A few weeks ago I wrote about how a group of American investors intended to purchase WOW Air’s assets, following the carrier’s collapse in March 2019.
Rather oddly they’re not even the only party looking to launch a similar airline in Iceland, as some former WOW Air executives had a similar plan to launch an airline this fall.
WOW Air failed for a reason, and she had a plan for making an airline like this work… or so she thought. As it was explained in an interview:
- She saw opportunities in the freight market between Iceland and the US, and planned to operate two freight-only Airbus jets as part of the carrier’s fleet
- She hoped to start the passenger side of the operation with three planes, and expand it to as many as 12 planes within two years
- The company already had ~$86 million in working capital
- In order to save costs, the company would not ferry staff between Reykjavik and Keflavik, which WOW Air used to do at significant cost
- The new company’s IT department would be much smaller
- The company would focus on reducing passenger compensation; presumably they’re talking about EU compensation, which would require them to have fewer delays, lose or delay fewer bags, etc.
The whole thing sounded a bit odd, and maybe for good reason? The Iceland Monitor reports that this deal has been called off over failure to pay. A liquidator of WOW Air’s estate said:
“I can confirm that an agreement, which had been reached regarding the sale of these assets, has been canceled. We are, however looking into whether there is reason to negotiate a new agreement with those same parties.
One of the most valuable assets of the estate is a stock of spare parts and things related to the maintenance of Airbus aircraft. These are parts and tools that can be traded all over the world, and are not limited to potential airline operation in Iceland.”
Apparently her company repeatedly failed to make payments for WOW Air’s assets. The value of the assets was around 1.5 million USD, and was to be paid in a few installments.
It’s reported that the other party planning on launching an airline in Iceland this fall may now be interested in WOW Air’s assets.
This whole thing is just… weird.