Norwegian Air Argentina sold to JetSMART after just 14 months
After just 14 months of operating, Norwegian Air Argentina has thrown in the towel. It has been sold to JetSMART, effective immediately. While the airline’s closure is not a surprise – it was expected a week ago – it will help to shake up the domestic market.
Domestic seats up three million since 2017
With high unemployment and inflation and the significant devaluation of the peso, Argentina was not going to be an easy win. This raises the question of when a new airline should be started. Domestic Argentina has also become a bloodbath for airlines, with 2019 capacity up by almost three million seats over 2017 – after years of relatively static performance. Flybondi was the country’s first LCC, and started nearly a year earlier than Norwegian Air Argentina.
Norwegian Air Argentina’s end shows Group’s determination?
It is easy to question the wisdom of the Norwegian Group starting its Argentine subsidiary when their house was – and is – not in order. But given the continued troubles of the Group, perhaps its impatience is a sign of its determination to cut losses and costs to preserve cash and boost margins, including by finally concentrating on what works. This follows Norwegian’s recent decision to end all long-haul routes from Copenhagen and Stockholm because, as they said, Scandinavia isn’t large enough for mass long-haul service.
Norwegian Air Argentina
With three B737-800s, the mouthful Norwegian Air Argentina operates eight routes in the week of the 4th December 2019. All are domestic, and all are from Aeroparque Jorge Newbery, just two miles from downtown Buenos Aires. Its average frequency is nine-weekly.
JetSMART Argentina lifted off half-a-year after Norwegian Air Argentina. This is a subsidiary of Chile’s ULCC, JetSMART. Its parent is one part of IndiGo Partners’ portfolio. JetSMART Argentina currently has 20 routes, with all but one – Santiago – domestic. Nine routes from Buenos Aires’ Aeropuerto El Palomar, some about 28 kilometres from downtown. It currently operates four 186-seat A320ceos. Its network is markedly different from Norwegian Air Argentina, focusing as it does on connecting across the country.
Although JetSMART Argentina will still be small even after its acquisition, it may help to provide stability, which can only be helpful in the current economic environment. And it should also provide a stronger foundation to compete with Flybondi and Aerolíneas Argentinas. Importantly, it will give JetSMART Argentina access to Buenos Aires’ downtown airport; an advantage that Flybondi doesn’t have.