When WOW Air, Iceland’s budget airline known for its hot pink planes, launched just six years ago things seemed too good to be true. The no frills airline boasts dirt cheap prices for trips across the atlantic, sometimes offering flights as low as $49 for a one way trip to its hub in Reykjavik’s Keflavik Airport. The airline’s launch and pricing was part of a strategy to increase tourism in Iceland by offering cheap flight prices and stopovers for passengers flying to Europe from the U.S. Unfortunately what sounds too good to be true often is, and that was the case with WOW Air.

Dirt Cheap Flights

When WOW air was founded by Icelandic entrepreneurial tycoon Skuli Mogensen in 2011 the aim was to create budget flights to Iceland from European countries. The airline quickly expanded to other continents, and began offering transatlantic flights to the United States and Canada within just a few years. Prices were low, and frequent sales meant that passengers could snag a flight deal for around $99 one way. These unheard of prices were from destinations like Los Angeles, San Francisco, and New York. All the $99 got you was a seat at the back of the plane, but it was enough to aid in a massive tourism boom for the tiny nordic country. A country so small that tourists outnumbered locals on a ratio of five to one.

Eventually the low prices caught up with the airline, though. In early November of 2018 it was announced that Icelandair would be acquiring WOW air by the end of the year. This meant that the air carrier would begin offering its own version of the budget flight to combat its high-priced counterparts. This would be the no-frills sister to Icelandair, and the move was said to create a drastic change in the airline market for transatlantic flights. Unexpectedly, though, WOW air had to return a couple of its planes to meet fulfillment costs. The budget airline was forced to scale back its operations significantly, causing flight cancellations around the world. Passengers on flights from Chicago, one of the cities WOW air had to back out of, experienced sudden cancellations with no alternative budget routes.

New Investors

Icelandair quickly backed out of the deal, and WOW air was left to pick itself up off of the ground in a financial crisis. As of today, the airline still operates out of four U.S. cities with some seasonal routes in other destinations. Finally, famed airline investor Bill Franke came to save the day for the failing airline. Franke is known for investing in low-cost airlines and turning them around into profitable machines. Such was the case with Frontier Airlines, which now turns a profit by charging for everything but breathing the air.

It will take some time to determine whether or not WOW Air will be able to get itself back up off the ground. The airline was offering free flights to Europe for passengers with the last name “Valentine” in February of this year. The promotion was probably to match the company’s magenta branding, the color that made it famous in the last couple of years. The deal with Franke is yet to be finalized, but if the deal goes through there is no doubt that the investor can help get WOW to a profitable point. For the time being, passengers may want to be weary of booking with the carrier in case things go south agian.