With the changing of Canadian airline WestJet over the last few years to raise airfare to match that of Air Canada, the Canadian domestic market now lacks a low cost carrier. Canadian flights to Caribbean and European destinations are littered with low cost carriers like CanJet, Sunwings, and Air Transat flying mostly from Montreal or Toronto. In 2013 Air Canada started a low cost carrier called Air Canada Rouge but the airline was built to compete with the Canadian low cost carriers who flew to the Caribbean and Europe. Rouge being a leisure market carrier left the domestic Canadian market subject to high airfare with Air Canada and WestJet being the only carriers, however, change my come soon to the Canadian skies.
Two ultra low cost carriers are planning to start service to western Canada in the near future. The first is Canada Jetlines who plans to follow the business models of Ireland’s RyanAir and the US carrier Spirit Airlines. They plan to fly Boeing 737 classic aircraft for their first few years however they have already placed an order for five of Boeing’s newest 737, the 737-7MAX, with options for 16 more. Canada Jetlines plans to fly on what they call Canada’s underserved markets. Early estimates given by the company say that they plan to fly routes like Vancouver to Prince George for about $72, half the price of what Air Canada and WestJet cost now. The airline also plans on people wanting to avoid Air Canada and WestJet’s prop planes in the west and prefer to fly jets. Canada Jetlines plans to hub in Vancouver and fly to Manitoba, Alberta, and British Columbia but avoid WestJet’s stronghold in Calgary. If all goes well, the airline plans to start service in the summer of 2015.
The other airline planning on starting service as an ultra-low cost carrier is called Jet Naked. The no frills carrier plan is similar to that of Canada Jetlines by offering low fares to western Canadian cities using Boeing 737s. Where the two carriers differ is the starting cities, while Canada Jetlines is starting in Vancouver, Jet Naked is starting in Calgary. Jet Naked will also fly more popular flights between Calgary and Vancouver, Winnipeg, and Edmonton. Jet Naked says they plan to cost 60% less on these flights than what the competition offers.
The road ahead for these two carriers will be a challenge, although both have ambitious plans and already thinking about international destinations, they must remember that the Canadian skies have not been friendly for low cost carriers. Air Canada and WestJet have already said they plan to lower fares in the west as soon as Jet Naked and Canada Jetlines start operations in order to maintain their stronghold in the Canadian domestic market. Canada has only seen two low cost carriers rise to be strong carriers recently, those being Porter Airlines and WestJet. The list of failures is long, including Canada 3000, JetsGo, and Zoom Airlines. If these two new airlines plan to succeed, they must be willing to make the correct moves to make sure they stay alive in the Canadian domestic market.
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