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Icelandic Airline Wow Air Collapses and Cancels all Flights:
Iceland's low cost carrier Wow Air has canceled all flights and told passengers to book with other airlines.
Its website has a travel alert that begins: "Wow Air has ceased operation. All Wow Air flights have been canceled."
The alert said people who wanted to travel should now look for "so-called rescue fares" which may now be offered by rival airlines.
Wow added that those who made bookings by credit card or via a European travel agent should try to get their money back through those businesses. It said some passengers may be entitled to compensation from the airline itself.
[...] The company's model was to entice passengers with ultra-low prices before slapping on extra charges for seat selection, baggage, leg room and expensive refreshments. A typical base fare for a Wow flight from the U.S. to Europe could come in at less than $200.
A fall in tourist visits to Iceland and rising fuel costs had been cited as headwinds to profitability.
The airline had also suffered poor customer reviews and was particularly criticized over recurring delays.
You don't always get what you pay for, but you generally do not get what you do not pay for.
(Score: 0) by Anonymous Coward on Monday April 01 2019, @01:06AM (1 child)
No, they can get in line. In the US, the priority is given in 11 USC 507. Let's look at this for a non-personal bankruptcy: From the top, the assets that Wow leased are going back to the lessors. No reason they should not make money with their property. For distribution of company assets, first in line will be the bankruptcy administration itself. They wouldn't work for free. Then it is employees and suppliers for moneys owed to them (capped at $10k). I hope you will see that it is equitable that regular workers have high priority. Then the retirement benefits of the employees. Now it's the turn of people who paid for services received.
This is how it goes in the adult world. Our capitalist society has set up a balance of creditor protections vs the ability of businessmen to take a risk. The debtor's business may fail, and creditors may get pennies on the dollar. However, fraud commited by the debtor is punishable. Arguably, this freedom to do business by soliciting other people's capital is the base of the wealth and progress of first world countries.
Adverse events happening is a risk we all face, and you fail to deal with them at your own peril. You could blow out a tire on the road, and you had better maintained your spare. You could pick a flight and go "ooh, only $200 to Thailand", but if the company fails, you have to do the needful to get yourself back home again. Could have picked the $800 flight, but you are never free of risk.
Anyway, the process is simple if you paid by credit card, so it's not even worth getting excited about.
(Score: 3, Insightful) by sjames on Monday April 01 2019, @02:20AM
Much older rule, don't leave people stranded. I'm not talking about bankruptcy law, I'm talking about common decency. They can't have NOT known they were going bankrupt when they took people's money and flew them a thousand miles from home with the (empty) promise of a return flight. The people who were stranded accepted their offer in good faith even though the offer was made in bad faith.
They could have made alternate arrangements to get their passengers home BEFORE they signed the bankruptcy papers. They could at least have refunded the tickets, then signed the papers.