WOW air cuts service to STL

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Old Oct 15, 18, 9:57 pm
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WOW air cuts service to STL

Wow, that was quick: Wow Air to end flights from Lambert in January
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Old Oct 16, 18, 2:05 am
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Unfortunately, the article isn't available in the EU; could someone please post a summary?
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Old Oct 16, 18, 5:14 am
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Using Google Translate :

The only airline to provide nonstop service to Europe from St. Louis Lambert International Airport is ending the overseas flights after Jan. 7.

The news made public Monday came just five months after Iceland's budget carrier. Wow Air began its operations here and brought back trans-Atlantic travel after a 15-year hiatus. The airport lost nonstop flights to Europe in 2003 when American Airlines halted flights to London after absorbing the bankrupt Trans World Airlines and ceasing local hub operations.

"We are disappointed because the response from customers across the St. Louis region was strong, and we were told we were one of the airline's top performing markets in the Midwest that were added last spring, "the airport said in a statement Monday.

To get WOW here, st. Louis area governmental agencies offered $ 800,000 in incentives, $ 600,000 from the St. Louis County Port Authority and $ 200,000 from the airport, to help market the new route, plus waiving landing fees for 18 months that could total $ 392,000. But the airport said in its statement that the airline will not meet the criteria for airport incentives because it's ceasing service in January.

No reason was given for the discontinuation of the flights and Wow Air representatives had not responded to requests for comment as late Monday afternoon. But media reports elsewhere have cited serious business problems at Wow Air and worries about its future.

The Icelandic business publication The market reported this month that Wow Air's operating environment, like other European airlines, has recently worsened largely due to competition and rising oil prices.
The situation is dire enough that a government task force has been formed to create an emergency plan to respond should Wow Air and Icelandair go bankrupt.

This summer, the newspaper reported the airline founded in 2011 lost about $ 45 million from July 2017 through June before interest and tax.

The August announcement of the return of regular nonstop transatlantic service from Lambert was widely recalled by local leaders as a key step forward for the region and the airport, which had weeks earlier lost out to Nashville, Tenn., On landing a new British Airways flight to London. That airline has made it clear in talks with Lambert in recent years that the St. Louis market must support the sale of lucrative business-class seats for it to come here.

Wow offered an opposite, just-bones approach to flying - cheap seats with extra charges, including for luggage and food. Deals like $ 99 flights to Iceland have been offered, and $ 149 connecting flights to Amsterdam, Berlin, Copenhagen, Germany, Dublin, Frankfurt, Germany, and Paris. And it offered a promotion selling one-way service from Lambert to Delhi, India , through Iceland for $ 199.
It began flights from Lambert on May 17 and made a two-year commitment to St. Louis, one of four Midwest cities where Wow added service at the time. Another was Detroit, where flights to Iceland were being offered Monday on the Wow Air website through October of next year, but flights from the other two, Cleveland and Cincinnati, are temporarily halting in a couple of weeks.

The Cincinnati Business Courier reported last month that Wow Air would pause service from there after its Oct. 27 flight to Iceland through the spring. A Wow spokeswoman blamed the hiatus on operational, logistic and commercial reasons. The newspaper also reported that Wow flights from other airports were set to cease after October, including from Cleveland, Dallas-Fort Worth and New York's JFK International Airport.

Loss of nonstop flights to Europe comes as the city explores leasing Lambert to a private operator . It's a controversial effort that pits those who see such a partnership as a way for St Louis to keep ownership of its airport while bringing more money to city coffers against critics who say that such a move is not needed given recent growth at the airport and who cite concerns about conflicts of interest - Francis Slay initiated the move to look at privatization while serving as mayor, and has since been hired by a Spanish company considering a bid on such a lease.

The airport said Monday it will "continue to explore new opportunities" for nonstop international service.
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Old Oct 16, 18, 8:03 am
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WOW is cutting other TATL services as well. This is effectively restructuring to meet a new front. While consumers love low prices, those prices have to make sense for the service to remain viable.
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Old Oct 16, 18, 10:10 am
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Originally Posted by Often1 View Post
WOW is cutting other TATL services as well. This is effectively restructuring to meet a new front. While consumers love low prices, those prices have to make sense for the service to remain viable.
WOW air's recent bond sale was the minimum amount they wanted to get … I don't know off the top of my head how far off their target it was, but the interest rate was prime plus 9%, maturing in 3 years. they're also trying to do an IPO - I don't see that happening.
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Old Oct 16, 18, 10:44 pm
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Originally Posted by itsallgood View Post
WOW air's recent bond sale was the minimum amount they wanted to get … I don't know off the top of my head how far off their target it was, but the interest rate was prime plus 9%, maturing in 3 years. they're also trying to do an IPO - I don't see that happening.
From what I read their minimum was $50m, target was $100m and they got $54m. Of course the sale was done in another currency (not even Euros IIRC) so the exchange rates may have fluctuated.

They’re in trouble and they know it. The bond sale gives them an 18 month lifeline assuming all things remain the same, less if fuel increases or fares get depressed further. It’s them or Norwegian next to go under with a slim possibility that Icelandair could also be taken down. My money would be on Norwegian.
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Old Oct 17, 18, 5:02 am
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Originally Posted by usbusinesstraveller View Post
They’re in trouble and they know it. The bond sale gives them an 18 month lifeline assuming all things remain the same, less if fuel increases or fares get depressed further. It’s them or Norwegian next to go under with a slim possibility that Icelandair could also be taken down. My money would be on Norwegian.
I doubt that's enough to last them 18 months. They have additional aircraft deliveries this year so that will burn most of the cash raised. It's too late to turn off those deliveries. I don't know what they're scheduled to receive next year. They need to sell assets, like Norwegian is doing, in order to keep their doors open.
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Old Oct 17, 18, 8:58 pm
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They’ve cut (yet) another two US routes, taking the total cut to five.

STL - already discussed (3x weekly cut from 6th Jan)
CVG - 4x weekly cut from 26th Oct
CLE - 3x weekly cut from 25th Oct
DFW - 3x weekly cut from 26th Oct
JFK - Daily cut from 26th Oct

https://blueswandaily.com/wow-air-to...ive-us-routes/
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Old Oct 18, 18, 9:09 am
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Originally Posted by usbusinesstraveller View Post
They’ve cut (yet) another two US routes, taking the total cut to five.

STL - already discussed (3x weekly cut from 6th Jan)
CVG - 4x weekly cut from 26th Oct
CLE - 3x weekly cut from 25th Oct
DFW - 3x weekly cut from 26th Oct
JFK - Daily cut from 26th Oct

https://blueswandaily.com/wow-air-to...ive-us-routes/
WOW's going from 20 to 24 aircraft by the end of the year. The only recent additional flights I see are Chicago to New Delhi (with a stop in Iceland) and seasonal service to Orlando.
These route cutbacks seem like more than needed, especially with more aircraft coming.
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