Westjet isn’t buying a bunch of 787’s to fly between yyz, yvr and YYC. I’d be shocked if in the next year or 2 anywhere an AT 330 flew isn’t being serviced by a WJ 787 + AC WB. I think AT will shrink into a 100% quebec / yyz airline and that’s probably a good healthy place for them to be since they have the brand loyalty to compete really well in Quebec.Latitude wrote: ↑Wed Nov 17, 2021 10:27 amTransat isn't the same as Sunwing, Flair, Swoop or Lynx. They have a BIG market to European destinations. None of the others have that or have the capacity to do it. Maybe LONG term if they dont fail before that but we all know that European destinations is in another league. Transat also is kind of vertically integrated.Cavalier44 wrote: ↑Wed Nov 17, 2021 10:20 am The aviation market is becoming exceptionally saturated in this country. Soon we will have:
1. Air Canada / Rouge
2. WestJet / Swoop
3. Porter (order for 30 Embraer E195-E2s with purchase rights for 50 more)
4. Flair (12 737s, with a stated goal to grow to 50 within 5 years)
5. Sunwing (primarily sun destinations, probably less exposed to competition, but with Flair adding Mexico + Caribbean flying, still has to be somewhat concerned about new market entrants)
6. Transat (same as above)
7. Lynx Air (plans to add 46 737s over the next seven years)
I strongly suspect that there is not nearly enough passenger demand in this country to sustain this many airlines in the long term. I predict we will see a bloodbath on fares in the short to medium-term as Swoop / Porter / Flair / Lynx all scramble to undercut one another flying the same low-yield passengers to the same destinations. Air Canada should be relatively insulated from this given their market share and massive route network and will be able to use Rouge selectively to compete on low-yield routes. Likewise, WestJet will use Swoop as a vehicle to fend off the new entrants to the market although how much success they will have in doing so under new ownership remains to be seen.
Sunwing uses a vertically integrated model to sell vacation packages and is probably less concerned with making any money on the flights, as the profit comes from the vacation package in its entirely (predominantly hotels and excursions). I don't see Sunwing actively trying to compete with Flair or Swoop in the sun destinations market as the flights themselves are not the revenue generator for the company as a whole. However, they will have to price their packages in such a way to remain attractive to people who would be willing to take a ULCC-priced flight to Mexico and book an Airbnb there rather than going the all-inclusive route, for example.
My big question marks are Porter, Flair, this new Lynx Air, and to a lesser extent, Transat (shaky financial situation going forward but with the Quebec government likely willing to subsidize the airline to keep it in operation indefinitely). Obviously, this goes without saying, but a disclaimer nonetheless - I don't wish for any airline in this country to fail or for any pilot to be out of a job. But with that being said, I think it's apparent that the ULCC market space in Canada is too small to sustain all these new entrants simultaneously. I strongly suspect that we are due for some consolidation in some form within the next 2-3 years as the aviation market rebounds, what remains to be seen is how exactly that will take place and which airlines will be affected.
I'd be concerned if I was AC or WS first since all those ULCC will be flying a lot domestic and US.
If people were up in arms about AC’s CEO not speaking French they sure as heck won’t be hopping on a bunch of western based airlines (WJ, Swoop, Flair, Lynx etc)
WJ is one of the biggest wildcards in the whole thing, all we know is they didn’t take federal money, does that mean they are well positioned for growth or are they barely surviving and don’t want the feds to keep them cutting routes / shrinking?
The one thing I will agree with is there is going to be too much capacity the next few years and unfortunately even a really well run airline could fail to one with deeper pockets that can outlast them.