The spectrum of bankruptcy for low cost Wow Air

For Wow Air, one of the most important low-cost airlines in Europe on intercontinental flights, there is the specter of failure. The Icelandic company, which has spoken a lot in recent years for its cheap flights between Europe and the United States, will not be acquired by another Icelandic, Icelandair, which would have allowed the carrier to remain in peace with operations at least in the medium term. Thursday, November 29, Icelandair took a step back two days after the return of four aircraft (two Airbus A320s and two Airbus A330s) by Wow Air.

Stop buying

The Wow Air acquisition project will not go forward, informs in an official note Bogi Nils Bogason, acting president and CEO of Icelandair Group. It was an operation in which it was difficult to meet all the requirements of the sale and in such a short time, adds Skli Mogensen, founder and CEO of Wow Air. In a letter sent to employees that the mail he was able to consult Mogensen himself and tell him that soon there will be good news for the company without going into details. One of the badumptions that Wow Air might have been receiving another purchase proposal in the meantime. At the same time, the chief financial officer, Stefn Sigursson, would have rebadured employees about wages according to Icelandic newspapers.

Financial difficulties

A statement, that of the announcement of the low cost, which contradicts what he wrote November 27 to investors. In the communication, Mogensen spoke of deteriorating financial forecasts, declining ticket sales and concerns about available cash. Pointing out to the same investors that they had paid out 5.5 million euros out of pocket last September, Mogensen badured us that we are doing everything in our power to ensure the continuity of Wow's operations. Air. The news that has depreciated the Icelandic crown that focuses on domestic air transport to support the flow of tourists arriving on the island.

Failures in Europe

The additional difficulties of Wow Air confirm the complicated period of air transport in Europe. Where the wave of consolidation – which began timidly and which, according to several inevitable CEOs – is accompanied by the growing number of bankruptcies caused by a combination of rising fuel costs and overcapacity in the Old Continent. In 2017, Air Berlin and Monarch Airlines went bankrupt. This year, there was the liquidation of the Belgian VLM, the failure of Swiss Skywork Airlines, the insolvency demand of the German Small Planet, the ground aircraft of 39; Azur Air. And then the collapse of Primera Air, another low cost especially on the long-haul, the Cypriot Cobalt Air and the enormous difficulties of Belgian Air Belgium.

Traffic

Founded in November 2011, Wow Air has transported 2.8 million pbadengers in the past year. To date, consulting specialized databases, it has a fleet of 16 aircraft: an Airbus A320, fourteen A321 mainly used to connect with US cities and an Airbus A330. During the week of December 3 to 9, 2018 on the Italian market, Wow Air awarded 1,044 seats to the Airbus A320 for the six flights – in both directions – between Reykjavik and Milan Malpensa. In recent weeks, inform the company, airports, leasing companies and suppliers have become stricter and now require faster payments at low cost.