Business | Aviation
Finnair, Norwegian Air in cooperation talks
Deal could help Helsinki-based carrier take market share from rival
- Bloomberg
- Published: 00:00 March 13, 2010
Helsinki: Finnair is seeking an agreement with Norwegian Air Shuttle that would funnel more passengers onto the Helsinki-based carrier's long-haul flights, helping win market share from unprofitable rival SAS Group AB.
The pact would allow Norwegian Air, which has no intercontinental routes of its own, to boost occupancy on Finnair services to nine destinations in Asia.
"We are discussing different forms of cooperation with Norwegian, including the possibility to feed into our Asian traffic," Finnair CEO Mika Vehvilaeinen said in an interview on Thursday. "It sometimes makes sense for other people to fly into our ‘waves' into Asia."
SAS, Finnair's biggest Nordic rival, has reduced its global network after racking up 9.25 billion crowns (Dh33.95 billion) in net losses over the past two years. The tri-national carrier no longer provides long-haul services from Oslo, Norwegian Air's main hub, and offers Asian flights only from Copenhagen.
SAS flights
"This could turn out to be a trigger for SAS to stop its Asian flights," said Jacob Pedersen, an analyst at Sydbank in Aabenraa, Denmark. "SAS's intercontinental business does not have the volume that it should have. Something has to give."
Norwegian Air, Europe's fourth-largest low-cost carrier, is an attractive ally for Finnair after announcing last month that it will begin services to Helsinki from Oslo and Stockholm in April. Founded in 1993, the company has focused on Europe since adopting a discount model in 2001.
"We have an interest in strategic cooperation," Norwegian Air Chief Commercial Officer Daniel Skjeldam said in an interview on Thursday.
"Finnair has been very good at developing a solid long-haul hub in Helsinki and that, combined with our inter-Scandinavian network, could be an interesting set up."
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