(Adds airline and industry comment, flight data)
By Jeffrey Dastin
Dec 2 The U.S. Transportation Department said on
Friday it granted flying rights to Norwegian Air Shuttle ASA's
Irish unit, setting the stage for a new battle among
airlines for leisure travelers across the Atlantic.
The order finalized a tentative ruling the department made
in April and came days after the European Commission formally
filed for arbitration over Norwegian's request, which had
languished for three years.
U.S. airlines and unions have said the subsidiary, Norwegian
Air International, would undermine U.S. wages and working
standards, claims Norwegian has dismissed.
The accusations have come as a fare war has escalated over
the Atlantic, forcing large and established airlines to consider
selling cheaper fares with more restrictions and redesigning
cabins to win budget-conscious travelers back from Norwegian.
"Regardless of our appreciation of the public policy
arguments raised by opponents, we have been advised that the law
and our bilateral obligations leave us no avenue to reject this
application," the U.S. order said.
While Norwegian is already flying to New York and other U.S.
cities, its ability to expand globally has been limited to the
air rights that Norway has negotiated.
Not so for its Irish unit. Ireland is a member of the
European Union unlike Norway, which means an Irish airline can
tap into aviation rights that the European Union has secured.
Friday's news gave Norwegian the chance "to open up a lot
more routes from the U.S. to Europe" and onward to other
destinations, Norwegian spokesman Anders Lindstrom said. The
company now can start U.S.-Ireland service as previously
planned, he said.
"It's going to result in lower airfares," added Charlie
Leocha, chairman of consumer advocacy group Travelers United.
The long-awaited decision may have been slowed by
protectionist rhetoric by candidates during the U.S.
presidential campaign, said Brandon Belford, the Transportation
Department's former deputy assistant secretary for aviation and
There was an outcry Friday by critics.
"It is a betrayal to hundreds of thousands of aviation
workers," Sara Nelson, international president of the
Association of Flight Attendants-CWA, said in a statement.
U.S. Representative Peter DeFazio, ranking member of the
House of Representatives Transportation and Infrastructure
Committee, said he will fight a decision that he believes lets
Norwegian undercut competitors and puts U.S. jobs at risk.
One-way flights on Norwegian across the Atlantic grew 44
percent to 2,916 this year, after increasing 34 percent in 2015,
according to data from air travel intelligence company OAG,
accessed in September.
While top U.S. airlines operate tens of thousands more
flights, they have said budget carriers like Norwegian have
pushed down their trans-Atlantic unit revenue.
American Airlines Group Inc, Delta Air Lines Inc
and United Continental Holdings Inc did not
(Reporting by Jeffrey Dastin in New York; Additional reporting
by Alana Wise; Editing by James Dalgleish and Will Dunham)