DALLAS – WestJet (WS) has confirmed its acquisition of Sunwing Airlines (WG) and Sunwing Vacations, aiming to increase capacity and lower fares.
Additionally, the WestJet Group will be creating a new tour operating business that will encompass both Sunwing Vacations and WestJet Vacations, to be led by Sunwing’s Chief Executive Officer.
WestJet operates 96 Boeing 737 aircraft and six Boeing 787 aircraft, while WG operates a fleet of 28 Boeing 737 aircraft, making the airlines’ fleets highly compatible. The compatibility of the fleets will lead to easier integration of flight crews, ground staff, and operations, helping reduce the overall cost of the merger.
WestJet will also supplement growth by dedicating otherwise seasonal aircraft leased by WG to year-round service. The two airlines are also complementary in their route networks, with each having hubs in Vancouver and Toronto.
The acquisition, which is still subject to regulatory approval, is expected to close late this year.
Alexis von Hoensbroech, Chief Executive Officer of WestJet said, “This combination brings together Canada’s two original low-cost carriers and positions us to accelerate growth in value-oriented travel, already the fastest-growing segment of the airline market.
He continued, “It creates new opportunities for our people, our operational partners, and supports the recovery from a global pandemic that has been particularly challenging for the Canadian travel and tourism industry including local airports and businesses we work closely with.”
Stephen Hunter, Chief Executive Officer of Sunwing said, “The combination of their strong balance sheet and growth trajectory with Sunwing’s unparalleled expertise in creating differentiated vacation packages will ensure the success of the new vacation division.”
The Canadian Low-Cost Carrier Market
The news is the latest development in the rapidly evolving Canadian ultra-low-cost carrier market, which has become increasingly competitive.
The acquisition will allow WestJet to bolster and accelerate growth, allowing the carrier to better compete with rapidly growing low-cost carriers like Flair Airlines (F8) and Air Canada Rouge (RV), which also operate to warmer destinations.
In the coming months, we will also see the emergence of two new ultra-low-cost carriers Lynx Air (Y9) and JetLines.
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