How is the Possible?

[J.O.]

Of course the title should have said how is THIS possible.

The latest domestic seat sale. Westjet and AC must be loving this (not)!

[CanadaEH]

A sign of desperation. Sunwing obviously did not learn from jetsgo.

[J.O.]

My problem with this kind of seat sale is that it puts an unrealistic expectation in the mind of the consumer. They see this and they expect that their next trip will be cheaper, and the next, and so on and so on.

It's time that our industry did a better job of educating the travelling public as to the costs of getting them safely and legally from point A to point B. They need to start realizing that those discounts mean something is getting cut somewhere, and they should wonder if those cuts could affect their safety.

[Lakelad]

Cool - taxes are 3x the fare.

[zipped]

taxes 3 times fare.

Thats another problem.

[CAT3DUAL]

If I were the Feds/employee's this would be a glaring red flag telling me all is not well. How many people found themselves on the wrong side of the country when JG failed and expected the gov to get them home.

[Thebean]

If I were the Feds/employee's this would be a glaring red flag telling me all is not well. How many people found themselves on the wrong side of the country when JG failed and expected the gov to get them home.

There is an old saying that you are only as smart as your dumbest competitor, and Sunwing is pretty dumb. They apparently also have lots of empty seats.

I'd love to see how you revenue manage a $29 fares into an average fare trans - con that covers the economic costs of operating with $70 oil. For the record, that's about $165 each way on a 2000 mile sector for a carrier like Sunwing.

The last time $29 fares made money for an airline in Canada was when oil was $20, airport fees were far lower, and the route was 162 miles from Calgary to Edmonton. That was 1996.

The smartest thin Sunwing could have done is to make sure they ordered aircraft with the same cockpit and PSU config as WJA so that when they fail, WJA can take over the leases or buy them outright.

[better4me]

Sunwing appears to be taking a page from the LeBlanc school of airline advertising. A) It is impossible to get fares under $100 both ways. '' The taxes line is outrageous at $180 on my YVR-YHZ 'booking'. AC has the same level of taxation, but the base fare is 3 times the price with GST making 40% of the taxes amount. I suspect a fule surcharge in the taxes and fees column. C) $29 also was not attainable, lowest was $49 for one flight and over $100 for the rest.

[Lakelad]

Should maybe choose their parking spots carefully as well....

High Court Says Airport Authorities Can Seize Planes from Bankrupt Carriers

Terry Pedwell - Canadian Business News

June 9, 2006

OTTAWA (CP) - The Supreme Court has affirmed a law that allows airport authorities to seize aircraft from bankrupt carriers, even if the planes are leased. But in a ruling loaded with technical twists and turns, the court said Friday that aircraft leasing companies are not responsible for landing fees and other fees owed by airlines that go belly up.

The case involved the bankruptcies of Canada 3000 and Inter-Canadian Airlines.

After the carriers went broke, Nav Canada and a number of airport authorities had sued for the right to seize the airplanes operated by the companies, and to retrieve money owed for landing and navigation fees.

Had the high court ruled against the authorities, solvent airlines that are currently operating may have been forced to increase ticket prices to help recover more than $30 million owed by the two bankrupt carriers for landing and navigation fees.

In a unanimous 7-0 decision, the high court ruled that, while companies that leased aircraft to the now-defunct airlines are not liable to pay the outstanding fees, the authorities had the right to seize the airplanes to recover what was owed.

"The legal titleholders are not subject to personal or corporate liability to pay the unpaid charges," Justice Ian Binnie said in the written ruling. "(But) the appellants are entitled to obtain judicially-authorized seize and detain orders to be exercised against the security posted in substitution for the aircraft."

That puts aircraft leasing companies in a bit of a bind. And it could mean changes to future lease agreements to require millions of dollars in deposits from carriers to ensure outstanding fees are paid if they go broke.

Canada 3000 filed for court protection from its creditors in early November 2001. It went bankrupt just a few days later. At the time, it owed $13 million in landing fees to the Greater Toronto Airport Authority, $8.35 million to other airport authorities and $7.4 million in navigation fees to Nav Canada. To retrieve the money, the authorities seized 36 leased airplanes worth roughly $1.1 billion U.S.

In December 2001, an Ontario court ruled that the planes must be returned to the leasing companies, but forced the corporations to set aside $33 million to pay the landing and navigation fees.

In the case of Inter-Canadian, which went bankrupt in November 1999, a Quebec court ruled that Nav Canada and the other authorities could seize the bankrupt company's leased planes. That decision was overturned under appeal, and the leasing firms were made to post bond for $5 million in owed fees.

The high court ruling means both cases will now go back to lower courts to decide how the outstanding fees, which were set aside under previous court decisions, will be distributed to the airport and navigation authorities.

Nav Canada, which provides civil air navigation services across the country, welcomed the ruling.

"This Supreme Court decision will further reinforce our credit and collection capability," William Fenton, the company's vice president and CFO said in a statement.

Nav Canada said the decision will allow it to recover $8 million in unpaid charges from Inter-Canadian and Canada 3000, which was accounted for in previous financial statements.

[Maverick]

Well, the way I see it is this, if a leasing company wishes to place an aircraft with a carrier then they should maybe do their due diligence or not give them the aircraft to begin with. Too many lessor's know that for 6 months or two years or whatever they'll get their payments but long term??

Putting a financial penalty on their action may make them think twice.

A lot of the new airlines have that "NO MONEY DOWN!!" sort of mentality that makes them non accountable to their creditors and that pisses me (and the public) off.

[handyman]

With fares like that, I would say it's time to conduct a safety audit!

[Guest rattler]

With fares like that, I would say it's time to conduct a safety audit!

Maybe, just maybe, since the summer season is not as active for packaged holidays as winter..... they are operating the aircraft as a loss leader to build up their customer base and with any luck get their next vacation trip???? After all they have been in business for over 20 years ....... but operating their own aircraft is quite recent.

Just sorry they are not flying out of YYC with those fares. If the service is as described, I would love to sample it.

This past November 2005 marked a company milestone with the launch of Sunwing Airlines. Our new airline will enable you to fly better three ways…better price, better comfort and better performance. Sunwing Airlines will exceed Canadian and International aviation standards, while providing you with our superior on-board amenities, as you fly better with Sunwing. Our Sunwing Elite in-flight service offers many amenities including complimentary glass of champagne, upgraded meal service, in-flight entertainment, wine with meals, and comfortable leather seating throughout the aircraft. With the launch of Sunwing Airlines, we will set the benchmark for Canadian leisure air travel.