WOW air
Icelandic ultra-low-cost airline that built a transatlantic network through Keflavík before collapsing in March 2019.
Last updated August 21, 2026
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Overview
WOW air was an Icelandic ultra-low-cost airline founded by entrepreneur Skúli Mogensen in 2011 and launched commercial operations in 2012. Based at Keflavík International Airport near Reykjavík, it used Iceland's position between Europe and North America to develop a connecting model built around low fares, relatively dense Airbus narrow-body operations and paid ancillary services. Its brand emphasized bright visual identity, unconventional marketing and the idea that Iceland could become a major low-cost transit point across the North Atlantic. The airline opened bookings in November 2011 and operated its first flight from Keflavík to Paris Charles de Gaulle on 31 May 2012. In October of that year it acquired the operations and network of Iceland Express, accelerating its access to European and North American markets. WOW air carried more than 400,000 passengers in 2013 and reached its one-millionth passenger in December 2014. From 2015 onward, it expanded across the Atlantic, initially serving the United States and then Canada. Airbus A330-300 aircraft enabled long-haul routes to destinations including Los Angeles and San Francisco, while the airline continued to use Airbus A320 and A321 aircraft for European and shorter transatlantic services. Growth was rapid. Passenger capacity more than doubled in 2016, and the network reached a high of 36 destinations in 2018. The airline's proposition was closely associated with headline low fares, including heavily promoted introductory prices, but passengers generally paid separately for baggage, seat selection and other services. In 2017, its advertising and media coverage attracted criticism because a widely reported London-to-New York fare was available only under particular booking conditions and as part of a more expensive return itinerary. The expansion increased revenue but also produced losses and operational pressure. Contemporary reporting attributed the deterioration to overexpansion, a widening loss margin and reputational problems involving customer service. In November 2018, Icelandair Group agreed in principle to acquire WOW air, but the proposed transaction failed to satisfy its conditions and was abandoned. Indigo Partners subsequently reached a preliminary investment agreement, but that proposal also collapsed in March 2019. During the same period, WOW air returned aircraft to lessors, reduced staff, planned route and fleet cuts, and attempted to restructure its debt through a bond-to-equity conversion. WOW air ceased all operations on 28 March 2019 after failing to secure a viable financing or takeover solution. Its operating company, WOW air hf., went out of business, leaving passengers stranded and contributing to disruption in Iceland's tourism sector. Later attempts by USAerospace Associates to revive the brand did not lead to verified scheduled passenger operations. Former WOW air executives later helped establish PLAY, a separate Icelandic airline that began service in 2021. WOW air therefore remains principally associated with the rise and collapse of Iceland's low-cost transatlantic airline model.
History
WOW air emerged during a period when Iceland's tourism industry and international air traffic were expanding. Iceland's location in the North Atlantic had long supported stopover traffic between Europe and North America, while the depreciation of the Icelandic króna after the 2008 financial crisis helped make the country attractive to visitors. Skúli Mogensen, an Icelandic technology and telecommunications entrepreneur, founded the airline in 2011 through his investment company Titan. He identified an opportunity for a low-cost carrier centered on Iceland and described an ambition for the country to become a major northern transit point. Bookings opened on 24 November 2011, with the airline planning a European network. Its first flight took place on 31 May 2012 between Keflavík and Paris Charles de Gaulle. Later in 2012, WOW air acquired the operations and network of Iceland Express, giving it access to established routes and helping it scale quickly. Services to destinations including London Gatwick, Copenhagen, Berlin, Salzburg and Warsaw formed part of the early expansion. The airline's passenger base grew rapidly. It carried more than 400,000 passengers in 2013 and recorded its millionth passenger in December 2014. In 2015 it began building a North American network, followed by Canadian routes in 2016. The introduction of Airbus A330-300 aircraft allowed it to serve western U.S. destinations such as Los Angeles