Norwegian Airlines has been forced to cancel all international flights and furlough 17,700 employees because of the coronavirus crisis, the travel restrictions and Norwegian Government's refusal to hand over any more money.
The cancellation of international flights will directly affect the entire Scandinavian market as well as Swedish tourists who are resident in Mallorca.
The airline has grounded 15 of its 21 aircraft and its network will be reduced to just 12 domestic routes, all from Oslo.
Sweden is one of the countries most affected and hoteliers in Mallorca are deeply concerned that the disappearance of Norwegian Airlines from the Islands will have a massive negative impact, after the progressive growth in the Swedish market in the last ten years.
It’s not the first time Norwegian has had liquidity problems, but up until now the Norwegian Government has kept it active via various financial loans and the company received 280 million euros in the form of credit guarantees just last month. But the Government has refused to grant any additional aid, arguing that the risk is too high and may affect competition issues.
Hoteliers in Mallorca that operate in the Scandinavian market are confident that competing airlines will operate on Norwegian’s routes, but that will likely depend on the economic impact of the coronavirus pandemic on Nordic countries.
500,000 tourists from Norway, Sweden and Denmark visited the Balearic Islands in 2019, 20.5% less than the previous year and the sharpest decline in the Islands’ emitting markets.