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The Icelandic airline has huge financial problems. That's why she must now return four Airbus jets to the lessor.
Already in the middle of the current year, things were not going well at Wow Air: the revenues of the low-cost airline increased by a third to reach $ 242 million in the first half. But the loss has further increased: Icelanders lost $ 47.7 million from the beginning of January to the end of June 2018, twice as much as in the same period of the previous year.
Since then, the situation has worsened. When Wow Air announced in September that it would need fresh money for high interest rates, customers became skeptical. They feared to become immobilized and held back their bookings, as recently admitted the company. When competitor Primera Air ceased operations, this effect was exacerbated.
"Restructuring necessary"
This is not everything. Airports, leasing companies and other suppliers have become stricter and now require faster payments from Wow Air. Finally, a planned sale / leaseback transaction has failed. The airline therefore misses essential revenues.
To relax, Wow Air takes drastic action. Icelanders return four aircraft to lessors. They have two Airbus A320s and two A330s delivered, the company Tuesday (November 27) in a message. The move was part of a "necessary restructuring," the airline said.
Uncertainty over the takeover
To survive, Wow Air rescued in early November the arms of his local rival Icelandair. The definitive acquisition agreement has not yet been signed. The planned date of November 30th can not be kept, as Icelandair recognizes this week. You can not fulfill all the terms of the transaction for the moment and continue working on it.
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