• 1
  • 5
  • 6
  • 7
  • 8
  • 9
  • 20
 
User avatar
SRQKEF
Topic Author
Posts: 1847
Joined: Fri Jun 17, 2011 7:10 pm

Re: WOW Financial Discussion Thread

Sat Dec 01, 2018 11:03 pm

Gocaclleta wrote:
I've been keeping up with the WOW news coverage since the beginning, it's really been one hell of a ride hasn't it? But that's besides the point, I'm really curious about how their new partners are going to handle WOW, especially since WOW returned a good amount of their fleet already. Quite an interesting situation going on here in both the economic and aviation industry sense, and I'm quite curious to see how this ends up panning out. All any of us can do though is wait and see.


I think Indigo is actually happy about the returned aircraft, as I can't see A330s or A320ceos on expensive deals being a part of their plan for WOW. The returned aircraft may thus actually be a plus for Indigo.
Nothing compares to taking off in an empty 757 with full thrust!
 
mjoelnir
Posts: 8361
Joined: Sun Feb 03, 2013 11:06 pm

Re: WOW Financial Discussion Thread

Sun Dec 02, 2018 9:09 am

Ryanair01 wrote:
eaa3 wrote:
Ryanair01 wrote:

Ironically Wow's operating results were much better than Icelandair, it's just Icelandair have been asset stripping and have cash. If Indigo cash up Wow and Icelandair continues to burn through cash at almost twice the rate of Wow, then it will be interesting to see what happens. Of course it all depends if Wow make it to an Indigo investment, which doesn't feel certain.

If Wow can send aircraft in the winter to sister Indigo companies it will help them a lot. Wizz have a not insignificant presence in Iceland too, so some kind of link might be beneficial.


Icelandair has a profit of around $2MM in the first 9 months, compared with WOW’s $33MM loss. It’s not a big profit, and won’t lead to a profit on a yearly basis, but it’s considerably more profitable than WOW.


Yes, but cash is down significantly (USD 45m) and loans/borrowings both current and non current are up significantly (USD 115m). Operating costs are up by USD50m on a USD380m base. Those aren't healthy finances no matter what wizardry allows you to declare a nominal profit.


There is a solid equity at Icelandair. Cash reserves are down mainly because of investment activities. There is positive net cash flow from operating activities and enough cash on hand.
When accounting to IFRS you usually make a profit, a lot of the shenanigans that can be done in USGAAP are not possible in IFRS, so no need to talk about declared profits.

If you believe that WOW had better operating results than Icelandair, I recommend a pair of classes while reading financial reports.

By the way, the hotel chain has not been sold yet, the sales process has been started last month.
 
PVD757
Posts: 3219
Joined: Sun Aug 24, 2003 8:23 pm

Re: WOW Financial Discussion Thread

Sun Dec 02, 2018 3:07 pm

Does PWM, ISP, and TTN have an FIS capable of handling commercial international arrivals of 200 passengers?
 
The99Percent
Posts: 17
Joined: Thu May 26, 2016 4:25 pm

Re: WOW Financial Discussion Thread

Mon Dec 03, 2018 8:38 pm

https://www.routesonline.com/news/29/br ... dons-deal/
Some breaking news coming out right now!! Could this lead to some kind of JV/Codeshare between WOW and Frontier?
 
User avatar
SRQKEF
Topic Author
Posts: 1847
Joined: Fri Jun 17, 2011 7:10 pm

Re: WOW Financial Discussion Thread

Mon Dec 03, 2018 9:18 pm

The99Percent wrote:
https://www.routesonline.com/news/29/breaking-news/281796/budget-airline-specialist-to-back-wow-after-icelandair-abandons-deal/
Some breaking news coming out right now!! Could this lead to some kind of JV/Codeshare between WOW and Frontier?


Did you read any of the last 75 replies on this thread? This news came out before the weekend and has been discussed extensively already.

To sum up, any kind of JV/codeshare is unlikely to make sense under the current ULCC model both airlines operate.
Nothing compares to taking off in an empty 757 with full thrust!
 
User avatar
Runway28L
Posts: 1733
Joined: Wed Sep 20, 2017 7:35 pm

Re: WOW Financial Discussion Thread

Mon Dec 03, 2018 10:20 pm

I seriously don’t get the obsession with having WW and F9 interline or codeshare. It simply doesn’t make any sense. Look at the airports WOW currently flies to in the US and the service levels of Frontier at those locations:

- EWR: Zero service on F9
- BWI: Zero service on F9
- BOS: Zero service on F9
- PIT: Limited service on F9 (DEN, seasonal: PBI)
- DFW: Limited service on F9 (DEN, seasonal: CVG and PHL)
- LAX: Limited service on F9 (ATL, DEN, seasonal: CVG)
- SFO: Limited service on F9 (AUS, DEN, seasonal: CVG, DSM, LAS, OMA)

Cities that do have a good amount of F9 service like STL, CLE, and CVG have been cut or will be suspended. And PIT, DFW, and SFO who didn't have much service on Frontier to begin with are also being suspended. That really just leaves ORD and MCO (and AFAIK, MCO has been reduced to seasonal). I haven't even mentioned yet that a good portion of F9's network runs on frequencies that are less than daily. Coupled with WW also being less than daily to a lot of these places and the business case for an interline agreement between both of these airlines is DOA.

Indigo would be stupid if the first thing they did was set up an F9-WW interline agreement. The first thing they will do is try and get WW's costs under control.
Greetings from KPIT! Check out my photos here: https://www.airliners.net/search?user=45 ... teAccepted
 
Flaps
Posts: 1554
Joined: Sat Feb 05, 2000 1:11 pm

Re: WOW Financial Discussion Thread

Tue Dec 04, 2018 1:38 am

If Indigo is able to figure out a way to shift assets around seasonally among their various parts they might be able to make it work. Strip the Icelandic operations to bare bones during the winter and use those assets elsewhere while beefing up the Icelandic operations in the summer using aircraft from somewhere that summer is slow. Something like what F9 does with their US operations. WW as it currently exists is pretty much worthless in my opinion. It only has value if it can be made a part of a grander strategy.
 
