Jetlines Canada is looking to enter the Canadian air travel market as an Ultra Low Cost Carrier. Having raised the necessary funding, the airline is looking to fully launch upon delivery of its aircraft in the first half of 2019. With 5 routes initially covering Canada exclusively, the airline plans to branch out across North America.
The airline aims to become Canada’s first ultra low cost airline. Aiming to deliver the best value and service. They aim to achieve this with a simple and friendly customer service. The airline has already gained the backing of the Canadian government. Canadian laws mean that foreign investment in the airline would be capped at 25%. However, The airline successfully lobbied for an exemption from 25% to 49%.
At Canada Jetlines, our mission is simple: To provide Canadians with the best value in air travel with a focus on safety and reliability.
Jetlines Canada aims to serve millions of Canadians living in unserved or underserved markets. Claiming that it is often cheaper to drive to the US and take a flight, they aim to offer low fares to two key hubs in Canada. From these hubs they will offer flights down into the rest of North America. First of all they will offer flights from Hamilton to 5 destinations. After going through 2 growth phases including adding flights to the United States, they finally want to add connections to Mexico.
The Low Cost Model
Mirroring airlines such as Ryanair and EasyJet, Jetlines wants to fly to secondary airports. Secondary airports charge much lower fees to try and attract traffic, therefore appearing favourable to low cost airlines. Using the ultra low cost model the airline predicts its costs will be 40% lower than WestJet and Air Canada. Likewise, they also plan to offer fares that are 50% less than these airlines.
Low cost airlines are able to keep fares and costs down using a variety of methods. Firstly, they offer unbundled fares. That is to say that you only pay to travel on the aircraft. They take the opportunity to sell a variety of extra services such as priority boarding, and seat reservations. Both services costing the airline nothing to offer during the flight. The also significantly mark up other services. Because they sell food and drink onboard at an inflated cost, they are able to make much more of a profit off of it.
The airline will launch with two leased A320 aircraft from AerCap. Each of the A320 aircraft contains 180 seats. The airline also ordered 5 B737-MAX directly from Boeing in December 2014. Delivery of the new B737-MAX aircraft is expected in 2023.
Whilst there is currently no firm launch date for the aircraft CEO of the airline Lukas Johnson said “Everything is green light for us as far as getting up and off the ground” and “Certainly we want to get going as soon as possible”. If all goes to plan, this time next year, Canada’s first ultra low cost carrier will have taken to the skies!
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