WestJet (WS, Calgary) has announced its intention to launch a new, ultra-low-cost carrier (ULCC) in Canada subject to agreement with its pilots and any required regulatory approvals.
The carrier said in a statement that the yet-to-be-named ULCC is expected to start in late 2017 with an initial fleet of ten high-density B737-800s.
"We have built WestJet from its low-cost, regional roots into a renowned, international airline with service to 21 countries and today it's all about disrupting at the price-sensitive end of the market," said Clive Beddoe, co-founder of WestJet and Chair of the Board of the Directors. "Launching a ULCC will broaden WestJet's growth opportunities and open new market segments by offering more choice to those Canadians looking for lower fares."
Contacted for comment, WestJet's Vice-President (Communications), Richard Bartrem, told ch-aviation that the decision has yet to be taken as to whether the project will operate as a fully certificated stand-alone unit or as a virtual carrier using its parent's Air Operator's Certificate (AOC).
"[...] we will be announcing further details as we work through the regulatory approvals and the agreement with our pilots," he said.
The project's launch comes as Canada prepares to relax curbs on foreign investment in local airlines. Late last year, Minister of Transport Marc Garneau granted investment exemptions to ULCC start-ups Canada Jetlines (AU, Toronto Pearson) and Enerjet (Calgary) thereby allowing foreign investors to own up to 49% foreign voting interests in either airline. However, no single foreign investor or its affiliates may own more than a 25% voting interest.
Though it has expressed a keen interest in investing in Enerjet, US private equity firm Indigo Partners LLC (affiliated with Wizz Air, Frontier Airlines, and JetSMART), has, of late, held off on making a move until Ottawa fully clarifies its policies.
For its part, Jetlines announced last month that it had enlisted InterVISTAS Consulting Inc. to assist in the drawing up of its route structure for its first fifteen aircraft, along with a defined start-up schedule for its first four B737s.
Though no provisional launch date has yet been set, Jetlines does plan to operate flights throughout Canada and provide non-stop service from Canada to the United States, Mexico, and the Caribbean. During its first year of operations, it expects to operate six B737s.
