End to Lynx Air doesn't mean cheap airfare is over in Canada, experts say
Experts say the demise of Lynx Air is not necessarily an end to affordable flights for Canadians.
The airline announced Thursday it had filed for creditor protection under the Companies' Creditors Arrangement Act (CCAA). The small Calgary-based airline, with just nine aircraft, launched in November 2021, vowing to “liberate” Canadian travellers with its low airfares.
In recent months, aviation experts have remarked on Canada's unusually competitive airspace, with the emergence of Lynx, Flair, Porter and Canada Jetlines alongside behemoths Westjet and Air Canada.
Even with Lynx off the map, ticket prices could remain affordable, said Robert Kokonis, a Toronto-based aviation consultant.
“If we were to lose another carrier, that might give you pause for thought — but in the near term, I think we're going to be fine,” Kokonis said.
Kokonis said the confluence of Porter's rapid expansion into several areas of Canada, Westjet's orders for dozens of Boeing Max 10s and its ultralow-cost offerings on some of its traditional commercial jets mean there's still ample offerings to keep prices down.
However, Kokonis said demand for air travel could hit a speed bump in 2024. In Air Canada's 2023 fourth-quarter report, operating revenue per available seat mile was up only 1.2 per cent, which may signal consumer spending is beginning to weaken.
“I think that from a pricing perspective, we're still going to be OK in this country,” he said.
But factors such as wage inflation, high interest rates, a weak Canadian dollar and increases to industrial carbon pricing could inflate ticket prices this summer, said Barry Prentice, transportation expert and professor at the University of Manitoba.
“The reality is that consumers will observe little difference. (Lynx was) only flying in very competitive routes and their capacity can be absorbed easily at this time of year,” Prentice wrote in an email to Postmedia.
“If anyone has a wedding or hard date of travel in the summer, I would recommend booking now. Not because of Lynx, just because of the general state of the industry.”
Rick Erickson, a Calgary-based aviation consultant, said any price increases likely wouldn't be a direct result of Lynx's departure.
“We're talking nine airplanes … 4,500 seats per day — 4,500 seats is what Air Canada puts out of Vancouver, Montreal or Toronto every hour,” he said.
Jessica Cardin, a 35-year-old Calgarian, is scrambling to rearrange her July wedding after Lynx's closure. About 20 of her family members from Ontario had booked Lynx flights — now cancelled — to Calgary for around $300. When she looked at tickets on Thursday night, the cheapest trip she could find was $900.
Lynx says on its website that it's not available to assist with refunds, and customers need to contact their credit card company to get their money back. Cardin said she was told that will take up to 120 days.
“It sucks. It's supposed to be the happiest time of our lives, and now we're just stressed out because now the people that we love can't be there,” she said.
Lou Arab, media relations officer for CUPE, which represents 240 Lynx flight attendants, said employees haven't yet been offered a severance package. The airline informed all employees of its decision in a Thursday afternoon town hall.
“We're going to be fighting for them and making sure that whatever they're legally entitled to is paid, but there was certainly no mention of severance at the meeting,” Arab said.
There are limits to what employees can be offered when a company enters creditor protection, said Tim Perry, president of Airline Pilots Association Canada.
“Companies don't have a lot of latitude to make offerings at this point in time because of the legal framework around CCAA,” Perry said.
The coming weeks will be stressful for pilots, flight attendants and other soon-to-be-former Lynx employees, he added.
There is a strong job market for pilots, Perry said, as many airlines are currently hiring. But it means many pilots who built seniority at Lynx will be starting fresh at new airlines. “It doesn't really matter — losing your job is extremely, extremely difficult and challenging,” Perry said.