Newbiepilot
Posts: 3638
Joined: Tue Aug 30, 2016 10:18 pm

Re: WOW Financial Discussion Thread

Tue Dec 04, 2018 2:02 am

Flaps wrote:
If Indigo is able to figure out a way to shift assets around seasonally among their various parts they might be able to make it work. Strip the Icelandic operations to bare bones during the winter and use those assets elsewhere while beefing up the Icelandic operations in the summer using aircraft from somewhere that summer is slow. Something like what F9 does with their US operations. WW as it currently exists is pretty much worthless in my opinion. It only has value if it can be made a part of a grander strategy.


That makes senses. Not sure how they will do that unless they buy into the Canadian leisure market like Sunwing or Air Transat who use extra winter capacity. The problem is that demand at Wizzair is also seasonal

With so many planes coming, it is hard to imagine what they will do with all of them.
 
SurfandSnow
Posts: 1436
Joined: Sun Feb 01, 2009 7:09 am

Re: WOW Financial Discussion Thread

Tue Dec 04, 2018 2:28 am

Runway28L wrote:
I seriously don’t get the obsession with having WW and F9 interline or codeshare. It simply doesn’t make any sense. Look at the airports WOW currently flies to in the US and the service levels of Frontier at those locations:

- EWR: Zero service on F9
- BWI: Zero service on F9
- BOS: Zero service on F9
- PIT: Limited service on F9 (DEN, seasonal: PBI)
- DFW: Limited service on F9 (DEN, seasonal: CVG and PHL)
- LAX: Limited service on F9 (ATL, DEN, seasonal: CVG)
- SFO: Limited service on F9 (AUS, DEN, seasonal: CVG, DSM, LAS, OMA)

Cities that do have a good amount of F9 service like STL, CLE, and CVG have been cut or will be suspended. And PIT, DFW, and SFO who didn't have much service on Frontier to begin with are also being suspended. That really just leaves ORD and MCO (and AFAIK, MCO has been reduced to seasonal). I haven't even mentioned yet that a good portion of F9's network runs on frequencies that are less than daily. Coupled with WW also being less than daily to a lot of these places and the business case for an interline agreement between both of these airlines is DOA.

Indigo would be stupid if the first thing they did was set up an F9-WW interline agreement. The first thing they will do is try and get WW's costs under control.


Indeed, as it stands today there is very little connectivity between F9 and WW. However, I *never* understood why WW kept going for costly primary airports like BOS, EWR, JFK, MIA and SFO when Norwegian was willing to try serving the likes of FLL, OAK, PVD and SWF. Why can't WW avoid head on competition with FI and shift its New England service to PVD? I don't know what F9 schedules are like to/from PVD, but it is not inconceivable to think that this airport would not only be popular with O&D travelers but also folks connecting to/from the Carolinas and Florida. The LAX service could be shifted to ONT to take advantage of lower costs while establishing a niche low fare transatlantic gateway to Southern California. Similarly, ORD could be abandoned in favor of MKE (which has always been a popular airport for Chicagoland travelers). I could go on, but I think the point is that WW needs to seriously reconsider service to primary U.S. airports given not only the intense competition it faces from FI in most cases but also the direct and indirect costs (i.e. frequent delays putting connecting passengers at risk) of serving them...
Flying in the middle seat of coach is much better than not flying at all!
 
User avatar
SRQKEF
Topic Author
Posts: 1847
Joined: Fri Jun 17, 2011 7:10 pm

Re: WOW Financial Discussion Thread

Tue Dec 04, 2018 2:36 am

SurfandSnow wrote:
Runway28L wrote:
I seriously don’t get the obsession with having WW and F9 interline or codeshare. It simply doesn’t make any sense. Look at the airports WOW currently flies to in the US and the service levels of Frontier at those locations:

- EWR: Zero service on F9
- BWI: Zero service on F9
- BOS: Zero service on F9
- PIT: Limited service on F9 (DEN, seasonal: PBI)
- DFW: Limited service on F9 (DEN, seasonal: CVG and PHL)
- LAX: Limited service on F9 (ATL, DEN, seasonal: CVG)
- SFO: Limited service on F9 (AUS, DEN, seasonal: CVG, DSM, LAS, OMA)

Cities that do have a good amount of F9 service like STL, CLE, and CVG have been cut or will be suspended. And PIT, DFW, and SFO who didn't have much service on Frontier to begin with are also being suspended. That really just leaves ORD and MCO (and AFAIK, MCO has been reduced to seasonal). I haven't even mentioned yet that a good portion of F9's network runs on frequencies that are less than daily. Coupled with WW also being less than daily to a lot of these places and the business case for an interline agreement between both of these airlines is DOA.

Indigo would be stupid if the first thing they did was set up an F9-WW interline agreement. The first thing they will do is try and get WW's costs under control.


Indeed, as it stands today there is very little connectivity between F9 and WW. However, I *never* understood why WW kept going for costly primary airports like BOS, EWR, JFK, MIA and SFO when Norwegian was willing to try serving the likes of FLL, OAK, PVD and SWF. Why can't WW avoid head on competition with FI and shift its New England service to PVD? I don't know what F9 schedules are like to/from PVD, but it is not inconceivable to think that this airport would not only be popular with O&D travelers but also folks connecting to/from the Carolinas and Florida. The LAX service could be shifted to ONT to take advantage of lower costs while establishing a niche low fare transatlantic gateway to Southern California. Similarly, ORD could be abandoned in favor of MKE (which has always been a popular airport for Chicagoland travelers). I could go on, but I think the point is that WW needs to seriously reconsider service to primary U.S. airports given not only the intense competition it faces from FI in most cases but also the direct and indirect costs (i.e. frequent delays putting connecting passengers at risk) of serving them...


While I see your point, there is a case to be made that DY has just shown in action that secondary airports often don't work by moving from FLL and OAK to MIA and SFO. However, WOW on its A32S fleet might be a better product for those secondary markets than 787s.
Nothing compares to taking off in an empty 757 with full thrust!
 
