Norwegian Air Shuttle has sold off its Argentinian subsidiary Norwegian Air Argentina (NAA) to Jetsmart Airlines.
Jetsmart will assume the NAA operation with immediate effect. To minimise the impact on passengers, Jetsmart will continue to operate the NAA scheduled flights from Aeroparque airport.
The parties expect that the integration process will take several months, and the Norwegian brand will be phased out in the domestic Argentinian network during this period.
Over the next six months, the three Boeing 737 currently operated by NAA will be replaced by Jetsmart’s Airbus A320 aircraft. The three Boeing 737s will return to service for Norwegian in Europe.
Acting CEO Geir Karlsen said: “We’re taking necessary steps to return to profitability.
“As Norwegian moves from growth to profitability, we are taking all the necessary actions required to ensure that Norwegian is well positioned going forward.
"Over the past few months, we have made important changes to our route network to ensure long-term profitability. Attaining satisfactory profitability for a relatively small domestic operation has proved difficult to achieve, given the overall situation in the country.
“We believe that the agreement we have signed today with Jetsmart secures a significant part of what we have built over these two years; continuity of the network and opportunities. It brings the two newest airlines in Argentina into a stronger combined entity that currently carries about 10% of the domestic market and will become the third-largest operator in the country."
Additional terms and conditions of the transaction will not be disclosed.
Estuardo Ortiz, CEO of Jetsmart, commented: “We are very excited about the opportunity to combine Norwegian Argentina with our current Jetsmart operations. Jetsmart has a long-term commitment to Argentina as well as of our vision of becoming the leading ultra low-cost airline in South America.
"With this transaction, we will continue providing affordable air travel to our customers both from Aeroparque and El Palomar airports."
Norwegian’s employees in NAA will, as per the agreement, be employed by Jetsmart except for the company’s Argentina-based call centre staff. They will continue as Norwegian employees providing customer services to Jetsmart's domestic Argentina operation and to our customers on our long-haul operation between Europe and South America.