Norwegian Air has revealed today “an agreement in principle” with Boeing for a recommitment to purchase 50 Boeing 737 MAX 8 aircraft, which also includes the option for an additional 30 aircraft.
The 50 aircraft are due to be delivered between 2025 and 2028, at a schedule closely corresponding to current aircraft lease expirations.
The agreement in principle is subject to various closing conditions, which are targeted to be concluded by the end of June 2022.
The company said that it intends to finance the outstanding balance of pre-delivery payments through positive cash flow from operating activities.
Norwegian Air also said that a “significant share” of the aircraft will be owned by the company, ensuring an “optimised and balanced aircraft financing structure”.
Subsequent to the conclusion of these agreements, Norwegian estimates to record a net gain of approximately NOK 2 billion.
Svein Harald Øygard, Chair of the Board of Norwegian, said: “This is a landmark deal that sets out a path whereby Norwegian will own a large share of its fleet.
“This will result in lower all-in costs and increased financial robustness, enabling us to further solidify our Nordic stronghold.
“The deal also allows us to serve our customers with state-of-the-art aircraft that can run increasingly on sustainable aviation fuel.”
The Boeing 737 MAX 8 is approximately 14 per cent more fuel-efficient compared to the previous-generation aircraft.
This gives the company a “strong footing” to achieve its target of reducing emissions by 45 per cent by 2030.
Geir Karlsen, CEO of Norwegian, said: “The overall terms achieved are attractive for Norwegian, and the deal fits well with our long-term fleet strategy and route program.
“It will enable us to serve our customers with modern fuel-efficient aircraft with the latest technology, significantly reducing our carbon footprint.
“The deal will also strengthen the company’s equity considerably, further solidifying Norwegian’s financial position.”
For more information, please visit norwegian.com.
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