The99Percent
Posts: 17
Joined: Thu May 26, 2016 4:25 pm

Re: WOW Financial Discussion Thread

Tue Dec 04, 2018 2:15 pm

SRQKEF wrote:
The99Percent wrote:
https://www.routesonline.com/news/29/breaking-news/281796/budget-airline-specialist-to-back-wow-after-icelandair-abandons-deal/
Some breaking news coming out right now!! Could this lead to some kind of JV/Codeshare between WOW and Frontier?


Did you read any of the last 75 replies on this thread? This news came out before the weekend and has been discussed extensively already.

To sum up, any kind of JV/codeshare is unlikely to make sense under the current ULCC model both airlines operate.


My bad. I should have read the thread thoroughly before posting. Apologies.
 
User avatar
SRQKEF
Topic Author
Posts: 1847
Joined: Fri Jun 17, 2011 7:10 pm

Re: WOW Financial Discussion Thread

Tue Dec 04, 2018 2:21 pm

The99Percent wrote:
SRQKEF wrote:
The99Percent wrote:
https://www.routesonline.com/news/29/breaking-news/281796/budget-airline-specialist-to-back-wow-after-icelandair-abandons-deal/
Some breaking news coming out right now!! Could this lead to some kind of JV/Codeshare between WOW and Frontier?


Did you read any of the last 75 replies on this thread? This news came out before the weekend and has been discussed extensively already.

To sum up, any kind of JV/codeshare is unlikely to make sense under the current ULCC model both airlines operate.


My bad. I should have read the thread thoroughly before posting. Apologies.


No problem, we've all been there. :)

regards!
Sveinn
Nothing compares to taking off in an empty 757 with full thrust!
 
User avatar
RobK
Posts: 3592
Joined: Mon Sep 06, 2004 1:43 pm

Re: WOW Financial Discussion Thread

Tue Dec 04, 2018 2:50 pm

What is all this nonsense about interlining with Frontier and Indigo? Are people stupid or have they not read the thread? The interest is by Indigo PARTNERS - a private equity house which has their fingers in many different pies around the world. Nothing to do with Indigo the airline, Frontier Airlines, Jetsmart, Wizz Air or Volaris, so discussions of such ridiculous routes as SCL-MEX-DEN-KEF-BUD-DEL on A320s is a complete waste of bandwidth.
 
User avatar
Polot
Posts: 9344
Joined: Thu Jul 28, 2011 3:01 pm

Re: WOW Financial Discussion Thread

Tue Dec 04, 2018 3:16 pm

RobK wrote:
What is all this nonsense about interlining with Frontier and Indigo? Are people stupid or have they not read the thread? The interest is by Indigo PARTNERS - a private equity house which has their fingers in many different pies around the world. Nothing to do with Indigo the airline, Frontier Airlines, Jetsmart, Wizz Air or Volaris, so discussions of such ridiculous routes as SCL-MEX-DEN-KEF-BUD-DEL on A320s is a complete waste of bandwidth.

It has nothing to do with Indigo the airline, but some of the pies that Indigo Partners has their fingers in include Frontier Airlines, JetSmart, Wizz Air, and Volaris. So naturally there is going to be talk about whether a transatlantic airline is going to partner with their new cousins. But it is all a bit premature- the first focus will be on righting the ship and getting the airline profitable.
 
IADCA
Posts: 1846
Joined: Mon Feb 26, 2007 12:24 am

Re: WOW Financial Discussion Thread

Tue Dec 04, 2018 7:10 pm

RobK wrote:
What is all this nonsense about interlining with Frontier and Indigo? Are people stupid or have they not read the thread? The interest is by Indigo PARTNERS - a private equity house which has their fingers in many different pies around the world. Nothing to do with Indigo the airline, Frontier Airlines, Jetsmart, Wizz Air or Volaris, so discussions of such ridiculous routes as SCL-MEX-DEN-KEF-BUD-DEL on A320s is a complete waste of bandwidth.


Indigo Partners' "pies" include a majority stake in the Frontier Airlines "pie," as well as significant stakes in Wizz and Volaris, so they absolutely do have something to do with those carriers. If you're going to accuse people of being either stupid or ignorant (with no third option listed), it's generally better practice to be sure you've actually excluded the obvious third option - that you're the one in error. But at least you're right about it being separate from IndiGo, so maybe you can hang your hat on that while you reconsider whether it's such a wonderful idea to talk down to an entire thread full of people.
 
Ryanair01
Posts: 414
Joined: Fri Dec 27, 2013 9:27 pm

Re: WOW Financial Discussion Thread

Tue Dec 04, 2018 8:46 pm

arcticcruiser wrote:
Ryanair01 wrote:
arcticcruiser wrote:

Exactly which “asset stripping” has been going on at Icelandair?


Hotel chain.


This goes to show how uninformed and opinionated you are.


No it just shows how illiterate fan boys get.

mjoelnir wrote:
Ryanair01 wrote:
eaa3 wrote:

Icelandair has a profit of around $2MM in the first 9 months, compared with WOW’s $33MM loss. It’s not a big profit, and won’t lead to a profit on a yearly basis, but it’s considerably more profitable than WOW.


Yes, but cash is down significantly (USD 45m) and loans/borrowings both current and non current are up significantly (USD 115m). Operating costs are up by USD50m on a USD380m base. Those aren't healthy finances no matter what wizardry allows you to declare a nominal profit.


There is a solid equity at Icelandair. Cash reserves are down mainly because of investment activities. There is positive net cash flow from operating activities and enough cash on hand.
When accounting to IFRS you usually make a profit, a lot of the shenanigans that can be done in USGAAP are not possible in IFRS, so no need to talk about declared profits.

If you believe that WOW had better operating results than Icelandair, I recommend a pair of classes while reading financial reports.

By the way, the hotel chain has not been sold yet, the sales process has been started last month.


I know the sale process started last month, I'm familiar with the matter and all this nonsense that it's about refocusing the business is just that, nonsense.

