European airline ceases operations, cancelling all flights and leaving passengers stranded

Toronto, Canada - August 08, 2008: Passengers wait for a flight inside Pearson International airport in Toronto Canada.
By Alexandra Coulton


Icelandic low-cost carrier Wow Air has ceased operations and cancelled all flights.

The announcement comes after a buyout from rival airline Icelandair fell through, with talks between the two companies ending on Sunday.

The airline has advised passengers should check available flights with other airlines and keep an eye out for “so-called rescue fairs” and advised passengers who paid with a credit card should check with their credit card company to check whether a refund of the ticket cost will be issued.

“Passengers who bought their ticket from a European travel agent (within the European Economic Area) as a part of a package tour (a package which includes flights and accommodation or other services) are protected by the Package Travel Directive,” the statement said.

“Those passengers are advised to contact their travel agent to arrange an alternative flight.”

Wow Air also indicated passengers may be entitled to compensation in accordance with European regulation on air passenger rights and advised passengers to file claims with the administrator/liquidator.

Ralph Hollister, associate travel and tourism analyst at GlobalData, said the closure of smaller airlines such as Wow Air comes as little surprise.

“Even major airlines such as Ryanair with significantly higher profit margins are suffering with the issues at the root of these closures – high fuel prices and overcapacity,” he said.

“With finances having already been in decline for a number of months, Wow had to reduce its fleet from 24 to 11, along with reducing the number of destinations available to customers.

Hollister advises smaller airlines need to be more sensitive to changes in the market and be one step ahead of increases and decreases in demand for specific routes.

“This will decrease the amount of empty seats and most importantly, keep them afloat in a highly competitive industry.”

Wow Air ran both short and long-haul flights between Iceland, Europe and North America.

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