CEO of WOW Air: change of strategy behind the departure of three cities in the Midwest of the United States
CEO of WOW Air: change of strategy behind the departure of three cities in the Midwest of the United States
WOW Air confirmed that it was dismiss three cities in the United States this week, leading to speculation that the Icelandic budget airline known for cheap flights to Europe may be shrinking here.
But that is not the case, says the chief executive of the operator. In fact, the airline still hosts ambitious plans for North America, said Skúli Mogensen, founder and CEO of WOW, to USA. UUToday in heaven on Wednesday.
"We will absolutely continue investing in our network in North America," Mogensen said, adding that the test is only a week away.
"We are going to announce a major new destination in North America next week," he said, refusing to offer more details.
Mogensen also said that WOW will increase flights from its largest cities in the United States and Canada next summer.
But Mogensen's optimistic comments about the US market came just a day after WOW confirmed that the service will end at three of its most recent destinations in the US. USA: Cincinnati, Cleveland and St. Louis.
WOW announced its expansion to the cities with great fanfare last year, expanding to mid-western markets that seldom get new transatlantic options, much less a budget company known for $ 99 one way fares to Europe.
Flights from those cities were launched last May, but will end this month in Cincinnati and Cleveland and in January in St. Louis.
A fourth city announced during the recent boost of WOW in the Midwest, Detroit, will remain a destination for WOW. This will be Chicago O'Hare, WOW is the first city in the Midwest that was announced in a previous round of expansion. But the departure of the airline is a disappointment for the other three airports, where new nonstop routes to Europe were a prestigious addition to existing flight schedules.
What led to the demise of the WOW service there?
Conventional wisdom suggests that the routes were losing money, perhaps sinking into the red in the midst of the rapidly rising prices of jet fuels. Otherwise, why would WOW be withdrawn?
Today in heaven: The shows of the airline have everything (the story continues down)
But Mogensen refused to say that the routes operated at a loss, suggesting that the airline simply had better prospects elsewhere.
"They were not performing as well as in many other cities where we believe we can add capacity ... and make it even better," he said.
The real culprit for the fall of Midwestern cities may be the next WOW service to India. Mogensen says the flights the airline will soon launch between New Delhi and Iceland have generated an increase in demand for connecting flights to North America and that the airline is now trying to change capacity to those routes with the greatest potential.
Mogensen says that part of WOW's strategy is "to be more aggressive, certainly more aggressive than traditional operators, in the exploration of new destinations," such as those he tried in the Midwest of the United States.
Plus: WOW air receding? Service to three Midwest cities with an ax.
"But," he continued, "as a result, we also have to be very disciplined by not prematurely falling in love with a single route and being willing to do a proper analysis and move the plane."
"We have a finite number of airplanes that fly," he says. "We have a limited number of slot machines in Keflavik (WOW's central airport near Reykjavik), so we have to optimize the way we use it from time to time."
As for the new WOW service in India, flights from New Delhi to Reykjavik start on December 6 and are now on sale. WOW will open with three flights a week between the cities in the new Airbus A330neo aircraft with capacity for 365 passengers.
Mogensen says that, according to current reservations, "80 percent of Delhi's passengers are using Iceland as a hub that flies to North America."
"This is driving some of the changes we are now discussing with respect to next year," Mogensen said, "because we see that Delhi's demand is more toward the larger destinations we are already serving (in North America)."
That led to the "great demand" for connections in North America, "mainly from our existing larger destinations," Mogensen said. "So we need to fill that capacity by adding frequency to existing routes."
Mogensen refused to specify which cities will see an increase in capacity. But when asked specifically if WOW destinations such as New York, Boston and Baltimore / Washington are the types of large markets with proven international demand, he called those "good guesses" but gave no further details.
However, despite the change in strategy, Mogensen did not rule out returning to medium-sized markets like those that were abandoned in the Midwest.
He refused several times to say that the routes were to lose money, instead of describing it as simply a matter of looking for other opportunities that seemed more lucrative.
"The fact that we make this decision ... does not mean that we will not visit some of these destinations in the future," he said.
WOW Air was launched in 2012 and launched its first flights to the United States in 2015, expanding rapidly in North America since then.
Even with the loss of the three cities in the Midwest, WOW still offers seasonal or year-round services to 12 airports in the United States and Canada from its center in Iceland.
Those destinations are: Baltimore / Washington, Boston, Chicago O'Hare, Dallas / Fort Worth, Detroit, Los Angeles, Montreal, New York JFK, Pittsburgh, San Francisco, Toronto and Newark, New Jersey.
Flights to a 13th destination in North America, Orlando, Florida, are scheduled to begin on December 19. The new destination that Mogensen said would be announced next week would increase the WOW airport count in North America to 14.
TODAY IN HEAVEN: American airports with low cost flights to Europe.
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