J.O. Posted August 15 Share Posted August 15 I feel for those folks who are facing an uncertain future - for some, for the third or fourth time. https://www.msn.com/en-ca/news/canada/canada-jetlines-halts-operations-plans-for-creditor-protection/ar-AA1oR5uU?ocid=entnewsntp&cvid=720f3b68afcf491aa385d298765d21a4&ei=26 Link to comment Share on other sites More sharing options...
Malcolm Posted August 15 Share Posted August 15 From the CBC Canada Jetlines grounds all flights, plans to file for creditor protection | CBC NewsMore ·Updated Canada Jetlines grounds all flights, plans to file for creditor protection Airline says it could not raise the financing needed to keep flying Jenna Benchetrit · CBC News · Posted: Aug 15, 2024 10:09 AM MDT | Last Updated: 21 minutes ago The future of Canada Jetlines is in doubt as the leisure airline has temporarily ceased operations and plans to file for creditor protection following an exodus of executives. (Canada Jetlines) Canada Jetlines is grounding all flights and says it is temporarily ceasing airline operations, effective immediately, making it the latest carrier to signal distress within Canada's troubled commercial airline industry. The airline says it has been unable to find the financing needed to keep flying and plans to file for creditor protection. Passengers with existing bookings should contact their credit card company to secure refunds, according to the company. The shutdown follows the resignation of four executives on Monday, including CEO Brigitte Goersch. It marks yet another airline departure from Canadian skies after the closure of Lynx Air and budget carrier Swoop within the past year. Canada Jetlines, which is headquartered in Mississauga, Ont., serves Canadians flying within the country or to sun destinations in the U.S., Caribbean and Mexico. It launched its first flight in September 2022. The carrier provides charter flights to sports teams and companies and leases its fleet to other carriers in the summertime. Its former CEO Eddy Doyle characterized it as leisure airline, though it was originally conceived as an ultra low-cost carrier. That business model was ultimately shelved, partly because the starting price for discount carriers in Canada "is composed of a lot of taxes," and partly due to the challenges of competing with Air Canada and WestJet, Doyle told CBC News in February. Calgary-based, low-cost airline Lynx Air has ceased operations, citing rising costs among reasons for the closure. McKenzie McMillan, a travel consultant with The Travel Group, tells BC Today host Michelle Eliot that Canadian airlines struggle more than their U.S. counterparts because fewer people travel longer distances between urban areas. At the time, Doyle said he thought there was "enough supply there to meet demand for the Canadian travelling public," with Air Canada, WestJet and Air Transat back at full-strength following the disruptions prompted by the COVID-19 pandemic. But he added that any new entrants would be fighting for the same portion of the market. Doyle announced his retirement in June. Goersch then took over as chief executive. 'It's a sign of the times' Aviation expert John Gradek told CBC News that the airline had "been on the edge for months." "When you look at their pattern of operations and their pattern of funding ... to me it was a surprise that they didn't get their licence pulled by Transport Canada earlier," said Gradek. "These guys had six airplanes and a couple hundred people, and they were just going month-to-month, trying to scramble and get as much cash as they possibly could to meet the payroll and the lease cost on the airplane[s]," Gradek said.He said it was only a matter of hours after the executive exodus on Monday that the airline would collapse. "It's a sign of the times. We have a problem in terms of commercial aviation in Canada," Gradek added. "People were spending five, six, $700 to buy a ticket on an airline that, in my opinion, was on pretty shaky ground. That, to me, is a failing of our transportation policy [and] practices." Trading of company shares on the NEO Exchange was halted late yesterday afternoon. Link to comment Share on other sites More sharing options...
Malcolm Posted August 15 Share Posted August 15 Perhaps a time to step back and cancel deregulation of Airlines and Routes? The domestic airline industry in Canada has evolved from being an Air Canada (formerly Trans-Canada Airlines) monopoly to being virtually deregulated. This change came about for two reasons. The first was the growing demand from air carriers during the mid-1970s for less government regulation and more competition. Canadian airline industry (89-2E) publications.gc.ca/Collection-R/LoPBdP/CIR/892-e.htm 1 Link to comment Share on other sites More sharing options...
J.O. Posted August 15 Author Share Posted August 15 That would be a violation of our commitments to NAFTA / CUSMA Link to comment Share on other sites More sharing options...
