that we have found together with Norwegian, and that we are getting an industrial owner who wants to develop the companies going forward. We are convinced that this solution is the best for Widerøe, our employees and not least for our customers.” 

Organizational Structures Will Remain Intact

Both Norwegian and Widerøe are expected to maintain their current organizational structures post-purchase. Widerøe’s existing collaborations with other airlines will remain intact and operational. 

“The agreement will ensure an even better route offer for passengers, with the organization of a more efficient operation, which in turn lays the foundation for a strong Norwegian aviation industry with Norwegian jobs and decent working conditions. Together with Norwegian tourism companies, the two companies can have greater opportunities to develop Norwegian tourism. We want to ensure that all passengers get a comprehensive solution with, among other things, our attractive Norwegian Reward loyalty program,” says Geir Karlsen.

Change to Widerøe’s Loyalty Program

One exception, as reported by (article in Danish/paywall), is that Widerøe is expected to end its participation in the SAS Eurobonus mileage program following Norwegian’s acquisition. However, their participation in this program was already dwindling. 

During the pandemic, SAS has canceled most of the agreements,” says Widerøe’s CEO. The regional carrier has a close history with SAS. It was either wholly or partially owned by the Scandinavian carrier from 1969 to 2016.   

Norwegian is expected to pay 1,125 million Norwegian Kroner for Widerøe, which is around US$106 million being exchanged in this deal.

Closing of the transaction is expected by the end of the fourth quarter of 2023 and is subject to certain conditions, including a regulatory review process from the Norwegian Competition Authorities. 

Will Norwegian Inherit Widerøe Zero’s Paris Air Show Deal with Eve Air Mobility?   

If Norwegian keeps the Widerøe organization intact, they might soon own a fleet of Embraer’s Eve eVTOL aircraft. 

At the opening of this year’s Paris Air Show on June 19, Widerøe Zero and Eve Air Mobility signed a letter of intent. It covers up to 50 electric vertical take-off and landing (eVTOL) aircraft, intending to launch in Scandinavia.

Earlier this spring, Widerøe Zero was awarded research funds to find operational concepts for a nine-seater and helicopter aircraft (eVTOL). The extended collaboration with Eve will accelerate this research and examine whether such a concept would suit Norway. This type of aircraft will be able to connect the smaller island communities with the nearby cities. It will, therefore, be an effective alternative to other transport forms. The aircraft type will also not depend on as much infrastructure as the larger aircraft.

“We look forward to an even closer collaboration with Eve in the coming years,” says Andreas Aks, managing director of Widerøe Zero AS.  “This type of helicopter would be a good additional option, especially to and from smaller island communities with limited transport options.”

Eve aims for the eVTOL aircraft to be ready and certified for passenger traffic as early as 2027. This type of aircraft might make service to remote locations and serving fewer passengers more sustainable. However, this is only one of several concepts Widerøe Zero is exploring. In parallel with the Eve collaboration, they are also working to find a suitable alternative for zero-emission aircraft. They aim for aircraft that can serve the Norwegian short-haul network for Widerøes Flyveselskap.

The agreement also includes a service and operation package and the implementation of Eve’s Urban Air Traffic Management software solution.

“The extended partnership builds on a previous agreement signed between Eve and Widerøe Zero in 2021 at the UN climate conference (COP26),” which aimed to develop Urban Air Mobility operations in Scandinavia, says Andre Stein, Co-CEO of Eve. “This additional letter of intent reinforces our commitment to introduce sustainable, safe and affordable city flights to the regions. Together, we will drive the green shift and lay the foundations for a more accessible transport system for Scandinavian communities.”

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