New Leaf Travel

[rudder]

I wish them the same luck that Porter has enjoyed. I well remember those on this forum who gave them a similar expiry time line.

The predictions are not borne out of animus. It is is a simple realistic acknowledgement that cash burn for any startup will be significant for some time to come. In Porter's case it was several years.

NewLeaf will need deep pockets. And do not expect AC an WJ to just sit and watch.

[Guest]

The predictions are not borne out of animus. It is is a simple realistic acknowledgement that cash burn for any startup will be significant for some time to come. In Porter's case it was several years.

NewLeaf will need deep pockets. And do not expect AC an WJ to just sit and watch.

Regarding their cost, ​​I guess that will be very dependant upon what their agreement with Flair is. It seems to me that it is Flair that has the most risk depending upon that. At this time their only advertised staffing needs are:

Current Opportunities

• Director of Pricing and Revenue Management
• Director of Airport Services
• Marketing Communications Manager- Hamilton
• Marketing Communications Manager- Kelowna
• E-Commerce Manager

Last Fall they were quoted as saying:http://www.winnipegfreepress.com/business/airline-launch-pushed-back-324304671.html

Quote

Canada's newest airline has started hiring, but it has moved back its launch date.

NewLeaf Travel Company, the Winnipeg ultra-low-cost carrier, has hired nine people for its head office and is working on the next six, CEO Jim Young said.

It has hired two pilots and 24 flight attendants, but they will be based out of Hamilton and Kelowna, B.C.

"This is our startup squad. Once we get operating, we'll continually grow," Young said.

"They're not factory workers. You grow based on how demand builds."

The company had planned to have its first plane in the air before the end of the summer but has had to delay the launch a couple of months due to the complexities of getting an airline off the ground.

"We had to make a decision where we said, 'Do we rush in the summer and not necessarily bring out the product that we really want or wait and deliver the product that we really want?'

"You only get one chance to make a first impression," he said.

The first plane to be based out of Winnipeg is expected to be operational early next year. Each plane used by NewLeaf results in the hiring of 36 employees.

Within the next 15 to 18 months, Young said the plan is to have eight planes and their 288 employees based here.

When NewLeaf announced its entry into the market in June, it said its long-term goal was to hire 750 people, including pilots, flight attendants, executives as well as people in finance, marketing, information technology, sales and distributions and maintenance.

NewLeaf has partnered with Flair Airlines, a charter company based in Kelowna with a quintet of 737-400 aircraft, to fly its schedule.

NewLeaf plans to lease more planes shortly after the launch with a goal of having a fleet of 15 in a couple of years. Flair does the hiring of the crews.

Young said until the Canadian Transportation Agency has given full regulatory approval, he doesn't want to release specific destinations but he said states such as California, Arizona, Nevada and Florida are on his radar for the winter.

"Our approach is to fly where others aren't and focus on secondary markets and airports with really low fares," he said.

Young said this week's decision by CanJet Airlines to suspend its operations will have no bearing on NewLeaf's plans as the Halifax-based carrier's business plan was different.

CanJet offered charter flights on behalf of Transat Tours from a number of Canadian cities to sun destinations, but the long-term contract wasn't renewed in April 2014.

Since then, it had been operating as a tour operator.

"CanJet used to be a scheduled carrier, but then they were flying planes for others and they attempted a tour business. That doesn't concern us. (Their decision) doesn't mean a downturn in the market," he said.

NewLeaf makes no bones about the fact its target market includes Manitobans who drive to North Dakota to fly with Allegiant Air out of Grand Forks or Fargo.

The goal of carriers in the ultra-low-cost space is to eliminate or reduce as many expenses as possible. That means no meals, complimentary snacks or entertainment and likely walking or busing out to the plane on the tarmac.

At its bare bones, customers get a seat and a seatbelt.

Customers who request some of these or other services, such as a rental car or a hotel room at their destination, will be able to get them through NewLeaf at extra cost.

NewLeaf is preparing to renovate the former rental car facility at the Richardson International Airport and will use 7,000 square feet of space.

End quote

So did they actually hire that staff????

[ModerateChop]

Let the games begin !

