V1213

https://www.bnnbloomberg.ca/westjet-...wing-1.1731321

V1213

https://www.westjet.com/en-ca/news/2...nwing-airlines
Didn't take long to be officially announced.

FlyerJ

Dear WestJet,

Do not Rouge me.

Been there, done that. And I switched airlines as a result.

If I want to take advantage of my WJ dollars and my WJ status to go on vacations with my family, do not expect me to fly “charter” (or on a charter-style carrier).

I want the stuff that comes with a real, mainline carrier. I value it. And I’m tall, so I will never step foot aboard any of the teeny-tiny pitch aircraft of Rouge, Sunwing, Transat, Frontier, Spirit, etc.

If I want to go to Vegas or Cancun or Maui, don’t make me take Sunwing instead of a full service, mainline carrier. If I don’t have a WestJet option for my leisure destinations, my business travel will also walk.

(When AC “Rouged” YYC to LAX, PHX and LAS a few years ago, I left AC and UA and all of Star Alliance after my first on-board experience.)

If Sunwing makes sense for WJ from a business perspective, I’m thrilled. But I’m not a Sunwing customer, and don’t intend to become one just because of this acquisition.

Error 601

I don't think Sunwing is any bigger a danger than Swoop is when it comes to routes potentially being "Rouged".

I suspect WestJet bought Sunwing so somebody else couldn't turn-key Sunwing into yet another ultra-low cost startup.

FlyerJ

Fair enough. I think (hope) you’re probably right.

I’ve been through Zip, Tango and Rouge … all with AC … all low cost, low service, less-than-mainline-but-at-full-price. I’ve been through TED by United. All were attempts to put supposed low yield routes on a low cost second carrier.

Anytime (almost!) that there’s an “airline within an airline”, it’s a big step down for customers, and there’s often a desire from airline management to cut costs by swapping mainline out for the cruddy planes and service on routes where they can get away with it.

The only exception, fortunately, was Swoop.

My fear with Sunwing is what happens with true leisure destinations: Vegas, Cancun, etc.

Today, WestJet fills up planes to those destinations with a mix of ‘airline’ and ‘vacation package’ customers — who have bought through those two separate channels. Two sales channels (WestJet and WJV) all putting customers on the same flights.

But Westjet Vacations will now effectively become Sunwing. So what metal, what level of service will be offered to places like CUN and LAS? Will WestJet send a WestJet plane, and WestJet Vacations (aka Sunwing) simultaneously send a Sunwing plane?

V1213

The press release implies that there will be at least some fleet sharing:
I hope that this means Sunwing aircraft will be upgraded to WestJet standards so there's one fleet that is interchangeable, rather than Sunwing operating semi-independently with a different onboard product. The press release says that they will keep the "...Sunwing brand alongside WestJet Vacations." It's not clear if this brand retention will apply to the aircraft, or just the sale of holiday packages.

FlyerJ

I struggle to understand what WestJet’s market position is now. Who are they, and who do they want as customers?

They’ve been desperately trying to up their game for years to become a top tier airline with full service, partnerships, Premium class, etc, appealing to business and leisure travellers. That’s been kinda rocky, though, and they’re still not there. They have a long way to go.

Meanwhile, they start up their own LCC.

Then, they buy a “package vacation” tourist airline.

But they’re still a relatively small player in the industry … so I can’t fathom how, with their size, they can successfully be all things to all people.

So do they want to be like Delta or Air Canada or United? Or are they a tourist carrier? Are they one of these … and just dabbling in the other??

Again, with their size - even their new, post acquisition size - they’re still small by their industry’s standards. I don’t see how they can cover every segment of the market … at least not well.

Maybe they’re trying to be a mini-IAG that has a bunch of distinct subsidiaries covering different market segments?? But a bunch of small players banded together under common ownership get no financial benefit from scale.

tracon

This was the sentence I found interesting.
WestJet’s acquisition will increase capacity, “dedicating otherwise seasonal aircraft to operate year-round in Canada,”

For those who don't know, in the summer WG sends a bunch of planes to Europe and in the winter leases in a bunch of European planes for their respective peak flying. Canadian and European flight crews travel with their planes.


As for corporate semantics, how much difference is there with WS buying WG vs. Onex buying WG?

tcook052

Let's see how this shakes out before breaking any limbs jumping to conclusions as it could be a while before WS decides how it feels best to align WG & Sunwing Vac. into WS & WS Vac.'s world.

As has been pointed out this may be little more than WS gobbling up a pre-pandemic leisure competitor at pennies-on-the-dollar pandemic pricing to control more of a lucrative market when and if the market segment rebounds. And while I'm just a novice, I expect the sunspot segment to rebound faster than long-haul routes.

Could be that WS will integrate WG into Swoop rather than reconfigure the aircraft to bring them more into WS mainline standards.

The same fleet types of 800 and Max8's between WG & WS also offer some advantages of conformity and makes sense more than if WG fleet was Airbus only.

Lastly, WG managed to gain a foothold into the Quebec market so perhaps WS appreciated that and decided to buy rather than build more of a presence in that market which let's face it, WS has failed to do after several concerted efforts.

aerobod

I think they are just playing airline iata code bingo to pass the time, the question is what will be the 5th code?
WG
WO
WR
WS
W?

Maybe with the branch out into cargo, too, if they buy Cargojet they could complete the set with W8 - the five and only Canadian operators with a code beginning with “W”…………

robsaw

Onex is an investment company, with Westjet, a separate operating company, as one of their investments. From a structural perspective, if they want to integrate and operate WS and WG with any regulatory and staffing efficiency they need to be part of that same operating structure, with Westjet as the parent, not Onex.

tracon

https://canadianaviationnews.wordpre...-risk-to-deal/

Steel magnate Alexei Mordashov, known as Russia’s richest man, with a fortune worth US$29-billion, has been sanctioned in Europe for his ties to the Kremlin and businesses that support the war against Ukraine. He’s also in line to be an indirect shareholder in Onex Corp.’s WestJet Group, should the Toronto investment company’s proposed takeover of Sunwing Travel Group go ahead.

yyztodtw

Maybe we see Sunwing's fleet integrated/upgraded to Westjet standard, and the Sunwing brand sticks around just to sell packages, like a travel agency?

Alternatively.... what if they take the Sunwing planes and send them to Swoop to operate the leisure flights? Gives Onex a boost of visibility on a brand most people don't even know about yet.

Adam Smith

It's odd to me that this has caused a fuss. Sunwing's owners will get what, 10% of WestJet's equity in this deal? Mordashov owns 33% of TUI, which owns 49% of WG. That would give him an indirect interest in 1.6% of WS's stock. It's totally inconsequential.

robsaw

In addition, Mordashov’s shares in TUI have been frozen and he's resigned from Tui’s board.