The positive cash flow is because of the way summer is fully included but the low season is not fully. It will not be the case full year and cash in hand is significantly down with debt (both current and long term) significantly up, along with costs (largely but not exclusively for currency reasons). I agree cash in hand is OK for the moment and will get a boost when they sell the hotel assets off. I agree that gives them the tools needed to weather any short term storms.

But.... anyone who thinks that with the CEO gone, cash down, costs up, debt up, selling long held profitable assets, white collar jobs gone to Estonia, US3 on one side, easyjet/wizz on the other, plus a very disruptive home force and everything is just fine - well they'd be delusional, plain delusional.

My feeling is two KEF airlines isn't sustainable, which both FI and Wow's number back up. In the long run, and it is only relevant in the long run, Indigo's pockets are very much deeper than FI's.
 
User avatar
aemoreira1981
Posts: 2762
Joined: Mon Jan 09, 2017 12:17 am

Re: WOW Financial Discussion Thread

Tue Dec 04, 2018 9:32 pm

Ryanair01 wrote:
eaa3 wrote:
Ryanair01 wrote:

Ironically Wow's operating results were much better than Icelandair, it's just Icelandair have been asset stripping and have cash. If Indigo cash up Wow and Icelandair continues to burn through cash at almost twice the rate of Wow, then it will be interesting to see what happens. Of course it all depends if Wow make it to an Indigo investment, which doesn't feel certain.

If Wow can send aircraft in the winter to sister Indigo companies it will help them a lot. Wizz have a not insignificant presence in Iceland too, so some kind of link might be beneficial.


Icelandair has a profit of around $2MM in the first 9 months, compared with WOW’s $33MM loss. It’s not a big profit, and won’t lead to a profit on a yearly basis, but it’s considerably more profitable than WOW.


Yes, but cash is down significantly (USD 45m) and loans/borrowings both current and non current are up significantly (USD 115m). Operating costs are up by USD50m on a USD380m base. Those aren't healthy finances no matter what wizardry allows you to declare a nominal profit.


What Icelandair has going for it that WOW air did not: tangible assets. All of those passenger 757s and 3 of the 4 767s are owned, along with an array of other aircraft (Boeing and Airbus) leased to other airlines which FI likely owns without any notes on them by now, as well as the headquarters of the group and the real estate of the hotel chain (being sold now to concentrate on its core business). Remember that 20-aircraft B738 order back in the late 1990s that never flew for FI proper? FI still owns some of those planes (which has its Boeing customer code on it - 737-808). FI can engage in sale-leasebacks, or sales of aircraft with leases attached. The 737 MAX order is being financed partially with leases and JOLCOs, but FI can get better terms on that as they're buying initially from Boeing and then selling for a profit in the leaseback or JOLCO.

It is best that FI decided not to go forward when it saw the WW picture deteriorating. That could have caused major problems for FI down the line...best to just top off with more MAX aircraft or whatever MOM aircraft is most attractive for FI with a direct order.
 
mjoelnir
Posts: 8361
Joined: Sun Feb 03, 2013 11:06 pm

Re: WOW Financial Discussion Thread

Tue Dec 04, 2018 11:32 pm

aemoreira1981 wrote:
Ryanair01 wrote:
eaa3 wrote:

Icelandair has a profit of around $2MM in the first 9 months, compared with WOW’s $33MM loss. It’s not a big profit, and won’t lead to a profit on a yearly basis, but it’s considerably more profitable than WOW.


Yes, but cash is down significantly (USD 45m) and loans/borrowings both current and non current are up significantly (USD 115m). Operating costs are up by USD50m on a USD380m base. Those aren't healthy finances no matter what wizardry allows you to declare a nominal profit.


What Icelandair has going for it that WOW air did not: tangible assets. All of those passenger 757s and 3 of the 4 767s are owned, along with an array of other aircraft (Boeing and Airbus) leased to other airlines which FI likely owns without any notes on them by now, as well as the headquarters of the group and the real estate of the hotel chain (being sold now to concentrate on its core business). Remember that 20-aircraft B738 order back in the late 1990s that never flew for FI proper? FI still owns some of those planes (which has its Boeing customer code on it - 737-808). FI can engage in sale-leasebacks, or sales of aircraft with leases attached. The 737 MAX order is being financed partially with leases and JOLCOs, but FI can get better terms on that as they're buying initially from Boeing and then selling for a profit in the leaseback or JOLCO.

It is best that FI decided not to go forward when it saw the WW picture deteriorating. That could have caused major problems for FI down the line...best to just top off with more MAX aircraft or whatever MOM aircraft is most attractive for FI with a direct order.


And that is in short, sufficient equity.
 
airberlin2017
Posts: 49
Joined: Sat Oct 01, 2016 4:40 am

Re: WOW Financial Discussion Thread

Mon Dec 10, 2018 7:01 pm

The delivery of the A330neo to WOW Air is likely to be canceled. All DEL flights (from April) will be changed a few days ago to A330ceo.

Source: Seatingmap in the booking system on wow-air.us.
 
arcticcruiser
Posts: 361
Joined: Tue Aug 22, 2017 2:16 pm

Re: WOW Financial Discussion Thread

Thu Dec 13, 2018 11:30 am

WOW Air just laid off 111 staff, plus laying off contractors in all probably close to 400. Just in time for Christmas. Dropping DEL and LAX
http://eyjan.dv.is/eyjan/2018/12/13/fjo ... m-faekkad/
 
arcticcruiser
Posts: 361
Joined: Tue Aug 22, 2017 2:16 pm

Re: WOW Financial Discussion Thread

Thu Dec 13, 2018 11:30 am

Double
 
faxiTMA
Posts: 55
Joined: Wed Jan 07, 2009 7:23 pm

Re: WOW Financial Discussion Thread

Thu Dec 13, 2018 11:33 am

Today WOW is laying off 110 full time employees and not extending contracts to contractors and part time employess, a total of 350-400 staffmembers according to Icelandic media. They are reducing the fleet down to 11 aircraft, only A320's and A321's.

My thoughts are with WW employees, horrible time this close to Christmas.