Friday, February 12th, NewLeaf launch day

cheapest available webfares

Hamilton - Saskatoon

NewLeaf - $119.00 nonstop

WestJet - $118.79 via Calgary

Air Canada - no flights

Toronto - Saskatoon

NewLeaf - no flights

WestJet - $118.79 nonstop

Air Canada - $272.00 nonstop

Abbotsford - Saskatoon

NewLeaf - $89.00 nonstop

WestJet - $72.58 via Calgary

Air Canada - no flights

Vancouver - Saskatoon

NewLeaf - no flights

WestJet - $187.03 via Calgary

Air Canada - $187.00 nonstop (Jazz)

Kelowna - Saskatoon

NewLeaf - $89.00 nonstop

WestJet - $83.08 via Calgary (Encore)

Air Canada - $179.00 via Calgary (Jazz)

Saskatoon - Hamilton

NewLeaf - $119.00 nonstop

WestJet - Econ Fare sold out, $607.00 Flex Fare, via Calgary

Air Canada - no flights

Saskatoon - Toronto

NewLeaf - no flights

WestJet - $317.23 nonstop

Air Canada - Tango Fare sold out, $413.00 Flex Fare, nonstop

Hamilton - Halifax

NewLeaf - $99.00 nonstop

WestJet - $97.32 from Toronto

Air Canada - $232.00 from Toronto

looks like WestJet is in fighting mood, Air Canada sitting back for now.

[Guest]

Re the pricing it will be indeed interesting to see how many folks will book Westjet out of for example YXX or YVR to Saskatoon for the $72.58 with only carryon and then simply deplane in YYC which on the same day and flight, Westjet is marketing at $137.68 ex YXX and $187.00 ex YVR.

I would not be surprised if WestJet's pricing was investigated by the Competition Bureau as was done in 2001 when it looked into the fares being charged by AirCanada.

Posted Wed Mar 7 2001 01:31:35 your local timeWed Mar 7 2001 00:31:35 UTC(14 years 10 months 1 week 2 days 17 hours ago) and read 6085 times:

MONTREAL, March 6 (Reuters) - Air Canada's (Toronto:AC.TO - news) (NasdaqNM:ACNAF - news) dominance of the Canadian airline sector is being challenged in court by the country's antitrust watchdog, which has charged it with predatory pricing against two smaller rivals.

Canada's Competition Bureau has asked the Competition Tribunal, a specialized court that rules on antitrust matters, to issue an order prohibiting Air Canada from pricing its fares below cost in Eastern Canada.

Air Canada's pricing changes are squeezing low-cost carriers CanJet, of Halifax and Calgary-based WestJet (Toronto:WJA.TO - news) out of the market, the bureau said.

In October, the bureau ordered Air Canada to stop offering discounts on five routes in Eastern Canada.

[Fido]

Starting in the airline business without someone to head the 'Pricing and Revenue Management"

[Guest]

Despite what the title of this story says, it seems to me that the new carrier will be more of a threat to WestJet than to AirCanada.

No-frills airline NewLeaf faces ‘dogfight’ with Air Canada, WestJet

By Jamie Sturgeon Consumer Affairs Reporter Global News

NewLeaf Travel, the upstart airline that plans to offer service between seven Canadian cities at sharply lower prices compared to what Air Canada and WestJet charge for similar flights, can expect a “dogfight” with the bigger airlines, experts say.

And that’s a good thing for travellers, who should benefit from the added competition once NewLeaf begins flying next month.

“Regardless of NewLeaf’s long-term success, a new entrant into the market will at the very least mess with the incumbents’ pricing power,” airline analysts at financial services firm Raymond James said Thursday, a day after the Winnipeg company announced launch plans.

Starting Feb. 12, NewLeaf will provide flights at deeply discounted prices to Halifax, Hamilton, Winnipeg, Regina, Saskatoon, Kelowna and Abbostford, B.C. One-way tickets will range from $89 for shorter flights to $149 for longer trips.

No frills

The startup carrier’s business plan is based on the “ultra-low cost” model that’s been highly successful in the United States and Europe. Base fares will be for bare-bones service — basically the seat — with multiple add-on costs offered on everything from seat selection, baggage, printed boarding pass, and more, experts say.

MORE: ‘Ultra-low cost’ airline NewLeaf takes flight next month

The new airline will use a fleet of four Boeing 737-400s, configured with 158 economy seats — planes that are being provided by a third-party, Flair Airlines, an established charter carrier based in Kelowna.

That’s what experts know about the little-known airline, as well as the fact that it’s run by Jim Young, a former exec of Frontier, a successful discount airline south of the border. What’s not known is the whether NewLeaf can remain a thorn in the side of Air Canada and WestJet, giving Canadian travellers another, cheaper option to get around the country.

