WestJet Airlines Looks to Repatriate Canadian Passengers With No-Frills Carrier

WestJet

WestJet Airlines Ltd (NASDAQ:$WJAFF)’s Chief Financial Officer Harry Taylor stated on Wednesday that the company plans to leverage ultra-low-cost carriers to target Canadian passengers who currently cross the border into the United States for cheaper fares.

Taylor adds that Canada’s second largest airline, which is launching the separate no-frills carrier in June 2018, is attempting to attract Canadians who now drive to places like Buffalo and New York for cheaper fares from U.S. rivals.

“What we’re trying to do is to be able to repatriate those Canadians who are driving across the border. They’ve chosen to make that trip across the border for the lower fares that are being offered.” Taylor iterated at the Cowen and Co Global Transportation Conference.

Further, WestJet is looking to acquire new passengers who do not currently fly because of the price. In April, the company stated that it would launch the ultra-low cost carrier with an initial fleet of 10 Boeing Co 737-800s planes. The initial introduction rate was late this year, however the company has delayed the launch until next summer.

The service, modeled after other carriers like U.S.-based Spirit Airlines (NASDAQ:$SAVE), would follow a “low fare, pay for everything” structure, separate in name and in its marketing from WestJet’s existing airline.

As for revenue, the new carrier is speculated to generate twice the ancillary revenues earned by WestJet in the second quarter.

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