Skuli Mogensens letter to employees today has been leaked http://www.dv.is/frettir/2018/12/13/sja ... si-mistok/

Dear friends,

After an incredible journey since founding WOW air seven years ago, we are now faced with the biggest and most difficult restructuring in the history of the airline which includes making some very tough decisions. This involves significantly reducing our fleet from 20 to 11 aircraft and not taking delivery of the four A330neo, scaling back our operations accordingly and therefore I am very sad to say laying off a large number of people. This action is devastating given the hard work all of you have been doing and I wish there was any other way possible. We have looked at multiple possibilities but unfortunately this reduction is the only credible way we can see to save WOW air and build a foundation that we can grow from again. I am deeply sorry for having to take this extreme action since it will affect many of you dedicated WOW employees and a large number of consultants and temporary hires. However, I sincerely hope you will understand that this is necessary in order to save the remaining almost 1000 jobs at WOW air and allow us to continue to fly to and from Iceland and across the Atlantic. We are going back to our roots as an ultra-low cost airline and focus on our core business which served us so well in our first years up until 2017. Instead of sharpening our ultra-low cost model based on the success of 2015 and 2016 we started complicating our business by adding the wide body aircraft and introducing Premium and Comfy products which is far from our original vision. In short, we lost focus and started behaving like a legacy airline. These mistakes have almost cost us the company as our losses in 2018 have escalated in recent months due to poor financial results. It’s very important to note that I cannot blame anybody but myself for those mistakes as I personally championed the A330 fleet expansions, premium seating and to fly further east and west. This is a very painful lesson since at the same time we have built something unique with WOW air and while this will require us to take one difficult step back in the short term, I am convinced it will enable us to take two steps forward in the long term and ensure that WOW air will thrive in the future. With the prospect of getting Indigo Partners as our investors I want to go back to our original vision and demonstrate that we can indeed build a great low cost long haul airline. For what it’s worth I want to thank you and I also want to make the promise that once we start growing again you will be the first that we will welcome back. There will be a staff meeting at 1pm today and myself and the management team will be around all day to answer any questions and concerns you might have.
 
mjoelnir
Posts: 8361
Joined: Sun Feb 03, 2013 11:06 pm

Re: WOW Financial Discussion Thread

Thu Dec 13, 2018 11:52 am

For Icelandair the best situation now, would be for WOW to simply go bust.
 
User avatar
SRQKEF
Topic Author
Posts: 1847
Joined: Fri Jun 17, 2011 7:10 pm

Re: WOW Financial Discussion Thread

Thu Dec 13, 2018 12:10 pm

faxiTMA wrote:
Today WOW is laying off 110 full time employees and not extending contracts to contractors and part time employess, a total of 350-400 staffmembers according to Icelandic media. They are reducing the fleet down to 11 aircraft, only A320's and A321's.

My thoughts are with WW employees, horrible time this close to Christmas.

Skuli Mogensens letter to employees today has been leaked http://www.dv.is/frettir/2018/12/13/sja ... si-mistok/

Dear friends,

After an incredible journey since founding WOW air seven years ago, we are now faced with the biggest and most difficult restructuring in the history of the airline which includes making some very tough decisions. This involves significantly reducing our fleet from 20 to 11 aircraft and not taking delivery of the four A330neo, scaling back our operations accordingly and therefore I am very sad to say laying off a large number of people. This action is devastating given the hard work all of you have been doing and I wish there was any other way possible. We have looked at multiple possibilities but unfortunately this reduction is the only credible way we can see to save WOW air and build a foundation that we can grow from again. I am deeply sorry for having to take this extreme action since it will affect many of you dedicated WOW employees and a large number of consultants and temporary hires. However, I sincerely hope you will understand that this is necessary in order to save the remaining almost 1000 jobs at WOW air and allow us to continue to fly to and from Iceland and across the Atlantic. We are going back to our roots as an ultra-low cost airline and focus on our core business which served us so well in our first years up until 2017. Instead of sharpening our ultra-low cost model based on the success of 2015 and 2016 we started complicating our business by adding the wide body aircraft and introducing Premium and Comfy products which is far from our original vision. In short, we lost focus and started behaving like a legacy airline. These mistakes have almost cost us the company as our losses in 2018 have escalated in recent months due to poor financial results. It’s very important to note that I cannot blame anybody but myself for those mistakes as I personally championed the A330 fleet expansions, premium seating and to fly further east and west. This is a very painful lesson since at the same time we have built something unique with WOW air and while this will require us to take one difficult step back in the short term, I am convinced it will enable us to take two steps forward in the long term and ensure that WOW air will thrive in the future. With the prospect of getting Indigo Partners as our investors I want to go back to our original vision and demonstrate that we can indeed build a great low cost long haul airline. For what it’s worth I want to thank you and I also want to make the promise that once we start growing again you will be the first that we will welcome back. There will be a staff meeting at 1pm today and myself and the management team will be around all day to answer any questions and concerns you might have.


That letter admits to much of what many of us have been saying ever since they got A330s and ordered the A330neos. They simply didn't have the critical mass for WB operations at that time, Icelandair had been building its network for decades when it could finally add 767s in 2016 and be successful with them. If they'd just added one A320 series aircraft at a time, along with maybe 1-2 new destinations on either side of the Atlantic each year, they could be in a much different situation.
Nothing compares to taking off in an empty 757 with full thrust!
 
NCAD95
Posts: 46
Joined: Fri Aug 10, 2018 12:11 am

Re: WOW Financial Discussion Thread

Thu Dec 13, 2018 7:30 pm

faxiTMA wrote:
Today WOW is laying off 110 full time employees and not extending contracts to contractors and part time employess, a total of 350-400 staffmembers according to Icelandic media. They are reducing the fleet down to 11 aircraft, only A320's and A321's.

My thoughts are with WW employees, horrible time this close to Christmas.