Experts suggest the current economic environment isn’t an ideal one to launch a new airline.

“The economy is much weaker, which invariably crimps demand for travel — to the unemployed it doesn’t matter how low fares are,” Raymond James analysts said.

WATCH: Breakdown of NewLeaf airlines additional costs

‘Dogfight’

Both Air Canada and WestJet are also expanding their own regional services, a process that’s already lowering airfares for travellers as the two compete with one another.

“The market is now awash in excess supply,” Raymond James’ Ben Cherniavsky said. “As a result, fares in Canada have come under considerable pressure, making the case for an ultra-low fare entrant much less compelling than it used to be.”

Air Canada and WestJet are sure to respond to NewLeaf’s arrival, meaning the airline faces months, at least, of financial pressure as it establishes itself.

NewLeaf “must have a well-capitalized balance sheet to withstand the competitive response that its pricing strategy will surely elicit,” Cherniavsky said.

David Tyerman, another airline analyst at Canaccord Genuity mirrored the sentiment. “We are unclear whether whether NewLeaf has the financial resources to withstand a dogfight with Air Canada and WestJet,” Tyerman said.

Requests for comment from NewLeaf weren’t responded to.

Story Link: http://globalnews.ca/news/2439498/no-frills-airline-newleaf-enters-dogfight-with-air-canada-westjet/

[Guest]

The expert quoted in this article has a track record of challenging airline tariffs etc. and getting them changed and that has been good for the consumer.

In the story he advises to avoid NewLeaf because it doesn't have a tariff on file but of course since they are only operating a Domestic Service, there is no requirement for them to do so. Quote from CTA WebSite: Domestic tariffs, for transportation between points in Canada, do not need to be filed Endquote

Avoid new ‘ultra low-cost’ airline, passenger advocate warns

By Steve Morales Web Writer Global News

A new “ultra-low cost” Canadian airline is presenting an attractive new travel option, but one passenger advocate is warning travellers to avoid those tempting fares.

NewLeaf airlines officially unveiled its new deeply discounted routes Wednesday, offering flights from Halifax, Hamilton, Winnipeg, Regina and Kelowna, among others, for prices ranging from $89 to $149.

Related

However, air travel expert and passenger champion Gabor Lukacs warns there are “serious, serious issues” with the company and recommends passengers refrain from jumping at tempting fares.

READ MORE: ‘Ultra low-cost’ Canadian airline takes off next month

Among the most troubling problems, Lukacs says, is the absence of a detailed and legally compliant tariff. The tariff, also known as a contract of carriage, spells out airline liability and passenger rights, essentially acting as the small print on your ticket.

Lukacs sells the airline’s carriage conditions don’t properly cover important issues including overbooking policy, passenger rerouting or baggage liability.

“There are serious liability issues and the airline does not comply with what the law says,” he told Global News.

“I welcome more competition but until they get those things worked out, I urge people not to fly with them.”

Those issues aside, Lukacs also expressed scepticism about the airline’s business plan, which involves flying from “smaller and secondary airports,” and also bypasses major hubs like Toronto and Montreal. The business plan has worked for similar discounted operations in Europe, but Lukacs says it still presents risks.

“Certainly it is worth trying since it may reduce competition,” Lukacs said. “But you wonder who will be their customers? Having a stopover at a small airport is a very good idea but only flying into small airports, what kind of markets are you picking up?”

NewLeaf is embarking on a risky venture, as low-cost airlines have poor track record in Canada. Two discounted carriers, SkyGreece and CanJet, ceased operations within days of each other last summer, joining other failed ventures such as JetsGo, Zoom Airways, Roots Air and VistaJet.

NewLeaf did not respond to to repeated requests for comment on this story.

Story link: http://globalnews.ca/news/2437629/avoid-new-ultra-low-cost-airline-passenger-advocate-warns/

[Moon The Loon]

Don't know if it's been brought up in this thread (haven't read the first page). Flair has been doing First Air flights for over a year. Have flown on them half a dozen times to Iqaluit. They seem to have a very professional operation, friendly onboard staff and well flown sections (from myself as observant passenger perspective).

I understand that all this new start-up's flight will be operated by Flair.

Has any start-up ever used charter flying like this rather than hire and train its own people to operate the flight ops side of the business?

