WOW Air
The business, the turning points, and the decisions behind them.
01 / WHAT IT BUILT
What the company did
WOW Air was an Icelandic ultra-low-cost airline founded in 2011 by entrepreneur Skuli Mogensen, launching service in 2012. It pursued a transatlantic connecting strategy via Reykjavik, stimulating demand with fares under $200 between Europe, Iceland and the US - growing to 20 aircraft and delivering over a quarter of all visitors to Iceland.
02 / WOW Air FAILURE REASONS
Failure reasons
WOW Air's aggressive expansion collided with a worsening liquidity crunch. After rapid growth, it trimmed routes (cutting Chicago, Los Angeles, Pittsburgh, St Louis and a new Delhi route) and retired three A330s; two leased A321s were impounded in Montreal in March 2019. Rescue talks collapsed one after another: a preliminary agreement with Icelandair Group broke down, Indigo Partners ended talks ongoing since November 2018, a second Icelandair attempt failed on March 24, and bondholder restructuring talks fell apart. On March 28, 2019, WOW Air announced it was ceasing operations - all flights cancelled, thousands of passengers stranded. Iceland's tourism fell 16% as a result.
03 / EVENT HISTORY
Events in the structured record
- Founded
Entrepreneur Skuli Mogensen founds WOW Air in Iceland; the ultra-low-cost airline launches service in 2012.
- Liquidity crunch
Rapid expansion reverses: WOW Air cuts routes and retires aircraft; it enters talks with Icelandair Group and Indigo Partners, which both fail.
- Ceased operations
On March 28, 2019, after the Icelandair and bondholder rescue attempts collapse, WOW Air ceases operations; all flights are cancelled.
04 / CONTEMPORARY REBUILD ASSESSMENT
Difficulty of rebuilding this project today
Material for this section is being gathered and checked. It will appear here once ready.
Overall assessment: Not completed
05 / CAUSAL CHAIN
How the factors connect
- 01
In 2011, Skuli Mogensen founded WOW Air in Iceland, launching ultra-low-cost transatlantic service via Reykjavik in 2012.
- 02
Aggressive expansion gave way to a liquidity crunch in 2018: routes cut, aircraft retired, and rescue talks with Icelandair and Indigo Partners failed.
- 03
On March 28, 2019, WOW Air ceased operations; all flights were cancelled and thousands of passengers were stranded.