Skuli Mogensens letter to employees today has been leaked http://www.dv.is/frettir/2018/12/13/sja ... si-mistok/

Dear friends,

After an incredible journey since founding WOW air seven years ago, we are now faced with the biggest and most difficult restructuring in the history of the airline which includes making some very tough decisions. This involves significantly reducing our fleet from 20 to 11 aircraft and not taking delivery of the four A330neo, scaling back our operations accordingly and therefore I am very sad to say laying off a large number of people. This action is devastating given the hard work all of you have been doing and I wish there was any other way possible. We have looked at multiple possibilities but unfortunately this reduction is the only credible way we can see to save WOW air and build a foundation that we can grow from again. I am deeply sorry for having to take this extreme action since it will affect many of you dedicated WOW employees and a large number of consultants and temporary hires. However, I sincerely hope you will understand that this is necessary in order to save the remaining almost 1000 jobs at WOW air and allow us to continue to fly to and from Iceland and across the Atlantic. We are going back to our roots as an ultra-low cost airline and focus on our core business which served us so well in our first years up until 2017. Instead of sharpening our ultra-low cost model based on the success of 2015 and 2016 we started complicating our business by adding the wide body aircraft and introducing Premium and Comfy products which is far from our original vision. In short, we lost focus and started behaving like a legacy airline. These mistakes have almost cost us the company as our losses in 2018 have escalated in recent months due to poor financial results. It’s very important to note that I cannot blame anybody but myself for those mistakes as I personally championed the A330 fleet expansions, premium seating and to fly further east and west. This is a very painful lesson since at the same time we have built something unique with WOW air and while this will require us to take one difficult step back in the short term, I am convinced it will enable us to take two steps forward in the long term and ensure that WOW air will thrive in the future. With the prospect of getting Indigo Partners as our investors I want to go back to our original vision and demonstrate that we can indeed build a great low cost long haul airline. For what it’s worth I want to thank you and I also want to make the promise that once we start growing again you will be the first that we will welcome back. There will be a staff meeting at 1pm today and myself and the management team will be around all day to answer any questions and concerns you might have.



What he is actually saying here in the big markets where WOW has stiff competition he can only fill airplanes with $99 fares any premium fares he charges over and above his lowest fare really doesn't offer anything that a basic economy fare on a legacy does so WOW can not compete in that environment. When the customer has a choice he will always chose Basic Economy over WOW's premium economy just for reliability alone. So WOW's only choice is going back to relying on their $99 fares to fill planes and make money.
 
IADCA
Posts: 1846
Joined: Mon Feb 26, 2007 12:24 am

Re: WOW Financial Discussion Thread

Thu Dec 13, 2018 7:39 pm

Going down to 11 planes implies more routes will need to be cut.
 
User avatar
madpropsyo
Posts: 63
Joined: Sat Jun 09, 2018 2:02 am

Re: WOW Financial Discussion Thread

Thu Dec 13, 2018 7:48 pm

At this point what would Indigo be investing in?

An airline cutting its fleet and route network while acknowledging its product and business model has failed seems like a bad place to put your money.
 
IADCA
Posts: 1846
Joined: Mon Feb 26, 2007 12:24 am

Re: WOW Financial Discussion Thread

Thu Dec 13, 2018 7:51 pm

madpropsyo wrote:
At this point what would Indigo be investing in?

An airline cutting its fleet and route network while acknowledging its product and business model has failed seems like a bad place to put your money.


Staff, a couple slots at slot-restricted airports (I assume the slots are leased), aircraft leases (which might or might not be on good terms), maybe some gate leases as well. A pile of contracts, essentially, some of which might have positive NPV and some of which might not.
 
SurfandSnow
Posts: 1436
Joined: Sun Feb 01, 2009 7:09 am

Re: WOW Financial Discussion Thread

Thu Dec 13, 2018 8:12 pm

I can't say I'm surprised. When I flew BCN-KEF-LAX the "premium" seating did not seem to be available on the BCN-KEF sector, even though I submitted a minimum bid ($15 IIRC) for it. My minimum bid (~$90) for the KEF-LAX sector was accepted, although the crew was unable to fill the empty "XL" seat next to me in spite of concerted efforts to do so during our hour or so delay at KEF. The girl sitting next to me said that WW absolutely preferred to delay flights and wait for connecting passengers than risk having to put anyone in pricey Icelandic accommodations. Still, paying just $290 to fly from Barcelona to LA in mid-August (even Turkish Airlines, Aeroflot and Norwegian were charging significantly higher prices) and less than $100 for an upgrade on a 9 hour flight seemed way too good to be true. I can't imagine how bad the LAX service did at other times of year. It will be interesting to see if Icelandair even bothers to try LAX...
Flying in the middle seat of coach is much better than not flying at all!
 
douwd20
Posts: 155
Joined: Fri May 13, 2005 3:45 am

Re: WOW Financial Discussion Thread

Thu Dec 13, 2018 9:25 pm

As soon as WOW Air can vanish the better. The most awful airline I've ever flown or tried to fly.
 
a350lover
Posts: 715
Joined: Sun Dec 24, 2017 11:21 am

Re: WOW Financial Discussion Thread

Thu Dec 13, 2018 10:00 pm

Does anybody know what's the professional background of those current lay off employees at WOW? Are they mostly young people who joined the aviation industry at WOW? Did they come from other airlines? Icelandair? I assume FI offers better conditions?
 
crescent
Posts: 106
Joined: Thu Apr 19, 2018 3:09 am

Re: WOW Financial Discussion Thread

Thu Dec 13, 2018 10:09 pm

SurfandSnow wrote:
The girl sitting next to me said that WW absolutely preferred to delay flights and wait for connecting passengers than risk having to put anyone in pricey Icelandic accommodations. Still, paying just $290 to fly from Barcelona to LA in mid-August


Well, sure, to LAX, the WW aircraft sits there for 20 hours until the flight the next day, so they wouldn't care if it arrived in LAX late. I don't think they take this policy so generously for the shorter Eastern US time zone flights where the aircraft has to be back by 430am in KEF so those passengers can make their connections to Europe on flights at 600a-700a.
 
User avatar
SRQKEF
Topic Author
Posts: 1847
Joined: Fri Jun 17, 2011 7:10 pm

Re: WOW Financial Discussion Thread

Thu Dec 13, 2018 10:20 pm

a350lover wrote:
Does anybody know what's the professional background of those current lay off employees at WOW? Are they mostly young people who joined the aviation industry at WOW? Did they come from other airlines? Icelandair? I assume FI offers better conditions?