Not having to pay for lease, pilots, cabin crew, maintenance and training would make a HUGE difference in any airline's costs.

Just askin'...

[Lakelad]

Greyhound for sure and I think Roots as well (both pretty short lived).

[blues deville]

Has any start-up ever used charter flying like this rather than hire and train its own people to operate the flight ops side of the business?

Just askin'...

Apple Vacations who worked with C3 in the airline's last few years have gone back to finding lift wherever available. This winter season they have contracted Iceland Air. Prior to their deal with C3 I was told their contracted airlines wouldn't even show up on departure day. USA 3000 (Apple Vacations) was borne out of some of the ashes of C3 with Angus Kinnear at the helm and lasted a few years before shutting down. This formula seems to have difficulties in the states. Perhaps too much competition from more reliable US major airlines.

[mo32a]

A new entrant in the ULC race to Europe starts today. Wow Air, an Icelandic ULC will start with one way fares to Reykjavik for $99, from San Francisco and LAX and other east coast locations, where they can connect with Wow's flights to London, Paris and Berlin and others for $199.

In May they will begin flying from Montreal and Toronto.

[blues deville]

A new entrant in the ULC race to Europe starts today. Wow Air, an Icelandic ULC will start with one way fares to Reykjavik for $99, from San Francisco and LAX and other east coast locations, where they can connect with Wow's flights to London, Paris and Berlin and others for $199.

In May they will begin flying from Montreal and Toronto.

Perhaps new to the ULC game however I think they've been in business for a few years connecting Iceland to European destinations.

[Guest]

Their selling point is that you can get a stopover in Iceland for no additional cost when using them from Canada to Europe and their fares to Europe are quite a good deal.

[Moon The Loon]

Wonder if they'll charge for using the Loo!

Instead of a Pound A Pee (Ryanair), it would be a Loonie A Leak!

[Fido]

Their selling point is that you can get a stopover in Iceland for no additional cost when using them from Canada to Europe and their fares to Europe are quite a good deal.

The same as IcelandAir

[Guest]

New Leaf may cause the CTA to change how they deal / rule with bulk seat buyers.\

Low-cost upstart NewLeaf Travel Company can fly without licence for now: regulatorJanuary 15, 2016 12:25 PM ET

Peter Power/The Canadian PressDean Dacko, Chief Commercial Officer of NewLeaf Travel speaks at a press conference in the arrivals area of the John C. Munro Hamilton International Airport, on Wednesday, Jan. 6, 2016. NewLeaf is within legal bounds in operating without a domestic service license, regulators confirm.

NewLeaf Travel Company, the first of a new wave of ultra-low-cost airlines, which launched last week, is within legal bounds in operating without a domestic service license, regulators confirm. And the company maintains that it is not taking any chances by not having one — although, the government agency that oversees the airline industry may decide the company will need one after the conclusion of a regulatory review.

Canada’s incumbent airlines have little to fear from a new, ultra-cheap competitor that will begin flying next month, according to an analysis by National Bank.

Citing “rapidly evolving” business models in the airline space, the Canadian Transportation Agency (CTA) is consulting with the public to determine what changes need to be made, if any, to the criteria used to evaluate licence requirements.

Specifically, the agency is focusing on companies like NewLeaf that “bulk purchase all seats on planes and then resell those seats to the public, but do not operate any aircraft.” NewLeaf sells tickets, but its flights, which begin in February, will be run initially by private charter company Flair Airlines Ltd., which provides aircraft, crew and the plane’s maintenance and insurance — known as a “wet lease.”

While the review is underway, the CTA said it would not require NewLeaf to obtain a licence. Under current rules, an “indirect air service provider” like NewLeaf, which contracts out the full operation of the aircraft, does not need a licence.

“I’ve never understood that to be in contravention of CTA’s regulation,” said airline industry consultant Robert Kokonis of the wet lease arrangement. “I think that it’s ludicrous that (NewLeaf) would be required to hold a licence.”

In an interview from Winnipeg, NewLeaf president and CEO Jim Young said a wet lease is ideal for a startup like his. “It’s the easiest way to apportion costs. If you did anything more complicated, it’s difficult to understand what it’s costing me to fly the airplane from A to B.”

Young said NewLeaf would apply for a licence if the CTA determines that it needs one.

There is no firm timeline for the CTA to make a decision. The agency said it depends on what kind of feedback it gets from the consultation, which ends on January 22, and the volume of responses.

