WestJet or Air Canada?

Airline analysts have speculated for months about the possibility of Air Canada filing for bankruptcy protection.

Airline analysts have speculated for months about the possibility of Air Canada filing for bankruptcy protection.

If that happens, the company will surely be restructured to fly another day, but it certainly begs the question: why is Air Canada in so much financial trouble today?

WestJet Airlines continues to post relatively good numbers and is apparently making money with fuel costs having declined considerably since last summer.

The firm’s focus on low-cost flying is a good fit for the current economic recession, perhaps a better fit than Air Canada’s attempt to be all things to all people.

New Air Canada CEO Calin Rovinescu, with barely a week in the job, promises to improve labour relations and streamline operations, while striving to avoid bankruptcy protection.

But industry experts note he’ll be hard pressed to do that given the company’s $3.2-billion pension deficit, expiring labour contracts and $5.4 billion of debt.

As well, fierce domestic competition from WestJet is expected to be hard on Air Canada.

Admittedly, the airline industry is extraordinarily competitive and even in the lucrative American market, many of the players have gone under.

But if you want to get a sense for why Air Canada is in such trouble, it’s useful to consider why WestJet has been so successful.

The Calgary-based carrier recently rolled out a lowest-price guarantee to lure cash-strapped consumers back to the skies.

During the Christmas season, it made a lot of friends by spending $2 million in six days to care for guests stranded across the country by winter weather.

Air Canada, on the other hand, basically told its stranded passengers that they were on their own with no prospect of a food voucher or free hotel room.

WestJet was not required to provide meal vouchers or hotel accommodations for passengers delayed by inclement weather, but it did so anyway.

As part of the $2 million, it paid for more than 6,000 hotel rooms, provided 25,000 meal vouchers and spent $250,000 on taxis and buses to assist passengers.

Furthermore, it chartered airplanes from third-party airlines to ensure its passengers got home for Christmas.

One can only hope Air Canada CEO Rovinescu learns a thing or two from WestJet. If he doesn’t, his company may end up filing for bankruptcy protection for the second time in six years.

Rovinescu recently issued a cheerful memo to employees downplaying the possibility of the airline going bankrupt.

No doubt, he’s under tremendous pressure to reassure customers who are fearful of buying tickets from an airline that may fail financially.

On routes served by both Air Canada and WestJet, it’s hard to imagine why anyone would fly Air Canada.

WestJet treats its passengers like valued guests and appears willing to go out of its way to assist them.

Air Canada, on the other hand. . . . Well, if you’ve flown Air Canada in the past few years, you already know enough about its service.

Lee Giles is an Advocate editor.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

End of CERB means uncertainty for some, new system for others

In its place is employment insurance, which the government says the majority of people will go on

The latest numbers on COVID-19 in Canada for Sept. 27

The latest numbers of confirmed COVID-19 cases in Canada as of 4:00… Continue reading

WE Charity controversy prompts examination of group’s overseas footprint

On Sept. 9, WE Charity said it would wind down its Canadian operations

Two people dead after plane flying from Rocky Mountain House crashes

The Transportation Safety Board will be investigating

Annual Chili Cook Off raises money for Red Deer Hospice Society

The key to making a great chili is preparing the sauce first,… Continue reading

QUIZ: Do you know what’s on TV?

Fall is normally the time when new television shows are released

Canadian ski resorts wrestle with pandemic-vs.-profit dilemma as COVID-19 persists

CALGARY — Canadian ski resort operators planning for a season that begins… Continue reading

Tenille Townes, Dean Brody and Brett Kissel top nominees at tonight’s CCMA Awards

OTTAWA — Tenille Townes could be lined up for some major wins… Continue reading

Horgan, Wilkinson trade barbs over MSP premiums, health care at campaign stops

TERRACE, B.C. — Health care in the era of COVID-19 took centre… Continue reading

Watchdog to investigate fatal Winnipeg crash that sent two kids to hospital

Winnipeg police say a woman has died and five others — including… Continue reading

The ‘relentless underdog’: Green Leader Sonia Furstenau ready for uphill battle

Green Leader Sonia Furstenau was driving Monday when she turned on the… Continue reading

Mi’kmaq power, inside and beyond Ottawa, stronger than in past fishery battles

HALIFAX — When Jaime Battiste was in his early 20s, cable news… Continue reading

Author says acquittal on child pornography charges allows him to ‘breathe again’

‘It’s completely abhorrent to be accused without proof’

Montreal demonstrators demand climate justice a year after Greta Thunberg speech

MONTREAL — Demonstrators gathered in downtown Montreal on Saturday to protest planetary… Continue reading

Most Read