Norwegian Air Shuttle's attempt to obtain US rights for NAI. Part 2: Traffic impact on competitors

In Part 1 of this CAPA report on Norwegian Air International's application for a US foreign carrier permit, we discussed the policy debate that this has unleashed. We suggested that those opposing NAI were motivated by a desire to raise anti-competitive barriers against a new and more efficient business model.

This second part of our report looks at Norwegian's impact on the incumbents' traffic on its US routes, particularly on the five city pairs where there is at least one direct competitor that is calling on the US Department of Transportation (DOT) to deny NAI's application. Two thirds of Norwegian's US routes, accounting for almost half of its US seats and frequencies, are new markets.

Our analysis of data from OAG Traffic Analyser suggest that, on Norwegian's New York routes from the three Scandinavian capitals, it has both taken traffic from existing participants and stimulated market growth. On London to New York and Los Angeles, its smaller size and a market contraction make its impact less clear, but it is probably also attracting new traffic in addition to starting to take market share.