Tim Morgan, CEO of Enerjet who is also backing another planned ultra-low-cost competitor, Jet Naked, does not believe NewLeaf can call itself an airline, although he said he would not file a challenge to the CTA about the licence.

“I don’t think I need to,” Morgan wrote in an e-mail. “This is no different than Greyhound.”

What Morgan is referring to is a precedent that casts a shadow over indirect service providers. In 1996, Westjet Ltd. filed a licencing complaint that ultimately grounded Greyhound Air.

WestJet accused Greyhound Lines of Canada Ltd., owned by the U.S.-based Dial Corp., and Kelowna Flightcraft Air Charter Ltd., which operated aircraft on Greyhound’s behalf, of “circumventing” the law by skirting foreign ownership restrictions.

WestJet also contended that Greyhound was piggy-backing on Kelowna’s licence and because Greyhound had commercial control of the operations, with no market risk to Kelowna, it bore the onus of getting licensed. The National Transport Agency, the CTA’s predecessor, sided with WestJet.

“This set a clear precedent that licensing requirement cannot be side-stepped,” Jim Scott, chief executive of Canada Jetlines Ltd., the other Canadian upstart with plans to launch, wrote in a letter to shareholders.

Scott argues that it’s unfair that Jetlines is going through the licensing process to prove its “financial fitness,” something he said NewLeaf was not required to do. While he has not filed a complaint with the CTA, Scott said he’s “considering all options.”

An important issue that the CTA will face is how adequately consumers are protected if an airline that contracts out flights cannot provide service due to escalating costs and needs to reimburse passengers. Young said NewLeaf has taken that into consideration.

“The money is all protected such that if we were unable to operate a flight, we’re not spending any of that money before the flight is operated, so we would be able to return it to the customers,” said Young.

Kokonis, co-founder of AirTrav Inc., doubts the CTA will stand in NewLeaf’s way, if the company sticks to its current model, but he said the CTA may choose to reassess NewLeaf if it decided to lease its own planes, or enter into a dry lease scenario, whereby Flair only provides the aircraft.

From an operational standpoint, Kokonis said it makes sense for an upstart to use wet leases to reduce capital costs until there’s enough cash to grow organically. “I think it’s a really smart way to go and it enables NewLeaf to get off the ground relatively quickly

[blues deville]

"I've never understood that to be in contravention of CTAs regulation, said airline industry consultant Robert Kokonis of the wet lease arrangement. I think that its ludicrous that (NewLeaf) would be required to hold a licence."

Perhaps but then what is New Leaf's area of responsibility? For example, if your baggage doesn't arrive at your planned destination, delayed or cancelled flight, is that Flair's problem? The people with a licence?

[dagger]

http://www.huffingtonpost.ca/2016/01/14/newleaf-airline-license_n_8985592.html

Gabor on New Leaf's case already. I think this article outlines the consumer's risk well.

One of the problems stems from confusion around baggage liability within NewLeaf's General Conditions of Carriage, says Lukacs.

"They have two separate statements about baggage and liability. One says $750, the other says $1,500. Then go to the bottom of the page and lookup Flair Airlines terms and conditions; they say $250," says Lukacs. "Now which of them is going to apply? Whichever is best for the airline?"

Chris Lapointe, Flair Airlines' vice-president of commercial operations, says his company is currently working with lawyers and the Canadian Transportation Agency to review Flair's tariff document, including baggage liabilities.

Lapointe says once the NewLeaf service begins, Flair's tariff document will be applied.

[Guest]

Seems that there is a silver lining for consumers but not for other airlines because of NewLeaf.

New budget airlines to keep WestJet, Air Canada on their toes Cheap new competition is 'very good for consumers,' transportation expert says

By Sheena Goodyear, CBC News Posted: Jan 18, 2016 5:00 AM ET Last Updated: Jan 18, 2016 5:00 AM ET

NewLeaf will have a fleet of 737s operating out of seven Canadian airports starting in February 2016. (NewLeaf)

NewLeaf Travel and other discount airlines are shaking up Canada's air travel industry, and that's good news for all passengers, analysts say.

NewLeaf, which bills itself as an "ultra low-cost airline," will start Flying between seven "underserved" Canadian cities on Feb. 12 with tickets as cheap as $79.

Icelandic carrier WOW Air will begin offering $99 flights to Iceland and $149 flights to European destinations from Toronto and Montreal in May.

