NewLeaf drops US destinations, blames WestJet
Jan 3, 2017, 3:57 pm
#1
Original Poster
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NewLeaf drops US destinations, blames WestJet
Just announced on NewLeaf's Facebook page. (My apologies ... I can't seem to link to the FB URL here!)
NewLeaf, was on the path of offering low fares to exciting destinations like Phoenix-Mesa, and Melbourne-Orlando this year. When an airline in Canada found out that NewLeaf was servicing Phoenix-Mesa they too decided to follow our schedule. Within hours, of NewLeaf’s announcement this airline had also lowered its fares and offered service to an airport it had previously ignored for over a decade.
We are very sorry Alberta, but we cannot offer service to Phoenix-Mesa this year. This is a classic case of the big guy squishing the little guy so that the big guy can profit more…We sincerely hope and in fact challenge the other airlines to keep the fares low for you so that you can still travel south for the winter.
NewLeaf is also very sorry that this will affect our Florida route from Hamilton as well. NewLeaf will be postponing service to the sun for both Arizona and Florida.
We are very sorry Alberta, but we cannot offer service to Phoenix-Mesa this year. This is a classic case of the big guy squishing the little guy so that the big guy can profit more…We sincerely hope and in fact challenge the other airlines to keep the fares low for you so that you can still travel south for the winter.
NewLeaf is also very sorry that this will affect our Florida route from Hamilton as well. NewLeaf will be postponing service to the sun for both Arizona and Florida.
Jan 3, 2017, 7:30 pm
#5
Join Date: Jul 2014
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"NewLeaf, was on the path of offering low fares to exciting destinations like Phoenix-Mesa, and Melbourne-Orlando this year. When an airline in Canada found out that NewLeaf was servicing Phoenix-Mesa they too decided to follow our schedule. Within hours, of NewLeaf’s announcement this airline had also lowered its fares and offered service to an airport it had previously ignored for over a decade.
We are very sorry Alberta, but we cannot offer service to Phoenix-Mesa this year. This is a classic case of the big guy squishing the little guy so that the big guy can profit more…We sincerely hope and in fact challenge the other airlines to keep the fares low for you so that you can still travel south for the winter.
NewLeaf is also very sorry that this will affect our Florida route from Hamilton as well. NewLeaf will be postponing service to the sun for both Arizona and Florida."
...which, roughly translated means "we just found out what a competitive market looks like and we don't like it!"
We are very sorry Alberta, but we cannot offer service to Phoenix-Mesa this year. This is a classic case of the big guy squishing the little guy so that the big guy can profit more…We sincerely hope and in fact challenge the other airlines to keep the fares low for you so that you can still travel south for the winter.
NewLeaf is also very sorry that this will affect our Florida route from Hamilton as well. NewLeaf will be postponing service to the sun for both Arizona and Florida."
...which, roughly translated means "we just found out what a competitive market looks like and we don't like it!"
Jan 3, 2017, 8:01 pm
#6
Join Date: Jan 2009
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Exactly. If they don't have something to offer consumers over their competitors, then they shouldn't be in the business. The model of this one doesn't seem to add up at all and I'm surprised they're still trying.
Jan 3, 2017, 8:10 pm
#7
Join Date: Jun 2008
Location: YYC, Canada
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If I recall WS complained tons about AC's practice when they were starting out.
The issue is, of course, that WS can run YYC-AZA at a loss just to starve out NewLeaf. Why would you take a chance on an upstart carrier when WS will serve just as well?
The airline industry in Canada is cut throat. The only way new players get in is to have deep pocket investors (i.e. international capital) or new rules from the federal government saying airlines can't do what WS just did.
I scored some very inexpensive tickets to PHX due to all of the competition from WS/Newleaf/AC on this route. I don't think I will ever see that fare again!
The issue is, of course, that WS can run YYC-AZA at a loss just to starve out NewLeaf. Why would you take a chance on an upstart carrier when WS will serve just as well?
The airline industry in Canada is cut throat. The only way new players get in is to have deep pocket investors (i.e. international capital) or new rules from the federal government saying airlines can't do what WS just did.
I scored some very inexpensive tickets to PHX due to all of the competition from WS/Newleaf/AC on this route. I don't think I will ever see that fare again!
Jan 3, 2017, 9:25 pm
#8
Join Date: Dec 2008
Posts: 797
New Leaf had a monopoly on Hamilton - Sanford and cancelled that too.
WJ isn't to blame here. New Leaf's hopelessly naive businessplan is to blame.
Hint: WJ didn't start schedule transborder till they had 40+ tails.
How long will New Laugh continue to push water uphill with their uproariously stupid business model?
WJ isn't to blame here. New Leaf's hopelessly naive businessplan is to blame.
Hint: WJ didn't start schedule transborder till they had 40+ tails.
How long will New Laugh continue to push water uphill with their uproariously stupid business model?
Jan 5, 2017, 5:08 am
#10
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Jan 5, 2017, 8:53 am
#11
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This sector is littered with the carcasses of "dead" airlines without access to a lot of capital. In the end, investors know what a money-losing proposition this can be. Air TransAt has balanced limited seasonal scheduled operations with charter/packaged vacation ops to ensure viability. With the limited market size Canada represents (how many Americans are going to fly such a carrier in the other direction?), it's folly to think we can sustain a multitude of competing carriers?
Wasn't all that long ago that WS was the upstart nipping at the heels of both AC and CP, and ultimately forcing the latter into the arms of the former (though not before an audacious attempt of the latter to take over the former with the help of AA and Onex).
Wasn't all that long ago that WS was the upstart nipping at the heels of both AC and CP, and ultimately forcing the latter into the arms of the former (though not before an audacious attempt of the latter to take over the former with the help of AA and Onex).
Jan 5, 2017, 4:01 pm
#12
Join Date: Jan 2007
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How well does Mesa work for Albertans?
Most of the Canadians I know who head to Phoenix are going to the Scottsdale or Camelback area or points west of PHX. I also know a few Indian guys who head to the Reserve for rodeo related events.
Most of the Canadians I know who head to Phoenix are going to the Scottsdale or Camelback area or points west of PHX. I also know a few Indian guys who head to the Reserve for rodeo related events.
Jan 5, 2017, 4:33 pm
#13
Join Date: Aug 2008
Location: YXY
Posts: 3,506
The question is if WestJet is dumping fares, cross-subsidizing particular routes using profits from other, non-competitive routes, in order to kill a competitor who can not play that game.
If that is allowed, we will never have competition in the Canadian air transportation market. WestJet was on the spot when they complained about such behaviour by a larger Canadian airline back when.
However, if WestJet is selling at cost or above, I'm all for competition.
Of course, the devil lies in the details, like: How to calculate "cost". I know of a library on that topic.
If that is allowed, we will never have competition in the Canadian air transportation market. WestJet was on the spot when they complained about such behaviour by a larger Canadian airline back when.
However, if WestJet is selling at cost or above, I'm all for competition.
Of course, the devil lies in the details, like: How to calculate "cost". I know of a library on that topic.
Last edited by sokolov; Jan 6, 2017 at 3:01 pm
Jan 6, 2017, 3:05 pm
#15
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