and San Francisco. Its capacity more than doubled in 2016 compared with the previous year, and its network eventually reached 36 destinations in 2018. The fleet developed from leased Airbus A320-200 aircraft to a broader A320-family fleet including A321s, A320neos and A321neos, supplemented by A330-300 wide-body aircraft. The commercial model relied on low base fares and additional charges for services that traditional airlines often bundled into the ticket. In 2017, the airline's claims around a £99 London-to-New York fare drew criticism because the price was limited by conditions and did not represent a generally available standalone one-way journey. Although revenue increased, the airline recorded a loss in 2017 after two profitable years. Analysts and reporting associated the weakness with rapid expansion, fleet and route complexity, and service-quality problems. Third-quarter 2018 results continued to show revenue growth accompanied by a larger loss margin. Financial pressure intensified in late 2018. Icelandair Group announced a proposed acquisition on 5 November, but WOW air returned four aircraft later that month after a planned sale-and-leaseback arrangement failed and suppliers and contractors imposed stricter conditions. Icelandair abandoned the deal on 29 November. Indigo Partners then reached a preliminary agreement to invest, initially for a 49 percent holding with a possible later increase. WOW air responded with staff reductions, aircraft withdrawals, route cancellations and cancellation of Airbus A330-900 orders. The investment proposal was withdrawn in March 2019, and renewed discussions with Icelandair also failed. In the final days, several flights were cancelled, aircraft were repossessed by a lessor, and the airline announced a proposed bond conversion into equity while seeking agreement with bondholders. On 27 March it postponed flights scheduled for the following day. On 28 March 2019 it ceased operations, cancelled all flights and advised passengers to arrange alternative travel. Its collapse affected Iceland's tourism economy and created substantial disruption because the carrier had represented a significant share of visitors arriving by air. After the bankruptcy, USAerospace Associates announced plans to acquire assets and revive the name. It made repeated claims about future passenger and cargo operations, but flights did not begin and independent reporting found no confirmed evidence of a functioning relaunch or an air operator's certificate application. Former WOW air executives separately developed a new airline concept, first called WAB air and later renamed PLAY; that company was a successor project rather than a continuation of WOW air. The original WOW air brand remains defunct.
- 2019
Operations cease
[1]WOW air stops flying on 28 March after takeover and financing efforts fail.
- 2018
Network reaches peak scale
[1]The airline reaches approximately 36 destinations before its financial retrenchment.
- 2016
Wide-body operations begin
[1]Airbus A330-300 aircraft support new long-haul services to the western United States.
- 2015
North American expansion begins
[1]The carrier begins expanding from its European network toward the United States and Canada.
- 2014
One-millionth passenger
[1]WOW air reaches one million cumulative passengers in December.
- 2012
First scheduled flight
[1]WOW air launches service from Keflavík to Paris Charles de Gaulle on 31 May.
- 2012
Iceland Express operations acquired
[1]The acquisition expands WOW air's route network and operating footprint.
- 2011
WOW air is founded
[1]Skúli Mogensen establishes the Icelandic low-cost airline through Titan.
Products and positioning
Ultra-low-cost transatlantic airline using Iceland as a connecting hub between Europe and North America.
Scheduled air travel · 2012
European passenger flights
WOW air's original network connected Keflavík with European cities, including Paris, London, Copenhagen, Berlin, Salzburg and Warsaw. These routes formed the short- and medium-haul foundation of its low-cost model and supplied connecting traffic for longer services.
Long-haul air travel · 2015
Transatlantic passenger flights
The airline's signature offering was low-fare travel between Europe and North America with a connection through Iceland. Airbus A320-family aircraft served many routes, while A330-300 aircraft supported longer services to destinations such as Los Angeles and San Francisco.
Airline ancillary services · 2012
Ancillary travel services
The ultra-low-cost proposition separated the base fare from optional services. Passengers could pay additional amounts for items such as checked baggage, seat selection and related travel options, allowing the airline to advertise a lower initial ticket price.
