Indigo Partners has broken off talks with WOW Air after three and a half months of negotiations. This split is troubling news for the already troubled airline—a company that now looks to its primary competitor to act as its saving grace.
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Following the breakdown of communication with Indigo Partners, talk has once again commenced between WOW Air and Icelandair, with discussions expected to close as quickly as Monday. Such a speedy conclusion to discussions has led many commentators to believe a deal is already in the works.
These new talks are something of a repeat of last year’s negotiations, which ended with no deal on November 9th after a month of discussing terms. This time around, both parties are negotiating in consultation with the government, another signal that a deal may soon be agreed upon.
If a deal is not signed in the upcoming weeks, it is looking likely that WOW Air will go out of business, leaving Icelandair as the country’s sole major airline. According to Eggert B. Ólafsson, an expert in competition law, a merger between the two companies is unlikely without strict conditions. Even so, WOW Air satisfies the requirements of a company disappearing from the market, leaving the possibility of a merger open.
See also: What To Pack For Travel in Iceland
Wizz Air—owned in large part by Indigo Partners—have revealed they are adding another route to Iceland, this time from Krakow, making it the airline’s tenth connection from Iceland’s. At the very least, this is some positive news given the dreary headlines concerning airlines over the last few weeks, and shows no sign that Iceland’s tourism boom will halt any time soon.
No doubt, it has been a difficult couple of months for the global aviation industry, and Iceland is no exception. For example, Icelandair’s shares dropped by almost ten percent at the stock exchange this week after grounding three of its Boeing 737 MAX 8 aircraft.
This decision was a necessary precaution given the current mystery surrounding Boeing’s suspected technological defects. The move followed many other countries who grounded their aircraft, including Britain, Singapore, Australia and Norway.
We will update you as the latest news on the WOW / Icelandair deal as it comes in. This story continues on from our previous coverage, Wow Air’s future still up in the air.