There were some FI summer pilots and cabin crew who joined WOW to seek full time employment in recent years. Not sure how many there were though. Most of the WOW staff was hired from somewhere else as FI does indeed offer better conditions in the long term.
Nothing compares to taking off in an empty 757 with full thrust!
 
Natflyer
Posts: 628
Joined: Fri Oct 11, 2013 9:29 pm

Re: WOW Financial Discussion Thread

Thu Dec 13, 2018 10:21 pm

a350lover wrote:
Does anybody know what's the professional background of those current lay off employees at WOW? Are they mostly young people who joined the aviation industry at WOW?


Yes they are.
 
User avatar
Polot
Posts: 9344
Joined: Thu Jul 28, 2011 3:01 pm

Re: WOW Financial Discussion Thread

Thu Dec 13, 2018 10:31 pm

crescent wrote:
SurfandSnow wrote:
The girl sitting next to me said that WW absolutely preferred to delay flights and wait for connecting passengers than risk having to put anyone in pricey Icelandic accommodations. Still, paying just $290 to fly from Barcelona to LA in mid-August


Well, sure, to LAX, the WW aircraft sits there for 20 hours until the flight the next day, so they wouldn't care if it arrived in LAX late. I don't think they take this policy so generously for the shorter Eastern US time zone flights where the aircraft has to be back by 430am in KEF so those passengers can make their connections to Europe on flights at 600a-700a.

Those flights to Europe only happen with those planes from the US. It was (is?) not uncommon for basically WOW’s entire schedule to be delayed by several hours.
 
Natflyer
Posts: 628
Joined: Fri Oct 11, 2013 9:29 pm

Re: WOW Financial Discussion Thread

Thu Dec 13, 2018 10:42 pm

crescent wrote:
SurfandSnow wrote:
The girl sitting next to me said that WW absolutely preferred to delay flights and wait for connecting passengers than risk having to put anyone in pricey Icelandic accommodations. Still, paying just $290 to fly from Barcelona to LA in mid-August


Well, sure, to LAX, the WW aircraft sits there for 20 hours until the flight the next day, so they wouldn't care if it arrived in LAX late. I don't think they take this policy so generously for the shorter Eastern US time zone flights where the aircraft has to be back by 430am in KEF so those passengers can make their connections to Europe on flights at 600a-700a.


Well if it is late into LAX where they practice minimum crew rest, the outbound will be late to. Domino effect...
 
nomorerjs
Posts: 876
Joined: Wed Sep 01, 2004 10:24 am

Re: WOW Financial Discussion Thread

Thu Dec 13, 2018 10:55 pm

WW won’t be flying by summer 2019. Every week or every two weeks they cut a route or two. It’s only a matter of time before BWI and DTW are cut and than it will end.
 
User avatar
Frontier14
Posts: 597
Joined: Sat Dec 25, 2010 4:14 am

Re: WOW Financial Discussion Thread

Thu Dec 13, 2018 11:00 pm

nomorerjs wrote:
WW won’t be flying by summer 2019. Every week or every two weeks they cut a route or two. It’s only a matter of time before BWI and DTW are cut and than it will end.


Or the end will come sooner if Indigo Partners chooses not to go forward with their investment/acquisition.

Frontier 14
 
juliuswong
Moderator
Posts: 1629
Joined: Wed Dec 14, 2016 3:22 am

Re: WOW Financial Discussion Thread

Fri Dec 14, 2018 1:45 am

Sadly WW bites more than it can chew, hence now the mess. Thoughts are with WW furloughed employees.

It is equally saddening we can't see A330neo flying in WW colours. Now where would those two MSN 1870 TF-BIG and MSN 1887 TF-MOG go to? Both are without their Trent 7000, livery has been removed after they deferred delivery back in Oct. Looks like Avolon (their lessor) may have issue offloading them and Airbus now has two orphaned A330neo now.
- Life is a journey, travel it well -
 
a350lover
Posts: 715
Joined: Sun Dec 24, 2017 11:21 am

Re: WOW Financial Discussion Thread

Fri Dec 14, 2018 3:08 pm

SRQKEF wrote:

There were some FI summer pilots and cabin crew who joined WOW to seek full time employment in recent years. Not sure how many there were though. Most of the WOW staff was hired from somewhere else as FI does indeed offer better conditions in the long term.


Interesting... I thought summer jobs linked to the aviation industry was mainly an issue of the South of Europe. Pity, even they had summer job pilots, that's pretty awful. Changing airlines was/is a bit of an issue in a few countries. I believe there is EU current legislation which restricts hardly the swap between airlines, so that professionals of this industry do not mix procedures between airlines. Pilots for sure, cabin crew would not be able to take part of a refresh/recurrent AC training if they are at the same time working for a different operator.
 
User avatar
SRQKEF
Topic Author
Posts: 1847
Joined: Fri Jun 17, 2011 7:10 pm

Re: WOW Financial Discussion Thread

Fri Dec 14, 2018 3:21 pm

a350lover wrote:
SRQKEF wrote:

There were some FI summer pilots and cabin crew who joined WOW to seek full time employment in recent years. Not sure how many there were though. Most of the WOW staff was hired from somewhere else as FI does indeed offer better conditions in the long term.


Interesting... I thought summer jobs linked to the aviation industry was mainly an issue of the South of Europe. Pity, even they had summer job pilots, that's pretty awful. Changing airlines was/is a bit of an issue in a few countries. I believe there is EU current legislation which restricts hardly the swap between airlines, so that professionals of this industry do not mix procedures between airlines. Pilots for sure, cabin crew would not be able to take part of a refresh/recurrent AC training if they are at the same time working for a different operator.


There is too much seasonality in Icelandair's operations to keep a full crew roster throughout the year. For example, FI operated flights to over 50 destinations last summer while this winter that number is down to around 30. Frequencies on some of those 30 routes also drop in winter. There used to be an even bigger gap in S vs W schedules, but FI has had it as a gosl to steadily close it in recent years.

