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October 22, 2014

Foxx Rejects Norwegian Air International’s Interim Request for Low-Cost Transatlantic Service

Handing at least a temporary victory to organized labor, Secretary of Transportation Anthony Foxx on Tuesday rejected Norwegian Air International’s request for short-term permission to fly low-cost flights between European and U.S. airports.

In an order dismissing the airline’s request for an exemption that would he allowed the flights to begin, Foxx said that because of the large volume of comments from interests ranging from U.S. airlines to regional airports, “which reflects the novel and complex nature of this case” a temporary exemption was not “appropriate or in the public interest.”

Foxx’s order said the Transportation Department would continue to consider Norwegian Air International’s application for a foreign air carrier permit. If granted, that would open the door to permanent service by the cut-rate carrier.

Organized labor vehemently opposes Norwegian Air International’s application because the carrier would use non-union pilots and crew from a staffing agency in Singapore.

The carrier said in its application that it would “offer the American public competitive fares, award-winning service that is responsive to market preferences and demand, increased service to previously underserved markets, and support for the U.S. aviation industry through its multibillion-dollar commitment to Boeing” by purchasing new planes.

Travel groups and some U.S. airports such as the Fort Lauderdale-Hollywood International Airport in Florida supported the Norwegian carrier.

“NAI’s new low-cost transatlantic service, if approved, would increase inbound international travel, boost U.S. exports, and provide new ladders of opportunity for Americans by creating travel jobs,” said the U.S. Travel Association’s filing with the Federal Aviation Administration.

But major U.S. and foreign airlines opposed the Norwegian carrier’s request.

And labor unions said the proposed flights would violate the terms of an agreement between the European Union and the United States on commercial air service.

In an interview last week, Edward Wytkind, president of the Transportation Trades Department at the AFL-CIO labor confederation, said, “This is a big deal. This is an important legacy issue for the Obama administration.”

If the Obama administration denies Norwegian Air International’s request, it would be “remembered as the administration that stood strong in favor of a strong U.S. airline industry,” Wytkind said.

If the Norwegian Air International service were allowed in the U.S. market, “it would put a downward pressure on wages and benefits” because U.S. carriers would be competing with pilots and flight attendants “that don’t earn the kind of pay that Americans and European make and get the benefits they get.”

He added, “The concern would be down the road that this business model would be one” that other airlines “may try to embrace.”

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