Quote:
Originally Posted by esquire
With the way they've bungled their international debut, you have to wonder whether they have the nerve/financial wherewithal to keep going with those. They're certainly not at the stage where they should be rearranging their domestic route network around them.
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I feel that Gregg Saretsky's tenure at Westjet as CEO has been hit-and-miss at best. He has expended tons of energy and goodwill in a dubious expansion to London.
When Westjet focused on the Canadian and North American travel market, they had pretty much only one competitor - Air Canada. Air Canada was beset with its own problems in the 2000s, most of which of were due to the self-inflicted wound of buying bankrupt Canadian Airlines. Air Canada was a disliked, uncompetitive, bankruptcy-riddled mess of a company in the 2000s. Competing against that was shooting fish in a barrel.
Now, as it expands to intercontinental travel, Westjet is learning that it's not the easy pickings it had during its domestic/North America phase. No longer is Westjet just competing with Air Canada, they are now competing with British Airways, Icelandair and Air Transat, among others who have learned the hard lessons about that sort of operation. The number of low-cost carriers that have succeeded in the intercontinental market is pretty slim (so far). There is also the question of how 'slack' in the market there is for that travel - intercontinental travel is much more expensive (not just for the flights) than within North America. Either they'll double down or cut their losses.
The best part of his tenure has been the Encore operation IMO. Westjet has seen the success of Porter Airlines model and has effectively minimized any chance that someone else might set up a similar operation out west. Also, it allows them to offer feed in flights to their operation from markets that were neglected or subject to Air Canada's previous monopoly. It cuts costs by allowing them to downsize their operations to marginal cities (running Q400s full is better than 737s half full) without completely destroying frequency.
So, I think Westjet should focus on domestic/North American operations and let the European experiment expire. Southwest hasn't expanded beyond the North America and I think they're happy to stay that way. Air Canada has improved domestically largely because of Westjet's competition and if Westjet becomes too preoccupied with European expansion, both airlines might enter that fat-and-happy stage of contentedness that results in Canadians getting the shaft from two uncompetitive airlines domestically.
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