WestJet targets 40 per cent fare cuts with new carrier

WestJet Airlines said it will offer fares that are 40 per cent cheaper than those currently available in Canada as it unveiled new details about Swoop, the ultra-low-cost carrier it plans on launching next summer.

After months of behindthe-scenes planning, WestJet revealed the new name and logo of its no-frills carrier, which will operate as a separate and distinct brand within the WestJet family. Swoop is expected to start selling discounted tickets in early 2018 and will begin flying passengers on six Boeing 737-800s in late June 2018.

Bob Cummings, WestJet’s executive vice-president responsible for the launch of the new ultra-low-cost carrier, said Tuesday that Swoop will boast the lowest cost per available seat mile (CASM), a measure of how much an airline spends to fly passengers, within less than a year of launching.

“What we modelled out from an ultra-low-cost carrier perspective is that when we reach 10 aircraft (in spring 2019) and scale economies, we will have the lowest cost of any Canadian ULCC,” Cummings said.

While the company announced that Swoop’s headquarters will be located in Calgary, the same home base as WestJet, the list of markets the airline will serve has yet to be finalized. Cummings confirmed that Swoop will fly in and out of the Abbotsford Airport, located southeast of Vancouver, and that there are ongoing discussions with major airports in Canada, as well as the Hamilton, Waterloo and Windsor airports in Ontario. The goal, he said, is it launch progressive partnerships with airports that will also “repatriate some of the Canadians going across the border” to access cheaper flights.

“We won’t be coming out of the gate with that high of ancillary revenues, so our fares won’t be quite 50 per cent lower (as seen in the United States) ... We’ll have potentially up to 40 per cent lower fares, depending on the market and time of the year,” he said.

“We’re building a cost structure to get at those type of fares ... The No. 1 thing is to make it as easy to purchase and travel as possible, and right beside that is being transparent in terms of what people are buying ...”

The company says it plans driving ancillary revenue by charging fees for everything from carry-on luggage to in-flight entertainment and extended leg-room seats. Cummings said featuring advertising within the cabin is not off-limits to Swoop.