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Business

Norwegian Air opens low-cost battle on transatlantic flights

Starting in June, European budget carrier Norwegian Air Shuttle ASA will begin flying single-aisle planes nonstop from the US to Europe, with fares costing less than $100, ramping up pressure on its bigger rivals.

The Oslo-based, low-cost carrier announced Thursday that it was opening new flight crew bases at Rhode Island's T.F. Green Airport and Stewart International Airport in Newburgh, New York, to offer a total of 10 new routes between the United States and Europe.

One-way flights would start at $65 (61.4 euros) for the first 10,000 seats during an introductory phase, with fares on the next pricing tier starting at $99. By comparison, prices for a one-way ticket from New York to Dublin in mid-June with other airlines range from about $655 to $2,755 on the Expedia travel website.

The move is part of Norwegian Air Shuttle's drive to expand its transatlantic services after receiving approval late last year for its Irish subsidiary to operate the routes.

"I pay for what I want, you pay for what you want. We don't pay for what everybody else on the plane wants," Norwegian Air spokesman Anders Lindström said of its fares.

Fierce competition across the Atlantic

Norwegian said it would fly from smaller US airports with lower fees to keep costs low, and use narrow-body Boeing 737-MAX aircraft due to be delivered later this year.

The announcement follows a healthy increase in revenue for the airline last year - rising 16 percent to 26 billion Norwegian crowns ($3.12 billion, 2.95 billion euros), and enabling the carrier to place orders for 260 aircraft from Boeing and Airbus.

Meanwhile, growing low-cost competition on transatlantic flights has shaken up more established rivals. British Airways' owner IAG is planning to start low-cost transatlantic flights from Barcelona this year.

IAG chief executive Willie Walsh said this month that the Norwegian carrier's model had pushed the airline to look at new ways to operate.

Franco-Dutch group Air France-KLM is also pursuing plans for a new low-cost unit, in a project dubbed Boost, while German carrier Lufthansa is expanding long-haul budget flying through its Eurowings business.

Watch video 02:27

Lufthansa under pressure from low-cost competition

uhe/nz (Reuters, AP)

 

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