And to be clear, no pilots were flying for FI in summer and WOW in winter. Some FI pilots that had summer-only contracts for Icelandair transferred over to a full time job at WOW. However, more and more FI new hires are now hired on a year-round basis to be competitive with the relative pilot shortage here in Iceland due to the fast growth of WOW (and to a lesser extent the steadfast growth of FI). That could of course change now with WOW scaling back and laying off staff.
Nothing compares to taking off in an empty 757 with full thrust!
 
GBerg
Posts: 23
Joined: Thu Dec 06, 2012 6:32 pm

Re: WOW Financial Discussion Thread

Fri Dec 14, 2018 5:37 pm

According to this source Indigo partners will invest up to $75 mil. in WOW air.

http://www.vb.is/frettir/75-milljon-dol ... ow/151538/
 
Breathe
Posts: 491
Joined: Sat Mar 18, 2017 8:06 pm

Re: WOW Financial Discussion Thread

Fri Dec 14, 2018 6:14 pm

GBerg wrote:
According to this source Indigo partners will invest up to $75 mil. in WOW air.

http://www.vb.is/frettir/75-milljon-dol ... ow/151538/

Woah! It'll be interesting to know what their plans are.
 
User avatar
SRQKEF
Topic Author
Posts: 1847
Joined: Fri Jun 17, 2011 7:10 pm

Re: WOW Financial Discussion Thread

Fri Dec 14, 2018 6:36 pm

Breathe wrote:
GBerg wrote:
According to this source Indigo partners will invest up to $75 mil. in WOW air.

http://www.vb.is/frettir/75-milljon-dol ... ow/151538/

Woah! It'll be interesting to know what their plans are.


Fron what I've heard, at least 50 million of that will just go into keeping WOW alive.
Nothing compares to taking off in an empty 757 with full thrust!
 
NCAD95
Posts: 46
Joined: Fri Aug 10, 2018 12:11 am

Re: WOW Financial Discussion Thread

Fri Dec 14, 2018 6:48 pm

SRQKEF wrote:
Breathe wrote:
GBerg wrote:
According to this source Indigo partners will invest up to $75 mil. in WOW air.

http://www.vb.is/frettir/75-milljon-dol ... ow/151538/

Woah! It'll be interesting to know what their plans are.


Fron what I've heard, at least 50 million of that will just go into keeping WOW alive.


Has this gone through now or is the survival of WOW Air still hanging in the balance ?
 
User avatar
Frontier14
Posts: 597
Joined: Sat Dec 25, 2010 4:14 am

Re: WOW Financial Discussion Thread

Fri Dec 14, 2018 6:58 pm

It will be interesting to learn the details of this investment. Indigo Partners bought Frontier cheap and turned it around. Perhaps the same game plan for WOW with their 11 planes remaining.

Frontier 14
 
User avatar
SRQKEF
Topic Author
Posts: 1847
Joined: Fri Jun 17, 2011 7:10 pm

Re: WOW Financial Discussion Thread

Fri Dec 14, 2018 7:06 pm

NCAD95 wrote:
SRQKEF wrote:
Breathe wrote:
Woah! It'll be interesting to know what their plans are.


Fron what I've heard, at least 50 million of that will just go into keeping WOW alive.


Has this gone through now or is the survival of WOW Air still hanging in the balance ?


According to Skuli it's still pending on a due diligence report, but the terms of the deal have been agreed.
Nothing compares to taking off in an empty 757 with full thrust!
 
Natflyer
Posts: 628
Joined: Fri Oct 11, 2013 9:29 pm

Re: WOW Financial Discussion Thread

Fri Dec 14, 2018 9:33 pm

SRQKEF wrote:
NCAD95 wrote:
SRQKEF wrote:

Fron what I've heard, at least 50 million of that will just go into keeping WOW alive.


Has this gone through now or is the survival of WOW Air still hanging in the balance ?


According to Skuli it's still pending on a due diligence report, but the terms of the deal have been agreed.


No announcement by Indigo Partners that I can find. Only by WOW. And Skuli´s word has been proved to be...
 
User avatar
SRQKEF
Topic Author
Posts: 1847
Joined: Fri Jun 17, 2011 7:10 pm

Re: WOW Financial Discussion Thread

Fri Dec 14, 2018 9:52 pm

Natflyer wrote:
SRQKEF wrote:
NCAD95 wrote:

Has this gone through now or is the survival of WOW Air still hanging in the balance ?


According to Skuli it's still pending on a due diligence report, but the terms of the deal have been agreed.


No announcement by Indigo Partners that I can find. Only by WOW. And Skuli´s word has been proved to be...


What do you mean? Can't you see his statement plan of being larger than not only Icelandair but also SAS in 2020 is well underway? ;)
Nothing compares to taking off in an empty 757 with full thrust!
 
workhorse
Posts: 623
Joined: Sun Jul 10, 2005 11:35 pm

Re: WOW Financial Discussion Thread

Sat Dec 15, 2018 1:59 pm

Does anyone have an idea on which frames are going and which are staying?
  • 1
  • 5
  • 6
  • 7
  • 8
  • 9
  • 20

Popular Searches On Airliners.net

Top Photos of Last:   24 Hours  •  48 Hours  •  7 Days  •  30 Days  •  180 Days  •  365 Days  •  All Time

Military Aircraft Every type from fighters to helicopters from air forces around the globe

Classic Airliners Props and jets from the good old days

Flight Decks Views from inside the cockpit

Aircraft Cabins Passenger cabin shots showing seat arrangements as well as cargo aircraft interior

Cargo Aircraft Pictures of great freighter aircraft

Government Aircraft Aircraft flying government officials

Helicopters Our large helicopter section. Both military and civil versions

Blimps / Airships Everything from the Goodyear blimp to the Zeppelin

Night Photos Beautiful shots taken while the sun is below the horizon

Accidents Accident, incident and crash related photos

Air to Air Photos taken by airborne photographers of airborne aircraft

Special Paint Schemes Aircraft painted in beautiful and original liveries

Airport Overviews Airport overviews from the air or ground

Tails and Winglets Tail and Winglet closeups with beautiful airline logos