Marketing campaigns
- 2017£99 London–New York fare promotion
United Kingdom · United States
WOW air promoted a headline fare between London Stansted and New York that attracted extensive media attention. Critics noted that the fare was subject to restrictive conditions and was available in a return-booking context rather than as a broadly available standalone one-way ticket.
Outcome. The promotion increased visibility but generated criticism of the airline's pricing communication.
Brand decisions
2019
Seek Indigo Partners investmentM&ABackground
After the Icelandair transaction failed, WOW air sought a new strategic investor.
Action taken
Indigo Partners agreed in principle to acquire an initial 49 percent stake, with a possible later increase.
Aftermath
Indigo Partners withdrew its proposal in March, leaving the airline without a completed rescue transaction.
2019
Cease operationsStrategyBackground
Aircraft repossessions, cancelled flights, failed investment talks and unresolved bondholder discussions left the airline unable to continue.
Action taken
WOW air cancelled all flights and stopped operating on 28 March.
Aftermath
The operating company went out of business, passengers were stranded and the brand became defunct.
2018
Pursue a sale to Icelandair GroupM&ABackground
Rapid expansion, losses and worsening supplier conditions created a need for strategic support.
Action taken
WOW air entered a proposed acquisition by Icelandair Group, subject to conditions and shareholder approval.
Aftermath
Icelandair abandoned the transaction when the required conditions appeared unlikely to be met.
- Icelandair Group — It withdrew from the proposed acquisition after reviewing the transaction conditions.
2018
Retrench fleet, routes and staffingStrategyBackground
The airline's financial position worsened after a proposed sale-and-leaseback arrangement failed.
Action taken
WOW air returned four aircraft, reduced staff by about 360 people, phased out additional aircraft and cancelled several routes and A330neo orders.
Aftermath
The cuts reduced the planned scale of the airline but did not restore financial viability.
2016
Introduce wide-body aircraft for western U.S. routesStrategyBackground
The airline was expanding its low-cost model beyond Europe and needed aircraft suitable for longer sectors.
Action taken
It began operating leased Airbus A330-300 aircraft and used them on routes including Los Angeles and San Francisco.
Aftermath
Capacity and long-haul reach increased, but the broader expansion later contributed to financial pressure.
2012
Acquire Iceland Express operationsM&ABackground
WOW air was still building its initial network and sought a faster route to scale.
Action taken
It acquired Iceland Express's operations and network, adding routes and increasing frequencies.
Aftermath
The transaction accelerated the airline's European expansion.
Recent events
- 2019
Indigo Partners investment proposal collapses[1]
M&A
A preliminary agreement under which Indigo Partners would initially acquire a minority stake was withdrawn in March.
- 2019
WOW air ceases operations and enters bankruptcy[1]
Bankruptcy
On 28 March, the airline cancelled all flights and stopped operating after financing and restructuring efforts failed.
- 2019
USAerospace Associates announces an attempted WOW air revival[1]
M&A · Other
The U.S.-based holding company announced plans to acquire assets and restart service, but no independently verified passenger operation followed.
- 2018
Icelandair Group announces proposed acquisition of WOW air[1]
M&A
Icelandair Group agreed in principle to acquire the airline, but the proposed deal was abandoned after its conditions were unlikely to be met.
- 2018
WOW air returns aircraft and reduces its network[1]
Leadership change
After its financial position worsened, the airline returned four aircraft, reduced staffing, retired additional aircraft and cancelled or ended several routes.
- 2017
WOW air promotes a £99 London–New York fare[1]
Pricing · Other
The airline faced criticism over media coverage of a headline fare that was subject to booking conditions and was not generally available as a simple one-way journey.
- 2015
WOW air expands into North America[1]
Other
The carrier began its North American expansion with United States service, followed by Canada in 2016.
- 2012
WOW air begins commercial operations[1]
Product launch
The airline operated its first scheduled service from Keflavík to Paris Charles de Gaulle on 31 May.
- 2012
WOW air acquires Iceland Express operations and network[1]
M&A
The transaction expanded WOW air's network and increased its presence in European markets.
Sources1 sources
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