Flair cuts all of the cities added in the late summer and will operate a bare-bones service between only four cities for at least six weeks
Word of the cuts comes the same day Transat reveals a $90.7 million loss just three months and warns there is uncertainty of its ability to continue as a going concern
Canadian ultra low-cost carrier Flair is pulling service from a half-dozen airports in the latest update to its winter schedule. The airline blames the ongoing pandemic for the move.
The airline’s online schedule shows Flair returning to a schedule it flew during the darkest days of the pandemic. It will fly between Toronto and Vancouver four days a week, with stops in either Edmonton or Calgary along the way.
That would indicate Flair is pulling service from Winnipeg, Regina, Saskatoon, Fort McMurray, Prince George, and Kelowna. Airline management told airport authorities the service suspension will start in early January and last until at least the end of February.
“Due to the COVID-19 pandemic, Flair Airlines has reduced the January and February flight schedules,” the airline posted on its website. “Passengers affected have been provided a full refund or rebooked onto another flight where applicable.”
Flair is pulling service from cities to which it expanded service in the summer. The airline took an ambitious gamble in Western Canada, announcing service to places that had never seen a ULCC.
“We definitely saw some, from their perspective, decent loads coming into Regina,” said Regina International President and Chief Executive Officer James Bogusz in an interview. “It’s unfortunate. At the end of the day, having the additional choice in the market was great. And having Flair here in addition to Westjet and Air Canada, it was helping put additional seats in our market, keeping costs very reasonable.”
Softening of demand as fall turns to winter
Bogusz said passenger traffic in Regina has declined since the summer, even when taking account the usual seasonal adjustments. In October, the airport saw 18% of its 2019 passenger load. In November, it was just 15%. December is trending along the same lines, and no one knows what the usual Christmas travel rush will bring.
Normally, Regina would see as many as 25 departures a day at this time of year. Not now. “Depending on the day of the week, I have days where I only have three departures,” said Bogusz. “Some days I have four.”
The pandemic has decimated travel, with passenger numbers down 85% or more from 2019 across Canada.
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Another dark day
Flair’s winter schedule cutback is the latest blow to an industry that has been reeling for the past nine months.
Also on Friday, Air Transat announced a net loss of almost half a billion dollars for its fiscal year ended October 31. Because of the pandemic, revenues were off by $1.6 billion – more than 55% compared to the previous year.
Transat halted all operations in March as countries closed their borders and demand for travel collapsed. Transat resumed limited operations in July, with flights from Montreal, Quebec City, and Toronto.
In August, September, and October, revenues were down a staggering 95.6% from the same period in 2019.
“The impact of the pandemic annihilated a very good start to the fiscal year,” the airline said announcing its results.
“As at October 31, 2020, there exists material uncertainty that may cast significant doubt on the Corporation’s ability to continue as a going concern,” the airline said.
What’s worse, management predicted a dire outcome if Transat’s proposed merger with Air Canada falls through. “Should the transaction with Air Canada not be completed, the Corporation will have to put in place overall financing totalling approximately $500.0 million in 2021 to ensure continuity of operations.”
That money could come from banks or government programmes, the airline said, adding it is currently in negotiations.
Transat shareholders are due to meet next week to decide whether to accept Air Canada’s drastically reduced offer.
Holding out some hope
Industry executives continue to hold hope for the future, despite the dire news.
New Flair CEO Stephen Jones has set an ambitious target of 50 aircraft for his small company.
In Regina, airport chief executive James Bogusz says COVID testing could help get people travelling again. But first, governments have to lift travel restrictions and border closures and encourage people to travel.
“I understand why it’s being messaged the way it is,” he said. “But the problem is that same messaging which is good for the public makes it almost impossible to imagine an uptick in travel demand until there’s some encouragement to travel – even interprovincially – and not a discouragement to travel as we have today.”
Flair has told Bogusz it hopes to return to Regina in March.
Air Transat is holding out hope that vaccines, soon to be deployed, will lift the industry.
“While the likelihood of the availability of a vaccine in the near future makes it possible to hope for the resumption of operations at a certain level during 2021, the Corporation does not expect such level to reach the pre-pandemic level before 2023,” the airline said.
Negotiations will continue to help it get there.