Thousands stranded as debt-ridden budget airline Wow collapses
BUDGET airline Wow Air left thousands of passengers stranded yesterday after it collapsed and cancelled all flights.
The Icelandic carrier was still selling tickets just an hour before it went bust early yesterday morning.
It was said to be struggling with debts of £32million and had grounded all flights yesterday as it tried to secure emergency funds from investors.
At 8.18am, the firm announced it had folded – leaving thousands of customers stranded across Europe and the US. In a statement it said: ‘Wow Air has ceased operation. All Wow Air flights have been cancelled.’
The airline connected Europe and North America via Reykjavik, with flights serving Gatwick, Stansted and Edinburgh.
The collapse provoked anger among holidaymakers who had booked to fly with the airline.
At estimated 5,000 American and European passengers were stranded on the wrong side of the Atlantic, while another few thousand were in Iceland.
Hundreds of Britons are thought to have been caught up in the chaos.
Many will be left hundreds of pounds out of pocket having been forced to pay for alternative flights or extra accommodation.
One passenger wrote on Twitter: ‘My girlfriend is gonna miss her grandfather’s funeral because [of] you. I have nothing but deep hate and disrespect for this company.’
Consumer group Which? pointed out that at 7am yesterday – an hour before Wow announced its collapse – it was still selling flights costing more than £1,000 for a family of four from Stansted to Reykjavik.
Rory Boland, travel editor of Which?, said: ‘ Passengers will quite rightly be appalled that Wow Air, was still selling tickets right up to the moment it collapsed, knowing full well that any tickets sold would likely not be worth the paper they are printed on.’
The airline has recently been selling tickets at hugely inflated prices to discourage bookings as it struggled for survival.
A one-way flight from Stansted to Reykjavik was advertised at £756 – compared with £57 for an EasyJet flight flying to the Icelandic capital from Luton on the same day. Similar tactics to deter bookings have been used by other failing airlines, including Monarch in October 2017.
Monarch and Flybmi were both criticised for selling flights right until their collapse.
Airlines battling for survival are worried that if they stop selling flights this will seal their demise as word quickly spreads they have gone bust already. But consumer groups and MPs have argued that selling tickets until the point of collapse is deeply unfair as it leaves more passengers facing hefty losses.
Yesterday passengers also reported police boarding an aircraft as soon as they landed in Baltimore from Paris, while another was seized by bailiffs.
Wow Air was founded by entrepreneur Skuli Mogensen and began flying in 2012.
It offered cheap flights between Europe and North America via its Icelandic hub near Reykjavik. Flights between London and New York were once advertised at £99 each way.
The airline has been involved in negotiations over a potential sale for six months.
It was first in talks with flag-carrier Icelandair and then with US-based private equity firm Indigo Partners, which has stakes in other airlines including Wizz Air. As it struggled for survival, the airline was forced to get rid of four of its planes – reducing its fleet to just 11 aircraft.
Mr Mogensen yesterday wrote a letter to employees which read: ‘I will never forgive myself for not acting sooner.
‘Wow was clearly an incredible airline and we were on the path to do amazing things again.’
It becomes the tenth carrier to go bust in just 18 months, following the collapse of British airline Flybmi, Air Berlin, Cypriot carrier Cobalt and Denmark’s Primera Air.
Flybe was recently rescued by a consortium consisting of Virgin Atlantic, Stobart Group and investment firm Cyrus Capital.
Airlines have struggled with higher fuel costs and fierce competition from bigger budget rivals such as Ryanair and EasyJet.
‘Selling flights just an hour before’