The Norwegian government has rejected a proposal that would allow Norway’s low-fare carrier Norwegian Air and other airlines to employ Asian residents on Norwegian-registed aircraft and compensate them with Asian-level pay and benefits, which generally are much lower than Norwegian levels. The decision is a blow to Norwegian Air’s plans for low-cost global expansion.
Norwegian chief executive Bjørn Kjos already had threatened to simply re-register Norwegian’s aircraft in countries that would allow Asian crews on board, to enable his company to compete against Asian low-fare carriers. He told foreign correspondents in Oslo on Tuesday that he couldn’t believe the Norwegian government would be “so stupid” as to risk having Norwegian “flag out” its fleet.
Labour Minister Anniken Huitfeldt proved him wrong, by his criteria, claiming that the government needed to secure Norwegian pay levels and benefits and therefore couldn’t allow airlines to start hiring cheaper foreign crews. She equated the proposal to “social dumping” and refused to “put Norwegian pay and benefit levels into play.”
Kjos was predictably unhappy and claims the government’s position favours the ability of foreign airlines (like THAI or Qatar Airways) to do business over Norwegian’s. He repeated that Huitfeldt’s decision means “we apparently will register some of our planes abroad.”
He said Sweden was a likely alternative but stressed that no specific country of registration had been chosen.