Icelandic carrier Wow Air Ehf said its fleet could be expanded to as many as 30 aircraft over the next five years as it rolls out low-cost flights connecting European cities with North America via a stop in Reykjavik.
Passenger growth could proceed at a rate of 50 percent a year, Skuli Mogensen, Wow’s founder and chief executive officer, said in an interview at the ITB travel-industry expo in Berlin.
Wow will take delivery of two Airbus Group NV A321 jets this month for flights from Iceland to Boston starting March 27 and to Baltimore-Washington International Airport from May 8. The single-class, 200-seat planes will operate alongside three smaller A320s and one A319, with two more A321s and a further A320 due next summer, taking the peak-season fleet to nine.
Mogensen has said Wow will be less reliant on transfer traffic than local rival Icelandair Group, which links more than a dozen North American cities with double that number of European destinations via Reykjavik. That means tapping further into Iceland’s burgeoning tourism market, the CEO said today.
Icelandair deploys a fleet of single-aisle Boeing Co. 757s, which have a longer range than the standard A321 jet but ceased production a decade ago. Mogensen had said previously that Wow was considering the option of sourcing used 757s.
In addition to its Icelandic competitor, Wow will face low- cost competition from Norwegian Air Shuttle ASA, which has begun linking Europe with the U.S. using Boeing Co. 787 Dreamliners that boast reduced fuel consumption compared with older wide- body models thanks to an all-composite construction.
“Narrow-body aircraft are cheaper to buy and easier to fill,” Mogensen said in Berlin. “To realize low operating costs, you need a full plane.” Wow currently has a load factor above 90 percent, he added.
Mogensen said that routing planes via Iceland means Wow’s A321s will be operating 20 hours per day on a Berlin-Reykjavik- Boston flight, offering better utilization than the 14 to 15 hours for wide-body jets on trans-Atlantic services.
Wow was profitable in the second half for the first time in 2014 and the CEO said he “hopes” it will post a full-year profit during the current 12 months.
This article was written by Richard Weiss from Bloomberg and was legally licensed through the NewsCred publisher network.
Photo credit: Skúli Mogensen, owner and CEO. WOW Air