The chairman of the highly influential House Transportation and Infrastructure Committee has called on the Biden administration to deny a new Norwegian low-cost long-haul airline access to the U.S. aviation market. Norse Atlantic Airways hopes to start flying between Oslo, London and Paris to New York, Los Angeles and Miami later this year.
Representative Peter DeFazio argues that Norwegian Air – the predecessor airline to Norse was “imprudently issued” a foreign air carrier permit and that the Department of Transportation should “correct the error of 2016 and deny this airline’s application.”
DeFazio was particularly concerned about Norwegian’s use of contract staff employed through a third-party agency in foreign bases that helped the airline avoid the high employment costs and labour protections in Norway. The long-haul arm of the business was also based in Ireland in order to take advantage of low corporate taxes.
Norwegian suspended its long-haul business last March in response to the pandemic and in January, the airline announced plans to abandon it for good in a last-ditch attempt to survive. Norse Atlantic hopes to fill the void left by Norwegian’s decision to exit the market.
Norse is the brainchild of Bjørn Tore Larsen – a shipping entrepreneur and founder of aviation staff outsourcing company OSM Aviation which used to supply Norwegian with its contract staff. Other key investors include Norwegian founder Bjørn Kjos and his business partner Bjørn Kise.
On Wednesday, Norse began a 1.28 billion-krone ($150 million) share placement to get the airline up and running in time for December 2021. Norse will fly second hand Boeing 787 Dreamliners which Norwegian dumped when they abandoned their long-haul venture.
Norse has already secured the rights to nine ex-Norwegian aircraft and deals on a further three used Dreamliners are close to being signed.
Norwegian faced fierce opposition when it first entered the U.S. market over its decision to use contract staff and in particular foreign crew based in Thailand. The airline responded by setting up U.S. crew bases with flight attendants represented by the Association of Flight Attendants (AFA-CWA).
Earlier this year, Norwegian ended its contract with OSM Aviation and brought all its staff in-house.
Larsen says Norse will also have permanent employees based in the U.S. and will “respect the employees’ right to unionize if they wish to do so,” in an emailed statement to Reuters.
Here we go the congressman wants to impose “Union ” on anyone and everyone the “Vig” is in. By the by in checking he is highly supported by the unions. We have no right to demand that foreign companies belong to the unions as a business owner I can tell you first hand that the real costs of being a union company averages 35% to final product cost. I know that because we paid a lot of money to an accounting company to run real numbers. Sadly the current “theme” in the country is a left turn.
Never did they say Union only, but the opportunity to Unionize should they choose. The point is the US has strict laws against Cabotage, allowing a foreign carrier to operate in the US without either nation ‘s workforce working the flight: in this case you have a carrier based in Norway using a loophole to staff its flights with Thai migrant crews who earn substandard
wages. It’s no different than allowing illegal migrants, ( which Republicans campaigned against), in the Airline Industry! A race to the bottom, hurting American companies and American jobs!