Murray Wood: Who's scary... and who's scary good?
Every Friday, Murray Wood takes a look at the week's news and decides who's hot... and who's not. This week, in a specia...
Lynx Air won’t be getting off the ground in Regina.
In mid-January, the self-described “ultra-affordable” airline announced it would start serving Regina in June. On Thursday night, Lynx Air revealed it had filed for creditor protection and was ceasing operations Monday at 12:01 a.m. MT.
James Bogusz, the president and CEO of the Regina Airport Authority, said Friday the news was “a very big surprise for all of us in the aviation industry.”
“(It was) very, very disappointing news,” Bogusz said. “Lynx has been making a number of major announcements, including recently Regina. It was going to be a nice reintroduction of an ultra-low-cost airline for our market, but it won’t be coming to fruition.”
In January, the Calgary-based airline announced it was planning to serve Regina with six weekly flights to and from Toronto and Vancouver. Tickets were to start at $79 for a one-way flight.
Bogusz said the company’s financial struggles weren’t disclosed to the Regina Airport Authority or to any other airports across the country that were served by Lynx Air.
“This is a volume-driven business,” he said. “Generally speaking, when these markets are announced, (airlines) will pre-book flights, they’ll kind of get a sense of the market (and) they’ll often operate for a period of time.
“Lynx had made a commitment to come between June and October in our market – that’s what they had stated as a starting point — and we know the advance bookings were quite good. We just talked to them quite recently and (there was) no hint that there was financial concerns.”
Bogusz said there’s a lot of competition in the aviation industry with the likes of WestJet, Air Canada, Porter and Flair and, as he put it, “inevitably, unfortunately, not everyone’s going to make it.”
“These are very volatile businesses — and in a good way, when they operate effectively,” he said. “But with news like you see (Thursday) and that we’re talking about now with Lynx, these business models obviously have some fragility to them. There’s clearly a challenge with them making enough profit to stay.”
Bogusz said WestJet and Air Canada have started slashing basic fares on some seats in hopes of competing with ultra-low-cost airlines. If that strategy succeeds, it could help make up for the loss of service from carriers like Lynx and Flair.
In a statement, WestJet said it’s ready to help mitigate some of the issues arising from Lynx’s departure. That includes offering discounted fares for stranded domestic travellers and capping fares for Canadian repatriation flights on non-stop WestJet routes previously served by Lynx.
As for people who had booked flights on Lynx out of Regina, Bogusz noted an FAQ on the airline’s website encouraged customers to contact their credit card companies for a refund.
“I’m not quite sure what that means – I’m used to the business itself doing the refund – so I guess customers will have to find that out,” he said.
— with files from The Canadian Press
