WestJet provides update on new strategic direction, with focus on being ‘resilient low-cost carrier’

WestJet on April 12 provided an update on its new strategic direction — announced in June 2022 — which has seen the airline pull back from Eastern Canada and transatlantic routes, placing more focus on its roots in the west as well as growing leisure and sun destinations. The Calgary-based airline also says it wants to focus on “providing affordable airfares as a low-cost carrier (LCC).”

Since the airline’s new plan was introduced last June, the carrier has partnered with the Alberta government to commit to doubling its Calgary offering to more than 20 million annual seats before the end of the decade, which includes basing all intercontinental Boeing 787 Dreamliner flying in Calgary. WestJet has also increased capacity at “most major and mid-sized airports across Western Canada,” the airline said in a press release. Moreover, 20 new routes and three new destinations have been introduced between Western Canada and the U.S.

In February this year, WestJet announced its largest ever network expansion from Edmonton, with new service to the U.S. and new domestic routes — as the carrier is aiming to increase Canada’s east to west connectivity.

However, February also saw WestJet suspend transatlantic service between cities in Eastern Canada and Europe, as well as Vancouver and Europe. That announcement followed several domestic route suspensions in Eastern Canada, which affected Halifax in particular. The airline cited “capacity constraints” as the reason for pulling back.

In the airline’s April 12 announcement, CEO Alexis von Hoensbroech said, “I want to be clear on this point, we will be growing in the East. Our growth in the East will focus on point-to-point travel to Western Canada, and all elements of leisure travel.”

He noted that once WestJet’s acquisition of Sunwing is concluded, the carrier will be better positioned as “Eastern Canada’s leisure airline.” The acquisition was approved by the Canadian government in early March, and is “subject to strict terms and conditions that are in the interest of Canadians,” a Transport Canada press release states.

Following the travel chaos over the 2022 holiday season, which saw thousands of customer service complaints to Sunwing due to delays and cancelations, the government concluded that the acquisition would “help maintain the stability of the [airline] sector as Sunwing will continue to provide more affordable vacation packages to Canadians, while being financially supported by WestJet.”

As part of its strategy to provide affordable fares as a LCC, the airline is placing focus on the fuel-efficient Boeing 737 as the “backbone” of its fleet. Currently, WestJet has the largest order book for new Boeing aircraft of any airline in Canada. In September 2022, the carrier announced a deal with Boeing for 42 737-10s and options for an additional 22 jets. According to WestJet, the 737-10 has “one of the lowest costs per seat among mid-range aircraft” as well as lower fuel consumption and reduced emissions.

Moreover, the airline recently operated the first revenue flight of one of its 737-700 aircraft featuring Aero Design Labs’ drag reduction kit. The kit — which addresses areas of interference drag around the fuselage — results in fuel cost savings of roughly $12,000 per month (based on an average of $3 per gallon).

Von Hoensbroech said, “We are now seeing the benefits of our new strategy coming to life across Canada.”

However, there appears to be turbulence ahead for the airline, as its pilots announced the opening of a strike authorization vote in early April.

According to a press release from WestJet’s pilot union, The Air Line Pilots Association, International (ALPA), WestJet’s pilot recruitment and retention issues “are largely due to the airline’s attempts to reduce costs by driving down pilot wages and refusing to address concerns over scheduling and poor working conditions.”

The press release continues: “Over the past six months, pilots have grown increasingly impatient with WestJet management, who has failed to seriously engage in contract negotiations.”

Results of the strike authorization vote are to be announced on April 18.