Malcolm Posted August 15 Share Posted August 15 1 hour ago, J.O. said: That would be a violation of our commitments to NAFTA / CUSMA So it would appear are the new US tax on softwood lumber. Time to review the NAFTA /CUSMA agreement . regarding any pro or con regarding Canadian airlines. Covid is past? but the industry does need a review in light of the current economy How flying became more affordable but less luxurious after deregulation : Planet Money : NPR Carefully crafted re-regulation could help our airlines survive (irpp.org) Link to comment Share on other sites More sharing options...
Tango Foxtrot Posted August 15 Share Posted August 15 Swoop never was an airline. It was, and still is Westjet. Link to comment Share on other sites More sharing options...
Rich Pulman Posted August 15 Share Posted August 15 Too bad Jetlines couldn’t have hung on until September 18th. 1 Link to comment Share on other sites More sharing options...
Specs Posted August 16 Share Posted August 16 18 hours ago, Malcolm said: The shutdown follows the resignation of four executives on Monday, including CEO Brigitte Goersch. I never knew she was Klaus' wife. Could be part of the problem right there. 1 Link to comment Share on other sites More sharing options...
Airband Posted August 16 Share Posted August 16 On 8/15/2024 at 2:06 PM, Malcolm said: Perhaps a time to step back and cancel deregulation of Airlines and Routes? No political will for putting toothpaste back in the tube. Lower airfares trump market stability. Link to comment Share on other sites More sharing options...
boestar Posted August 23 Share Posted August 23 Time for people to realise that unless you have a really big Scrooge McDuck Vault of gold and cash, you don't start an airline in Canada. How many times in my career have I seen this scenario play out. I don't have enough fingers. 2 1 Link to comment Share on other sites More sharing options...
st27 Posted August 23 Share Posted August 23 Most people have no idea how much an aircraft costs, the logistics, the infrastructure,or the federal rules around crewing…they just want to fly anywhere for $150! Link to comment Share on other sites More sharing options...
boestar Posted August 26 Share Posted August 26 The primary failure of the LCC in Canada is the inability to react and rectify in a IROP situation or OOS Aircraft situation. In order to efficiently move passengers you must be able to "cover off" IROPS. This requires a fleet large enough that you can re-route or replace aircraft. LCCs in Canada have a long history of not being able to do that. An aircraft takes a mechanical delay which becomes an out of service event that could last days, all of a sudden you have dozens of flights that do not have an aircraft. This causes Mayhem (and Money) along with bad press. One option is to rebook passengers on other airlines which is supposed to be the immediate option. 2nd is to Wet Lease an aircraft to cover off the flying. This is a pricey option but best suited to get passengers where they need to be. Larger Airlines like AC and WJ are able to recover faster because of overlaps in the schedule which can allow minor delays to help correct the big ones. On a good day those minor delays iron them selves out, on a bad they get worse. In the end though the passengers all move. Bad press still abounds but very little extra money is spent to cover it off. If you are really lucky there is an operational spare waiting for a situation like this. The old adage "You have to spend money to make money" is very true if you want a successful airline. I believe, in the current market, if an airline like AC said "no bag fees, everyone gets a meal on flights over XXX, etc etc" just like the 70s and 80s. They would be the most successful airline and rake it in hand over fist. Give the people what they want and not the shareholders and they will flock to your door. The margins will be far lower but you will make that up in Volume. Just MHO 1 Link to comment Share on other sites More sharing options...
Rich Pulman Posted August 26 Share Posted August 26 Canada Jetlines persistently had two jets sitting on the ramp at the north end on CYYZ for months. IROPS wasn’t a problem as they had spare lift. Indeed, they helped clean up the Sunwing debacle last winter. They just didn’t have any viable routes. Two jets in Europe this summer still didn’t cut it. For a company that spent 10 years in the planning stage, they sure sucked in the execution stage. Sadly it’s John & Jane Employee who end up paying a heavy price. 1 Link to comment Share on other sites More sharing options...
conehead Posted August 27 Share Posted August 27 3 hours ago, Rich Pulman said: Sadly it’s John & Jane Employee who end up paying a heavy price. As always. 1 Link to comment Share on other sites More sharing options...
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