Scandinavian budget carrier Norwegian argues that the country’s competition regulator is shifting its criteria in its assessment of the airline’s proposed acquisition of regional operator Wideroe.
Norwegian says it “strongly disagrees” with regulator Konkurransetilsynet which, in November, revealed it was considering blocking the acquisition over concerns that competition would be impaired.
According to the budget airline, the regulator stated – two years ago – that two competing airlines are sufficient to ensure adequate competition on a specific route.
“[The regulator] has moved away from these statements,” claims Norwegian, in a formal response to Konkurransetilsynet’s preliminary opinion.
Norwegian says that is not a “close” competitor with Wideroe. Of more than 400 combined routes, only two overlap “in reality”, it insists.
“These routes, which are currently served by three separate airlines, represent below 1% of Norwegian’s annual ticket sales,” it adds.
Norwegian says a third-party assessment by consultancy Charles River Associates indicates that Wideroe’s presence on overlapping routes has “close to no impact” on Norwegian’s fares.
The airline claims the “majority” of documents submitted to the regulator over the proposed tie-up have “not been taken into account”, adding that it has received “strong” support from Wideroe employees, as well as stakeholders and elected officials.
“We view the acquisition of Widerøe as being beneficial for passengers in the domestic travel market in Norway, especially for those passengers travelling on connecting flights,” says Norwegian chief Geir Karlsen.
Konkurransetilsynet has set a 3 January deadline to reach a final conclusion over the acquisition.
Its director general, Tina Soreide, previously said that the tie-up would reduce - from three to two – the number of operators on “several” domestic routes, including Bergen-Stavanger, Bergen-Trondheim, and a number of indirect connections with stopovers in Oslo or Bergen.
Among Konkurransetilsynet’s concerns is that co-ordination of fare pricing could become easier between just two competing operators.
