Norwegian Group has announced it will open a base at Riga airport ahead of the Summer 2023 season as a "kind of a test" to trial growth outside its core markets in the Nordic countries and Spain.
"We see Riga as an opportunity to do steps outside of the Nordics, but at the same time, we see that Riga and the countries around are actually just an extended part of the Nordics... We have quite a huge office in Riga today as well. So, we see this actually as kind of an extension of the Nordics where we can also use the base in Riga to fly into the Nordics," Chief Executive Geir Karlsen said during the carrier's quarterly earnings call.
Karlsen said the base would initially comprise two aircraft but did not reveal any planned network.
The ch-aviation capacities module shows the Latvian capital is currently dominated by local carrier airBaltic (BT, Riga), which has a 58.7% market share by scheduled weekly capacity. While Norwegian is the third-largest carrier at the airport (also behind Ryanair), its share is a meagre 3.4% (split between the Norwegian and Norwegian Air Sweden AOC).
The airline currently has bases in the Nordics (Bergen, Billund, Oslo Gardermoen, Stavanger, Stockholm Arlanda, Trondheim, Copenhagen Kastrup, and Helsinki Vantaa) and Spain (Alicante, Barcelona El Prat, and Malaga), the ch-aviation PRO airlines module shows.
Norwegian's growth will be fuelled by its ambitious fleet ramp-up programme. The carrier said it secured an additional eleven new B737-8s "at competitive terms" for delivery ahead of the Summer 2024 season, on top of fifteen aircraft of the type signed from AerCap with deliveries by 2023 and fifty ordered directly from Boeing with deliveries between 2025 and 2028. Net of returns of older B737-800s, the airline plans to grow to 82 aircraft in 2023 and to 87 in 2024.
"It's not like we are growing massively, but keep in mind that since last year, we have grown by 40% going from 50 to 70 aircraft. And then through the next 24 months, we are growing by approximately 25%," Karlsen said.
He underlined that Norwegian has scheduled its fleet changes such that new deliveries take place in spring, ahead of the peak season, while phased-out B737-800s head out in autumn, after the end of the busiest period.
The ch-aviation fleets module shows that Norwegian's current fleet comprises forty B737-800s placed with Norwegian Air Shuttle AOC and twenty-eight B737-800s and two B737-8s placed with Norwegian Air Sweden AOC.
Thanks partially to strong demand from business travellers, Norwegian posted a NOK910 million Norwegian kroner (USD88.8 million) net profit in the third quarter of 2022.