Brilliant on so many levels...
It's the most central location for feed from the west coast, central BC, all of Alberta and Saskatchewan. It will generate all kinds of "domestic portions of international journey" traffic that WJ has not had the opportunity to tap that is a significant reason why network airlines typically report higher l/f's, especially during periods of high demand.
It puts Icelandair on notice that the free ride comes to an end, and remember, WJ has Cdn domestic feed out of the yang yang into YEG and can/has developed partnerships in Europe. Icelandair has no feed at the Cdn end of the pipeline. They need O&D traffic and will have to generate it solely on price. That will only succeed if they have the lowest unit costs, which, when operating 757 vs 767 equipment together with their labor costs, is unlikely to be the case.
It will force high cost Air Canada mainline to have to be very competitive on pricing to the UK and beyond from ALL of Western Canada which is not difficult to do, but very difficult to do profitably.
I suppose they could end up Rouging all UK service from western Canada to LHR to stay price competitive at the low end they now seem to be completely obsessed with, but that won't do much for the premium passengers who pay the freight and who underwrite much higher cost mainline route profitability, especially during the summer when the sun is shining.
A lot of hay has to be made in the summer months to underwrite all but about 6 weeks from mid October thru the end of April. A bad harvest in the summer causes all kinds of problems in the winter.
Premium traffic, who obsessively resist any service that has them having to interface with budget travelers at any level will move over to BA, LH. or KLM for their Western Canada to the UK and beyond premium service.
It will be very interesting to watch this all unfold.
Last edited by HangTen; Jun 29, 2015 at 10:59 am