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Monday, June 17, 2024

State may halt airline merger

Norwegian authorities still fear that Norwegian Air’s proposed acquisition of short-haul carrier Widerøe will weaken competition within Norway’s airline industry. They announced on Friday that they’re evaluating whether to forbid the acquisition, and gave both airlines until December 8 to respond.

Norwegian Air and Widerøe currently compete against each other on routes between Bergen and Stavanger, for example, and between Bergen and Trondheim. Norway’s competition authority (Konkurransetilsynet) is thus worried that airfares will rise and departures will decline.

“The aviation market is important for Norwegian consumers,” said the leader of the competition authority Tina Søreide. “The acquisition means we’d go from three players to two on several domestic routes. We think there is a real risk that competition will decline, leading to higher ticket prices and poorer service for Norwegian airline passengers.” She said it could also become easier for the two remaining airlines to “coordinate” fares on other domestic routes, and contribute to more expensive ground services at airports in Evenes (Harstad-Narvik), Alta and Kirkenes.

Officials at both Norwegian Air and Widerøe said they were “surprised and disappointed” by the authority’s preliminary evaluation and would carry on their efforts to merge. “Widerøe is very positive about having Norwegian as its new owner,” a Widerøe spokeswoman told state broadcaster NRK. staff



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