Eurowings to Lead the Lufthansa Group's Long-Sought Expansion Into Scandinavia

The Lufthansa Group's budget arm Eurowings is making a play for the Swedish market as the competitive landscape continues to shift in Europe. The move realizes the German group's long-held aim to capture a larger share of the Scandinavian market but comes as other carriers also see opportunities in the region as Norwegian Air and SAS continue to struggle.

From March, Eurowings will offer nonstop service from Stockholm's Arlanda airport and 20 European destinations, including sun runs to Alicante, Faro and Nice, as well as more traditional destinations Berlin, Birmingham and Copenhagen. The airline will initially base 150 crew members and five Airbus A320s at Arlanda.

"We have done our homework and responded quickly to new customer needs and requests," said Eurowings CEO Jens Bischof on Thursday. "We are convinced we will soon also attract many Swedish vacationers and business travelers with our cutting-edge services."

The Lufthansa Group has long had its eye on the Scandinavian market. For years, those overtures took the form of a possible acquisition of SAS and, according to reports in 2016, its integration into Eurowings. Nothing came of those plans with SAS remaining an independent carrier and fellow Star Alliance member.

The crisis, however, has driven a dramatic change in Nordic air service. Norwegian has retrenched to less than half its pre-crisis size with a focus on just its home market. And SAS has removed 30 aircraft from its fleet and accelerated the retirement of its 24 remaining Boeing 737s in favor of A320neo-family jets. These cuts at the region's two largest carriers — plus pandemic travel restrictions — have driven a dramatic decline in available seats on flights to, from and in Swede. Schedules show them down 51 percent in September compared with 2019, and nearly 60 percent for the full year, according to Cirium data. For comparison, European seat capacity is only down 35 percent in September and nearly 48 percent for the year.

Ryanair also sees opportunities in Scandinavia. Europe's largest carrier will open a new base at Stockholm Arlanda with initially two 737s in October. The move comes almost two years after Ryanair closed a base at Stockholm's Skavsta's airport due to the grounding, and resulting delivery delays, of the 737 Max. In July, CEO Michael O'Leary said the pandemic has created the largest growth opportunity in his career for the airline with Sweden one such opportunity where "both SAS and Norwegian are in chaos."

EasyJet, which rebuffed a takeover offer from fellow discounter Wizz Air earlier in September, also has named Sweden — and Scandinavia more broadly — as a place where it plans to invest in a "network of key cities," including opening new bases.

And on the longhaul front, Finnair will connect Stockholm and Los Angeles, Miami, and New York JFK with flights beginning from October to December. The Helsinki-based carrier will operate Airbus A350s on these routes from its new Arlanda base.

Eurowings, like every carrier in Europe, has its work cut out for it. But the airline is ahead of other Lufthansa Group airlines in restructuring and, as a result, is recovering quickly. In August, group CEO Carsten Spohr said Eurowings is already hiring staff again and is likely to recover to — and expand beyond — its pre-crisis fleet ahead of other group airlines.

“Eurowings has a pan-European ambition,” Bischof said in March. Stockholm is Eurowing's second base towards this goal since the crisis began; the first is one in Prague that opens in October.