Canada Jetlines, the latest airline to enter a crowded field, set to take off

The next airline hoping to pose a threat to the country's Air Canada-WestJet duopoly is slated to take its inaugural flight Thursday.

Canada Jetlines, a new startup airline headquartered in Mississauga, Ont., is scheduled to begin service with twice weekly flights from Toronto's Pearson International Airport to Calgary International Airport.

The airline said it will hold a ribbon cutting celebration to mark the occasion when its first flight arrives in Calgary Thursday morning.

Canada Jetlines bills itself as an "all-Canadian, value-focused leisure carrier." While Toronto-Calgary is its only scheduled route right now, the company's chief commercial offer, Duncan Bureau, said the airline plans to service the leisure market both domestically and trans border with flights to the Caribbean and the Americas.

The airline currently has one Airbus A320 and a second to join in December, with plans to expand the fleet to 15 Airbus A320s by 2025 at a rate of five aircrafts per year, said Bureau.

Low-cost carriers emerging

Canada Jetlines is Canada's newest, but not first, airline to emerge in the wake of the pandemic.

Edmonton-based Flair Airlines has been aggressively expanding in the last year and a half, and now serves 36 airports with 85 routes and a fleet of 18 aircraft.

Calgary-based Lynx, formerly known as Enerjet, launched last spring and said at the time it hoped to operate nearly 90 flights a week on nine routes by June, all within Canada.

WestJet also operates its own subsidiary low-fare airline, Swoop, which launched in 2018 and offers service to destinations in Canada, the U.S., Mexico and the Caribbean.

While these competitors operate under a low-cost, no-frills model, Canada Jetlines aims to differentiate itself with service to the premium leisure market, said Bureau.

He added he is critical of the business model being used by so-called low-cost carriers like Flair and Lynx.

"If you're charging fares at rates that are lower than the cost of parking your car at the airport, the economics just don't work and it's not sustainable," Bureau said.

The deepest pockets

Canada Jetlines plans to offer a premium experience to customers that include departure times that fit the preference of the consumer over the pilot and 174 seats in lieu of the standard 180 to provide increased comfort, said Bureau.

On its website, Canada Jetlines is advertising introductory fares starting at $99 for one-way trips between Calgary and Toronto for a limited time.

To compare, Flair offers one-way trips from Calgary to Toronto for $49, the same route starts at $99 on Lynx and you can fly from Edmonton to Toronto for $59 with Swoop, according to the companies websites.

The pandemic's ravaging of the mainstream airline industry is making it possible for startup airlines to obtain parked and inactive planes at a good price, said Rick Erickson, an independent aviation analyst based in Calgary.

Such is the case for Canada Jetlines, as the pandemic paved the way for the airline to hire available talent and acquire aircraft at a low cost.

"I think the ones who survive are going to be the ones who have the deepest pockets. It generally takes anywhere from 18 to 24 months for new airlines to start turning a profit, so with all of these new players coming onto the market, the question is 'who has the deepest pockets and who has the best business plan?"' said Erikson.

Bureau said Canada Jetlines plans to offer service in the U.S. within the next three months although any official offerings and dates have yet to be announced.

Canada Jetlines is an independent airline that is publicly traded on the NEO Exchange.