The ultra-low-cost airline Canada Jetlines (TSX-Venture:JET) has changed its strategy for serving the Lower Mainland after its planned launch later this year.
Jetlines chairman Mark Morabito, and former CEO Lukas Johnson, told Business in Vancouver last year that Abbotsford International Airport (YXX) would be the company’s base in the region.
On February 7, the Vancouver-based airline reversed course and announced that it has chosen Vancouver International Airport (YVR) to be its home airport and primary base of operations when it launches.
YVR was Jetlines' original preferred airport to be based out of in the Lower Mainland, back in 2014, when it announced that it planned to launch in the spring of 2015.
Plenty of executive changes followed and the company in 2016 vacated office space that it leased in the main terminal of YVR.
Jetlines said on February 7 that the Vancouver Airport Authority, which runs YVR, has confirmed that all slots required to supply Jetlines’ initial needs for its first two Airbus A320 aircraft will be available.
The company explained that it selected YVR as its future base for operations due to it being the second busiest airport in Canada, serving more than 25.9 million passengers in 2018, and it is the airport in the region with the largest catchment area.
“The Greater Vancouver area population, cost to operate from the airport, and transit accessibility, linked with the enormous tourist attraction that Vancouver has, provides Jetlines with a massive business opportunity,” said CEO Javier Suarez, who is relatively new on the job, and is the airline's third CEO in the past two years.
“Having launched more than 300 routes in my career with most of them out of primary airports, I have no doubt that the Vancouver airport will offer Jetlines the opportunity to launch, and profitably operate a large number of routes.”
YXX has so far been the airport in the region that has attracted ultra-low-cost carriers, which are airlines that offer base fares that are as low as possible. Extra fees are then added for any luggage, meals, seat selection or other add-ons. Flair Air and the WestJet Airlines Ltd. (TSX:WJA) subsidiary Swoop make YXX home and are Canada's two current ultra-low-cost carriers.
Some Swoop flights to Edmonton, for example, have a base fare of $9 including tax when booked months ahead of time.
YXX recently enhanced its appeal to all airlines by opening an expanded terminal at the end of January.
The City of Abbotsford-owned airport’s 14,000-square-foot expansion makes its terminal building 80,000 square feet. The number of seats past security has doubled to 600 from 300, and there are two additional gates, for a total of five.
Swoop president Steven Greenway, told BIV in late January that the secret to his airline’s success is flying out of what he called “secondary airports,” which are smaller than major airports and have lower fees. Unlike YVR, YXX has no airport improvement fee, and it has more affordable landing and terminal fees.
For Greenway, there is even more to like about Abbotsford.
“It’s a whole heap of stuff that adds up in lower costs and efficiencies,” he said.
He estimated that planes at major airports take 10 to 15 minutes to taxi to the gate after landing. At Abbotsford, he estimated, the time is closer to two minutes. That means less fuel is burned and there is less wear and tear on planes.
“[Secondary] airports are not so congested, so you’re not having to line up behind 10 other aircraft to take off. You go straight to the runway and take off.”
BIV asked Greenway if he was concerned about looming competition from Jetlines.
“For me, they’ll become serious when they launch,” he said. “Until they actually start flying, it is a moot point for me.”