Icelandair issued a statement assuring customers that no price changes were going into effect due to WOW air’s closure. Stundin reported, however, that the airline’s ticket prices have risen rapidly: up to 200% on some routes in just a few days. Following WOW air’s announcement yesterday that the company was ceasing operations, the value of Icelandair stocks went up by 13%. At the same time that Icelandair shares were rising, the stocks of most other companies on the Iceland Stock Exchange were losing value.
Increased demand drives price hikes
Higher prices since WOW’s announcement are a consequence of increased demand, says Icelandair, which has caused customers to buy up the lowest fares. “The price of airline tickets is based on demand and in recent days and weeks, there has been a significant demand for our flights, and now as well due to the discounted rates we’re offering WOW passengers. In some cases, there are only first class seats available or else flights are fully booked.”
Icelandair released a discount price schedule for stranded WOW air passengers on Thursday afternoon. Per the announcement on their website, the discount fares are only available to travelers who have already embarked on their journey, and who have a return ticket with WOW air between March 28 and April 11. Fares are based on availability, but are currently listed as $60 to and from Europe; $100 to and from North America, and $160 on Europe-North America or North America-Europe flights (via Keflavík).
Prices could rise in future
Airline competition will not be enough to maintain low flight prices to and from Iceland, according to one specialist. Kristján Sigurjónsson, journalist and editor of Icelandic travel media outlet Túristi, told RÚV it is likely the cost of flights to and from the country will rise in the coming months. “Flight prices have been unusually low and we passengers have been flying at the cost of [airlines] in recent years and that is unlikely to continue,” Kristján stated, adding that while competition between airlines may temporarily keep prices low on certain routes, they will likely rise.