Stein Nilsen:
Oh, when we entered into March 2020, it dropped by 80% overnight and it took five to six weeks to have some demand in the market again. And then, but towards the summer period of 2020, the pandemic eased down a little bit, and we did a very, very good summer season. In fact, the borders were regulated, so a lot of Norwegian people were doing holidays in Norway. And that was one of our best July’s in many decades in Widerøe because of the inbound tourist industry.
So it was a very, very special period, but during September, October, we had of course the second wave of the pandemic, and then we shut down some of that capacity. And I think we flew through Christmas with around 70% of normal capacity compared to 2019.
Jens Flottau:
Which is still a very high compared to some of your other colleagues ing Eropah. So what are your expectations for this summer? A lot of the expectations for Easter, for the Easter period has been disappointing in many parts of Europe. Now it seems a lot of airlines are reporting a strong rebound and demand. Do you experience something similar at Wideroe?
Stein Nilsen:
Still the border of Norway is strictly regulated. There’s a lot of quarantine, rules when you’re passing in and out. So, we are very, very uncertain about the international traffic to and from Norway for the rest of 2021. At the moment we have a drop in international traffic from Norway to other countries of 96%, only 4% of the traffic is left. So of course it’s a very special situation and difficult to do prognosis of what is going to happen to the summer.
But we are very, very convinced that we will have a new strong holiday summer inside of Norway. So in fact, we have expanded our route network with 14 more city pairs, flying between the north part of Norway and the south part of Norway to give our customers a possibility to have holiday in Norway. So we are very, very dynamic and try to launch a good offer to have a summer holiday in Norway.
As for the international traffic, it’s of course, we have a full vaccination ratio still below 20% in Norway and of course that will hold back the demand for the next couple of months. And we don’t think there will be a strong international summer traffic in and out of Norway. So we are preparing to keep the focus on the domestic side of the operation for a couple of months to go.
Jens Flottau:
Yeah. You mentioned the financial support by the, the extra financial support by the Norwegian Government. Was that enough for you to compensate for the additional burdens by COVID and, and how sound is Widerøe financially right now,
Stein Nilsen:
There has been a couple of packages from the government in Norway to support airliners in the Norwegian market. So we have some extraordinary compensation for the PSO, but there has also been a suspension of some of the taxes. The government has even supported both [Vitara salsa, Norwegian 00:10:22], where they guarantee loan guarantee facility. And SAS and Norwegian have used their part of it, and we are still considering it.
But of course this kind of compensation from government it’s not nearly enough to cover for the big loss of demand we have. But Widerøe is in a very, very special situation when the pandemic came in March 2020, we had equity ratio over 30, so we very, very financially stable and robust. So even without that kind of government support we all right, but to take the company through the pandemic and be ready to pick up when the demand picks up, hopefully for the second part of 2021.
Jens Flottau:
Yeah, and even if there is another wave in the next winter, which can’t be ruled out at this stage, right?
Stein Nilsen:
Yeah, and therefore we are also considering using this government supported credit facility to be sure to have enough reserves if we will have a fourth or fifth wave of this pandemic. But that’s more to support for things that we don’t know at the moment, so like an insurance, if you like.
Jens Flottau:
Yeah. Yeah. That makes sense.
I want to just look beyond the pandemic and look at the Norwegian market. There’s been a lot of change to date. Obviously, everyone has read and heard about the difficulties that the Norwegian Wizz Air entered the market and is now about to exit again. How does all of that affect you? I know you’re in a special niche of the market at Wideroe, so maybe not that much, but you can tell us more.
Stein Nilsen:
We, Widerøe, has a very, very special niche, it’s a very special traffic system. And we are flying along the coastline of Norway and between the Northern part of Norway and the West coast in the Southern part of Norway mainly. For the others SES, Norwegian, Wizz Air and, and also [inaudible 00:13:03] coming up. They are very, very focused on the traffic in and out of Oslo. We are not in Oslo – not part of our strategy. But up to now it’s been more or less a battle in the newspapers.
There had been very, very low demand and Norwegian has nearly flown zero capacity. They, I think they have a six or seven aircraft flying at the moment. SAS has cut back a lot of production and Wizz Air was shutting down before the news that they will pull out a lot of their capacity.
So we have been flying 50% PSO and 50% of the commercial business and our market shares through the pandemic has grown. Because of the big production cuts from Norwegian and SAS during the six to eight months we have behind us now. So it has been a very, very strange situation. And I had not in my wildest fantasy imagine that Widerøe should be Europe’s biggest airliner in.
So it’s been a very, very strange situation to be in here in Norway. But of course during such a pandemic, when the demands lower with 80% it’s a big advantage to have smaller aircraft. I think that is the key issue for Widerøe to pick up some market shares during the pandemic. We had the right aircraft size for this kind of crisis.
Jens Flottau:
Yeah. But if you wanted to enter more of the international market and pick up market share there, then you know that wouldn’t be the Dash 8 operation, but more the Embraer 190E2, right. I was going to ask you about the Embraer. I mean you’ve been operating it for two, a little more than two years, two and a half years or so. What’s been the experience so far for Wideroe and how has it been used over the past year?
