Norwegian subsidiaries file for bankruptcy: is this the beginning of the end?

Norwegian’s Danish and Swedish Air Crew employment subsidiaries, which legally hire and manage the staff for the airline have filed for bankruptcy.

On top of that, and even more worrying, Norwegian has cancelled provision agreements with contractors OSM Aviation, who supply crew to the airline in the UK, Spain, United States, Finland and Sweden. 1,571 pilots and 3,134 cabin crew will be affected by the measures, including the bankruptcies. Only around 700 pilots and 1,300 cabin crew remain unaffected. These employees are based in Norway, France and Italy. Norway is the only country that might aid it, France and Italy have immensely complicated and expensive redundancy laws, and have offered employment support packages. The UK has offered similar support packages, but its much easier to let people go with minimal payments.

Norwegian admitted today that neither the Danish or Swedish governments had been prepared to offer financial aid to the airline, whose labyrinthine structure and multiple subsidiaries may have shielded it from tax and other legal provisions in international flying, but have immensely complicated any willingness to aid it as it’s convoluted and opaque structure has hidden so much from view.

Is the end near? Quite possibly, but what I suspect will happen is that all of the non-Norwegian businesses will be wound up, a restructure launched, basing the whole company in Norway in a greatly reduced size.