Two other budget airlines — Jetlines and Jet Naked — are also hoping to get off the ground this year.

This proliferation of cheap flights has the potential to rattle an industry long dominated by Air Canada and WestJet, two companies that have developed a "cozy relationship" with similar prices and fees, says transportation economist Barry Prentice.

"The mere fact that we do have somebody coming in means that the airlines do have to recognize there is a credible threat there, and I think that's very good for consumers," Prentice, a professor at the University of Manitoba's Asper School of Business, told CBC News.

Price war

WestJet has already responded by lowing its ticket prices to undercut NewLeaf on many competing routes.

"We will vigorously defend our low fare leadership position in the market. Our success over the past 20 years demonstrates that Canadians love our unique combination of low fares and remarkable guest experience," WestJet spokeswoman Lauren Stewart said in an email.

Air Canada hasn't said yet whether it will follow suit, but spokesman Peter Fitzpatrick told CBC News: "We welcome competition and offer competitive pricing in every market we serve."

WestJet has dropped fares on select routes that compete with budget airline NewLeaf, like this Feb. 26 flight from Kelowna, B.C., to Saskatoon. (Screengrab/CBC)

The new low-cost carriers in Canada are copying the business models of successful budget airlines south of the border by offering cheap introductory fares and charging extra for things like printing a ticket, bringing aboard a carry-on or checking luggage.

"By unbundling the entire service, you get to choose what you want," NewLeaf CEO Jim Young said when he announced the airline's routes. "Ultra low-cost carriers are some of the most financially successful airlines in the world today."

Tickets are selling

It's too early to say whether Canadians will embrace this model, but they seem to be taking interest.

WOW spokeswoman Svana Fridriksdottir said its sales in Canada have been "a great success." She wouldn't give specific numbers, but says they've surpassed the booking rates of WOW's U.S. offerings, which had a load factor of 85 per cent throughout 2015.

Air travellers in Winnipeg, where NewTravel will be based, told CBC News they're eager to check it out.

Vancouver-based Jetlines and Calgary-based Jet Naked haven't started selling tickets yet, but both hope to begin operations this year — Jellines within six months, and Jet Naked by spring.

Discount airline WOW Air, which has already launched its Canadian ad campaign, has unveiled a plan to fly from Montreal or Toronto to Iceland for $99 one way and travel to numerous destinations in Europe for $149. (WOW Air)

Still, Prentice doesn't think these newcomers pose a serious threat to Canada's established airlines. ​Both Air Canada and Westjet have posted soaring profits and announced international expansions in recent months.

Through its subsidiary Rouge, Air Canada added a slew of sun international destinations in recent months, including Barbados, Nassau and Hawaii.

In 2016, Air Canada will add flights to Prague, Glasgow, Casablanca, Budapest, Warsaw and more than a dozen U.S, cities. WestJet is also expanding, and has added flights to Hawaii, while both airlines have added flights to Gatwick Airport near London.

NewLeaf, meanwhile, has only four planes flying between seven cities, none of which are major travel hubs.

"The more flights you have, the more places you go, the more attractive you are as an airline, which is why there's real benefit to being bigger," Prentice said.

Where others have failed

NewLeaf and its counterparts aren't the first to launch discount airlines in Canada. JetsGo, Canada 3000, Greyhound Air, Zoom Airlines all came and went.

Still, Prentice said these new airlines could succeed where others have failed.

"Fuel prices are low, which helps. And with the low Canadian dollar we may well see more people having staycations within Canada," he said, so they might be interested in low-priced domestic trips.

• NewLeaf Travel takes flight amid Canada's turbulent airline history
• Loonie troubles turn foreign getaways into Canadian staycations

Others are less optimistic.

Transportation analysis firm Raymond James described NewLeaf's entrance to the market as a "rather inauspicious opportunity with history stacking the odds against its long-term success."

Canada's airline industry is not kind to newcomers. Jetsgo suddenly ceased operations in March 2005, stranding an estimated 17,000 passengers right at the start of March break, one of the busiest travel times of the year. (Ryan Remiorz/Canadian Press)

In a research note to investors, Edward Gudewill and Ben Cherniavsky of Raymond James questioned the wisdom of opening a new airline amid a turbulent economy with a weak loonie and slumping oil prices.

"To the unemployed, it doesn't matter how low fares are," they wrote.

They also took issue with NewLeaf's winter launch and travel destinations.

