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WOW becomes latest European budget airline to go under

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WOW becomes latest European budget airline to go under

WOW becomes latest European budget airline to go under

Icelandic budget airline WOW ceased operations Thursday, becoming the latest victim in a sector struggling with overcapacity.

Julian Satterthwaite reports.

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WOW becomes latest European budget airline to go under

More evidence that times are getting tougher for Europe's budget airlines.

Iceland's WOW Air ceased all operations on Thursday (March 28).

It's just the latest in a long list of strugglers.

Britain's Monarch went bust in 2017.

Flybe was sold at knock-down price in January this year.

German holiday airline Germania went under a month later.

Once fast-growing Norwegian is making losses.

And even mighty Ryanair - the giant among budget airlines in Europe - has posted a quarterly loss and issued a profit warning for the year ahead.

Analysts say there's a common theme underlying many of the problems. Budget airlines expanded too fast, resulting in over-capacity.

That sparked a race to the bottom on fares as airlines fought to fill seats.

Norwegian was the most direct rival for WOW.

Both were pioneers in low-cost transatlantic travel linking Europe and the U.S. Norwegian had about half that market; WOW about a quarter.

But it seems profits have proved elusive.

Norwegian has already said it will ax some routes and shut several bases to cut costs.

Earlier this week the chief executive said it aimed to turn profitable in 2019.

The Norwegians probably won't mourn the demise of their Icelandic rival.




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