Written by Benjamin Bearup

MIAMI — Icelandic low-cost carrier WOW Air will soon fly four new routes to the United States. Today, the airline announced that it will begin service between Reykjavik, Iceland and Cleveland, Cincinnati, St. Louis, and Detroit.

Adventures in America await! ???? Introducing 4 new exciting destinations in the U.S. ?? #wowair pic.twitter.com/gQn0dUGmzy

— WOW air (@wow_air) August 23, 2017

Each route will start on different dates. Detroit will launch on April 26th, Cleveland on May 4th, Cincinnati on May 10th, and St. Louis on May 17th of 2018.

For Cleveland, an airport that has lacked transatlantic service since 2009, WOW Air is the second airline in two days to launch transatlantic service. Just yesterday, WOW Air’s largest rival, Icelandair, announced that it will start service to Cleveland in May of 2018 as well. Cleveland will be a market to watch over the coming year as these two carriers battle for market position.

“We are proud to partner with Cleveland Hopkins International Airport to provide the lowest fares possible over the Atlantic to Northeast Ohio area travelers. Our goal is to help make international travel truly a possibility for everyone,” said WOW Air Founder and CEO Skuli Mogensen.

For Cincinnati (CVG), WOW’s route will compete with Delta’s daily service to Paris. Being the only airline offering transatlantic from CVG, Delta has been able to dictate prices in the market. With WOW’s new service, customers will now have a second direct option to fly to Europe. With CVG being a hub for Delta, we expect Delta to face minimal impact from WOW’s presence in the market. Most WOW Air customers will be created by their low prices and are unlikely to be siphoned from Delta. Cincinnati once was a major transatlantic hub for Delta, with nonstop links to London Gatwick, Frankfurt, Amsterdam, Rome and Zurich throughout the 1990’s and 2000’s. However, Paris is the route which remains, largely due to a corporate contract sustained with Cincinnati-based Proctor & Gamble.

“WOW Air is one of the fastest growing, low-cost transatlantic carriers. With this new service, local travelers will not only have the benefit of nonstop travel to Iceland, but one-stop, low-cost service to more than 20 destinations across Europe, Israel and Canary Islands. We’re thrilled to be one of WOW’s newest U.S. markets, and look forward to growing their service from CVG,” said CVG CEO Candace McGraw.

For Detroit, WOW adds diversity to a market that is controlled by Delta. For the most part, if an airline is not named Delta or a member of SkyTeam, they have avoided Detroit as to not go against the highly competitive Delta Air Lines. While Lufthansa and Royal Jordanian have made Detroit work, others have steered clear of the Motor City. Like most WOW Air markets, the airline’s customer base will consist of travelers who would otherwise not have flown transatlantic if it weren’t for WOW’s ultra low-costs.

In St. Louis, WOW hopes to replicate the recent success of other low-cost carriers in the Gateway City. St. Louis, a once bustling hub for TWA with transatlantic flights to London, Paris, and Frankfurt, currently offers no transatlantic flights. For several years, American Airlines continued TWA’s legacy and operated several transatlantic flights as well. After being de-hubbed, St. Louis has been struggling to find its place on the international map.

With this expansion, WOW Air will fly to 12 destinations in the United States. The airline already flies to Baltimore, Boston, Chicago O’Hare (seasonal), Los Angeles, Miami, Newark, Pittsburgh, and San Francisco. On longer routes such as Los Angeles and San Francisco, WOW Air flys the larger Airbus A330 instead of the A320.

WOW Air currently operates a fleet of 17 aircraft. Of these aircraft, three are A330-200s with 342 seats, 11 are A321s, and three are A320s. One A320 and one A321 in their fleet are of the Airbus A320neo variant. WOW Air currently has outstanding orders for the A321ceo, A321neo (2), and the A330neo (4).

This will bring WOW Air to parity with Icelandair in terms of the number of destinations served in the U.S. Icelandair will also serve twelve markets in Summer 2018, including Anchorage, Boston, Chicago, Cleveland, Denver, Minneapolis/St. Paul, New York JFK, Newark, Philadelphia, Portland, Seattle and Washington Dulles. Icelandair exclusively serves its U.S. markets using Boeing aircraft, namely 757-200s, 757-300s and 767-300s.

The network strategy between Icelandair and WOW Air has some unique contrasts in that Icelandair appears to target markets which are densely-populated (New York, Boston, Chicago and Washington) or tourism-heavy in the peak summer months, such as Seattle, Portland, Denver and Anchorage. In contrast, WOW has been targeting medium-sized cities which have lost transatlantic service over the past few years, such as Cleveland, Cincinnati, Pittsburgh, and St. Louis. There is some overlap in that both airlines are targeting both origin and destination (O&D) customers wanting to travel to Iceland, which has been drawing a mass appeal for its natural beauty, as well as connecting passengers over Reykjavik to continental Europe and the Middle East.

Icelandair has a longer-standing presence in core European markets such as Dublin, Helsinki, Oslo and Madrid. However, WOW has been gradually catching up. WOW added service to London Stansted in April and will launch Tel Aviv in September 2017.

The transatlantic corridor to and from Iceland will not just be limited to WOW and Icelandair. Delta currently serves Reykjavik from its New York JFK and Minneapolis/St. Paul hubs, while Air Canada Rouge launched Toronto – Reykjavik, and Montreal – Reykjavik routes in Summer 2017. Furthermore, discount competition continues to grow on transatlantic routes as other players like Norwegian deploy narrow-body 737-MAX aircraft to cities such as Newburgh/Stewart, Hartford and Providence to the British Isles, along with WestJet who has also been expanding its transatlantic network through narrowbody and widebody services, and also has a 787-9 order in the pipeline.

That said, WOW still has lower-hanging fruit at its disposal. Markets like Columbus, Indianapolis, Nashville, and Charlotte are ripe for its network, and should the current roster of new Midwest markets perform to expectations, there will likely be continued growth in the months to come.

Written by Benjamin Bearup and Rohan Anand