Norwegian fares flop

BANGKOK, 14 June 2013: The first ever long-haul, low-cost flights between Bangkok and Europe were introduced by Oslo-based Norwegian, earlier this month.

Without any fanfare, the airline started flights from Bangkok’s Suvarnabhumi Airport to Oslo, 2 June, shortly after commencing its first long-haul service from Stockholm to New York.

The only other long-haul, low-cost airline operating in Southeast Asia is AirAsiaX from its base in Kuala Lumpur and serving points in Australia.

Norwegian is the third largest discount airline in Europe.

According to the airline’s communications department all sales in Bangkok are through its website, excluding the travel agency channel entirely.

It is unlikely that many seats will be available on the Bangkok-Oslo sector as most of the bookings will be roundtrip travel by Norwegians visiting Thailand on holiday.

Norwegian’s entry into the Bangkok market was about as quiet as it could be – no local daily newspaper reports, no welcome party or introduction to local travel agents. Possibly, no bouquet of flowers  from Suvarnanbhumi Airport’s management.

For a new airline on the block, a browse around the website is not reassuring for potential customers in Southeast Asia. Site visitors unfamiliar with the airline’s web content are more likely to browse and drop out claiming there is not enough background information on the new service to make a booking decision. Or they are not confident about the airline’s credentials.

TTR Weekly checked the site for flight details ex-Bangkok – how many flights weekly, days of the week and does the service stop first in Stockholm or Oslo? It serves both destinations and the website assumes passengers know the details. It flies just three times a week, but that simple fact does not jump off the page to grab your attention.

Once on the website it is about hit-or-miss clicks. You choose a date and if the content box remains blank click on the next day button. It wastes time and it would be more convenient if the airline stated days and weekly frequencies in an info box that appears when you identify a route, especially if it is a new one.

It takes a little time to work out that all services from Bangkok go to Oslo where there are connections to other destinations; the main ones being Stockholm and Copenhagen for Asian travellers.

This is not entirely clear to a casual browser, who could go through the booking steps without knowing the Bangkok-Stockholm services requires a change of plane in Oslo and a wait of around one to three hours. (Grey fare content boxes have tiny icons to indicate if the flight is direct or with a stop).

Flights depart Bangkok 0900 arriving in Oslo 1545 with a flight time of 11 hours and 15 minutes. (Flight DY7202). If Stockholm is the final destination it requires a change of plane (DY824) and a wait of 2 hours and 45 minutes. Factor in a downtime snack at the airport of at least Euro50 on top of the fare. Oslo is notoriously expensive.

The return flight, ex-Oslo, departs 1450 and arrives in Bangkok at 0650 the following day. Flight time is 11 hours. (DY7201). If you start the journey in Stockholm you will need to leave at 1220 (DY813) to Oslo and wait 1 hour and 30 minutes to connect with the flight to Bangkok

The airline is economical with information so it comes as no surprise to potential passengers that the long-haul flight to and from Bangkok is not on Norwegian at all. The flight is operated by HiFly, a wet-lease aircraft company based in Lisbon, Portugal.

Do you look for HIFly or Norwegian on the Suvarnabhumi Airport flight departure screens?

HiFly is serving the route with its own A340 with a wet leased cockpit crew and Thai cabin attendants supplied by Norwegian. The arrangement, reflected in the four digit flight code, continues until Norwegian takes delivery of its Boeing Dreamliners.

Fare-wise the airline needs to do more homework to give us really cool fares. Its best economy fare, out 16 July and back 31 July (Bangkok-Oslo-Bangkok) was Euro 836.30 including 34.60 in tax and a fuel surcharge of 95.60.

In Thai baht that is approximately Bt33,452, hardly a bargain when you factor in around Bt4,500 for 20 kg of checked-in luggage and the cost of two “ tasty meals.”

The roundtrip fare Bangkok-Stockholm is Euro 990.60 (Bt39,624). Again you need to add the extras at around Bt4,500 to compare with full-service airlines.

Premium class comes with leather seats and meals and those extras put the roundtrip fare up to around Euro 1,360.80 (Bt54,432).

There are better deals for the summer months. Finnair teases us with a Bt28,500 roundtrip fare to Oslo advertised on its website. However, availability is limited. Also the travel period runs from 26 August to 23 November.  Three attempts to get the super low fare failed. The nearest was Bt35,135, one-stop and a change of planes in Helsinki.

Qatar has a Bt33,620 fare roundtrip Bangkok-Oslo including luggage and meals, but it comes with quite a long ground stop in Abu Dhabi to connect to the Oslo service.

SAS sells its Oslo service at Bt44,420 with a change of plane in Copenhagen. That compares with Finnair’s run of the mill fare of Bt40,795, quite easy to secure.

Admittedly, Norwegian’s fare is among the cheapest but given the lack of flexibility and add-on fees, long-haul travel on a low-cost airline is a hard sell in Asia.

The fares are just not low enough to prompt and exclamation; “Wow, cannot miss that.”

Norwegian will have to work considerably harder on its basement fares like matching Finnair’s Bt28,500 deal, but making it bookable. That would do the trick.

Business bytes

Established in 1993 as a regional airline it evolved into the low-cost Norwegian ASA listed on the Oslo stock exchange in 2002 serving destinations in Europe.

It carried 17.7 million passengers last year.

The three weekly services to Bangkok will cater mainly to Norwegians heading for beach resorts in Thailand, but the airline said it was establishing Bangkok as base to capture a share of the growing outbound market from Southeast Asia.

Flights are handled by Bangkok Flight Services a company partly owned by Bangkok Airways. Thai cabin attendants have been recruited here in Bangkok.

The airline is Europe’s third-biggest discount airline with 68 aircraft in the fleet and 279 aircraft on order.

It started twice weekly services to New York’s John F. Kennedy Airport from both Oslo and Stockholm, last May, using an Airbus A340 until it can take delivery of Dreamliners later this year.

Chief executive officer, Bjorn Kjos, told Bloomberg recently  that the airline’s website crashed due to the volume of bookings made for the New York flights and later claimed flights to Bangkok were already packed.

The carrier will offer a third weekly New York flight from Oslo and Stockholm later this month.

In an email message to TTR Weekly, the airline’s communications department said it would rely entirely on website bookings to tap the Asian market.

There are no plans to hire a general sales agency or work through retail agents in Bangkok, although in Norway the airline sells through retail agents who can book tickets for clients on Amadeus and Travelport.

A Bangkok crew-base allows Norwegian to serve European destinations and compete in the future with Asian competitors by employing Thai cabin attendants who are willing to work for less than Scandinavian cabin crews.

However, the move prompted heavy criticism in the airline’s home market that is feeling the unemployment pinch. Critics said they feared cabin crews on a Norwegian flight may not be able to communicate in a Scandinavian language.

However, the airline’s CEO told Bloomberg, Asian travellers, especially those from China, are likely to account for 90% of tickets between the Far East and Europe within 15 years.

“That will swing the dynamics of long-haul demand toward leisure travel, favouring low-cost operators and meaning that airlines will themselves need to be increasingly international,” Kjos said.

The airline has eight Boeing Dreamliners on order, but until the first is delivered later this year, it has a wet lease contract with HiFly to fly A340s on its two long-haul routes – New York and Bangkok.

The airline ‘s Boeing 737-800s fleet serves 121 destinations. In 2012 alone, it added 52 new destinations in Europe marking the start of a major expansion that covers 121 destinations and 359 routes.

Sourced: ttrweekly