Uncomfirmed: WestJet Three-Tier Fare Structure

This is what a market analyst expects about WestJet's upcoming tier structure.

Tier 1: 20% higher than base fare. Y+ seats, free bags, free food and drinks, priority boarding, no change fees.

Tier 2: Slightly more than existing fare, one free bag, other a-la-carte options.

Tier 3: Lower than existing fares, barebones.

http://business.financialpost.com/20...-year-sources/

If 20% markup over base fare is the price for Y+, then I think they have a shot at making this work. Anything over an hour, I would be willing to pay that much for extra leg room. The rest of the extras don't interest me.

As a culture shift, though, it is a radical change and it will be interesting to see what the response is.

2013 is a significant and defining year for WestJet. We're adding fare bundling, premium economy, launching a regional airline (Encore), and much much more. Even still,Ii strongly disagree with the notion that it's a culture shift or that this will change the culture of WestJet.

It's already happened.......

How so?

What is fare bundling?

These changes are probably not a culture shift for the employees (though I'm not sure how Encore will shift things within the company). But such a change in fare structure would be a culture shift from the point of view of WestJet passengers. For example, free bags are a big selling point for WestJet (and allow the airline to charge a certain premium on the ticket). Fair cancellation fees are good to get me booking in the first place - if they go up, I'd hesitate with certain leisure bookings and probably end up never taking the trip.

At the same time I would understand why the airline is going that route. Most airlines have done it, and for a reason. Furthermore, this structure provides an opportunity to add (perceived) value to the WestJet credit cards. Free bag with the barebone booking, for example.

I think you're confusing the term culture with the word strategy. Our employees have a similar set of values and beliefs that will not change with the introduction of a tiered fare structure or premium economy ("Plus"). I don't work on the frontline but what I do in my role has an impact on the guest experience. Giving our guests the option to get the lowest available fare; pay for the flexibility to take an earlier or later flight for free; board first; or get seats with more legroom has no impact on what I do or why I do it. Our strategy is changing. Not our culture.

Looks like it is confirmed, with new details...

New res system in Jan

Premium econ starts in March with fares well below half of AC business class

http://ca.reuters.com/article/busine...8B21EC20121203

Seems like Westjet keeps moving more and more towards an AC-like structure and leaving behind their LCC model. Three tiers of Y fares....reminds me of Tango, Tango Plus and Latitude I wonder if this is to correspond with AC's structure to make it easier for business Pax. to pay higher fares? (ie. If I usually buy a latitude fare on AC, I'd buy a tier 1 ticket on westjet instead of the cheapest fare that I'd take today).

I wonder if westjet will change their FF program to help woo people from Aeroplan? I know for me, that's probably the main reason I fly AC. If westjet gave me lounge access, priority security/boarding and some upgrades, even to Y+, I'd consider them, instead of defaulting to AC.

I think AC should be worried. I know many people who have been loyal AC E or SE for 10 yrs + and are starting to switch over to westjet. Insane AC fares, dissappearing upgrades and constant delays/cancellations really are making westjet just that much more appealing!

As I said: This is not going to impact the culture from the employees point of view. But for the passengers, it is a culture change.

It is, of course, also a strategic change from a management point of view, that is correct. But most passenger don't think about that, do they.

Half the price of AC Business better deliver some real benefits. Y+ does not equal J or even half of J. WS will not have hot meals unless they install ovens and I doubt that is coming. They don't own lounges so that seems doubtful.

Also, WHEN IS THE IPHONE APP coming. Saretsky promised me it was coming in 2012. Time is ticking down!

I agree. A $20 or $50 premium is reasonable for Y+. Half the price of business class is not, unless something significant is also thrown in. And to sell it, they will have to throw in something significant that is not offered now, not take away everything for the cheap fares and then say, "Oh, but you can have it all back if you pay twice as much." Perhaps some people would pay double for more legroom, free changes, and a sandwich, but I wouldn't.

WestJet's culture used to go well beyond having service-oriented employees who were empowered to make decisions. It used to include high value fares. The "About us" section of their website still starts with: "WestJet was founded in 1996 by Clive Beddoe and a team of like-minded partners, who believed that just because you pay less for your flight, doesn't mean you should get less." That part seems to be disappearing.

Note how it says *well below* half. Not half

On a typical business route, like YYC-YYZ, the cheapest AC business class fare is 7.5 times the cheapest economy class fare. So, yes, WestJet's Y+ fare would have to be well below one-half to be worthwhile. Like one-sixth.

Hypnotize, are passes in the works? Something where I'd buy, say, 10 coupons for one-way trips between my home area and the East Coast or the West Coast?

I wanted to strike a deal and plan my business travel budget for 2013, but there was nothing WestJet could offer. There are group tickets (ten people travelling at once), but no passes (one person travelling ten times).