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Political wrangling in the U.S. could threaten the Norwegian's aircraft Purchase - reports
Sunday, 18 March 2012
Norwegian
budget airline, Norwegian has announced that it was to make a purchase
of a large number of planes from the USA but the company now fears that
the political wrangling in the USA could affect the aircraft purchase
business.
Norwegian also
fears that Export Credits, one of their sure sources of funding might
slip off their hands. However, there is the feeling that the Norwegian
believes that the Americans have an interest in reaching agreement and
want to push their fears to the background.
There is
currently a high political game in Washington within the export
financing institute, Export-Import Bank, which at worst can lead to the
bank's activities to be closed, at least temporarily.
That may then
mean problems for the Norwegian airline, Norwegian, which is dependent
on export credits to finance the massive aircraft purchase that is
being planned for the coming years, according to business media reports
in Norway on Saturday.
Norwegian
announced in January that it will buy 222 new aircraft over the next
few years, including 122 from the U.S. Boeing, one of the largest
partners of Ex-Im Bank, the Bank generally called. There are also loans
for the purchase of these aircraft which at worst can be threatened.
Republicans in
the lower house of Congress are reluctant namely, to renew the license
and the credit limit to Ex-Im Bank. This is partly due to fear of
default of the loans given to support U.S. export contracts, according
to news agency Reuters.
But Republicans
also want the U.S. to negotiate internationally for a significant
reduction of air transport subsidies, and that it should be examined
carefully whether this type of loan may damage the U.S. companies when
they go to competing foreign companies.
Whether the
bank will survives or not, this is thus creating a situation of
uncertainty for the loans to Norwegian, according to reports.
President
Barack Obama and the Democrats want to raise the ceiling for loans,
Ex-Im can provide for 140 billion US dollars from the current $100
billion, the Bank will soon reach. Unless Congress reaches a
compromise, the bank will have to stop to lend money in May.
But Norwegian
stressed on Saturday that the company does not see any reason to be
worried about in terms of loans for the purchase of American aircraft.
Norwegian particularly points out that for the U.S. politicians it will
be of great interest to reach a solution, because the opposite would be
very negative for the flagship company, Boeing, for example.
“We have no
evidence that the aircraft purchase will be threatened. It's hard to
imagine that Americans will send operators who need new aircraft into
the arms of the Europeans that is Airbus. Remember that export
guarantees are there to support their own country's industry,” writes
Vice President Anne-Sissel Skånvik in a sms to the Norwegian business
daily, Dagens Næringsliv.
By Scancomark.se Team
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