O’Leary claims Norwegian Air ‘running out of cash’

O’Leary claims Norwegian Air ‘running out of cash’

Ryanair boss Michael O’Leary has claimed rival Norwegian Air is in financial trouble and may not survive the winter.

O’Leary told journalists in London: “Norwegian will go in four or five months. They are running out of cash. They are scrabbling around daily.”

Norwegian denied it is in difficulty, with a spokesman insisting the Ryanair chief executive’s comments “have no root in reality.”

However, O’Leary said: “Both Monarch and Norwegian are in trouble. It’s an open secret among airlines that Monarch and Norwegian may not survive through the winter. They are burning cash.

“Norwegian has huge aircraft orders that they don’t have the cash to pay for.”

Ryanair has been in talks with Norwegian for months on offering connecting flights to its long-haul services, and is a member of airline lobby group Airlines for Europe (A4E) alongside Norwegian.

O’Leary said: “We are still talking to Norwegian [about connecting flights], but I’m not sure they will still be flying in 12 months.”

A Norwegian spokesman told Travel Weekly: “Norwegian has been profitable for the last 10 years, with a strong liquidity, together with owning a substantial share of Bank Norwegian which has a market value of over £1.6 billion (NOK17 billion).”

Monarch chief executive Andrew Swaffield also recently rejected suggestions that Monarch is in trouble.

Swaffield attributed Monarch’s latest losses to writing off the costs of the airline’s current lease arrangements, describing it as “the last legacy of the old Monarch”.

O’Leary also questioned the independent survival of easyJet and Wizz as he forecast substantial consolidation among Europe’s airlines.

He said: “You’ll see four to five airlines emerge over the next four to five years

“I see the British Airways family [IAG], Lufthansa, Air France-KLM and Ryanair emerging, and possibly easyJet as well.”

However, he said: “I doubt easyJet will be independent in five years. They will probably merge with IAG or Air France.”

O’Leary claimed: “EassyJet struggle to compete with us on price and increasingly we’re moving in on their airports.

“Can they continue to grow? No. There is a 50/50 chance they will merge.”

He also suggested Wizz would struggle, saying: “Wizz is a niche player. It will get pushed out of the way as we move more into Eastern Europe. Probably it will get swallowed by Lufthansa.”

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