"Launching a domestic-only operation in the middle of February seems like a tenuous proposition. Presumably cash will be very tight for a startup operation like this, which means it could be financially vulnerable for the first three months until seasonal demand picks up in Canada," they wrote.

"And as far as the strategy of flying to small, secondary markets is concerned, we remind investors that these are 'small' and 'secondary' for a reason."

Nevertheless, they predict savings across the board for travellers.

"Regardless of New Leaf's long-term success, a new entrant into the market will at the very least mess with the incumbents' pricing power, which has already been under considerable pressure."

Story Link: http://www.cbc.ca/news/business/budget-airlines-industry-reaction-1.3403446?cmp=rss

[dagger]

New Leaf has screwed up. It's refunding all of its advance sales pending a review of its licence by the CTA. Dumb things like this can be fatal. It smacks of bush league and rocks consumer confidence.

[Seeker]

New Leaf has screwed up. It's refunding all of its advance sales pending a review of its licence by the CTA. Dumb things like this can be fatal. It smacks of bush league and rocks consumer confidence.

I think you're giving the consumer too much credit. The same people who get stranded by "Bob's Discount Airline" one week will be the first to buy tickets on "Bill's Cheap Flightz" next week - some people never learn.

[Guest]

here is the story on their delay in launch:

NewLeaf discount airline postpones service, will refund tickets New carrier hopes to operate in spring after review of its licence conditions

CBC News Posted: Jan 18, 2016 4:01 PM ET Last Updated: Jan 18, 2016 5:17 PM ET

NewLeaf Travel Company, the new Canadian discount airline that launched Jan. 6, has had to postpone its plans to begin operations in February and will refund any reservations while its licensing is reviewed.

In a release today, the new air service said its position was "ambiguous," while the Canadian Transportation Agency reviews licensing of indirect air service carriers.

NewLeaf had a charter arrangement with Kelowna, B.C.-based Flair Airlines Ltd., with Flair holding the CTA operating licence, while NewLeaf sold the seats.

The transportation agency is reviewing whether persons who do not operate any aircraft, but market and sell air services to the public, should be required to hold a licence directly.

"Now, there is ambiguity in the air as to whether we need to amend the relationship with our air service provider, or whether we need to have a licence ourselves. While Canada has many other indirect air service providers, NewLeaf is in a unique position as we are the first large-scale [indirect provider]," said NewLeaf CEO Jim Young. "We welcome a regulatory system in which businesses like ours can thrive in Canada as they do in other countries."

He said the airline aims to resume taking reservations in the spring, but would refund all credit card charges so customers could make alternative travel arrangements.

Young said the fledgling airline was seeing huge demand. It was offering flights to seven Canadian cities, starting Feb. 12:

• Abbotsford, B.C.
• Halifax
• Hamilton
• Kelowna, B.C.
• Regina
• Saskatoon
• Winnipeg.

The Canadian Transportation Authority, which describes itself as an "independent, quasi-judicial tribunal and economic regulator," had previously given an all-clear to NewLeaf's proposed business model before the airline had a splashy launch and started taking reservations in January.

But it has never before agreed to allow a carrier to operate under an indirect licence held by another party. That provoked complaints from competing airlines and from consumer advocates.

Jack Branswell, a spokesman for the Canadian Transportation Agency, said it would be acceptable for Flair to set air carrier rates and offer seats for sale as it is "the licensed carrier in this situation."

It is calling for comments on a review that could set new terms for NewLeaf.

"As business models in the airline industry are rapidly evolving, the agency is currently reviewing whether companies who bulk purchase all seats on planes and then resell those seats to the public, but do not operate any aircraft, such as NewLeaf, should be required to hold a licence," Branswell said.

Jetlines and Jet Naked, two other discount carriers hoping to launch in Canada, are both in the process of applying for a carrier licence, something that requires a lot of up-front capital.

[Guest]

New Leaf has screwed up. It's refunding all of its advance sales pending a review of its licence by the CTA. Dumb things like this can be fatal. It smacks of bush league and rocks consumer confidence.

Dagger according to the CBC story it is the CTA that screwed up, if as the story reports it had given NewLeaf a go ahead to operate. But of course it is a news story. http://www.cbc.ca/news/business/newleaf-transport-canada-1.3409142?cmp=rss

[internet]

Grab the cheap fares WJ and AC matched before they yank them (if they haven't already)

[vrefplus5]

Too late Internet.