TORONTO — It took years and years to get off the ground – and just shy of 24 months to come to a skidding halt.
A spokesperson for Canada Jetlines said yesterday that the company “pursued all available financing alternatives including strategic transactions and equity and debt financings. Unfortunately despite these efforts, the company has been unable to obtain the financing required to continue operations at this time.”
The airline has grounded its planes and ceased operations. Passengers with existing bookings are asked to contact their credit card company to secure refunds. The company says the suspension of operations is temporary, with plans to file for credit protection.
FAMILIAR SCENE
It’s a familiar scene for Canadian travel advisors who have seen more than a few airlines come and go over the years.
Unlike many other start-up carriers, though, Canada Jetlines was a fan of agents from the get-go. The airline secured retail distribution and GDS partnerships, offered commission and worked hard to get the trade onside with fams and contests.
Canada Jetlines’ strategy was in stark contrast to that of another new player, Lynx Air. Lynx went the low-cost route and didn’t court travel agents. In the end neither airline sustained altitude, with Lynx Air calling it quits in February 2024.
In December 2023 Porter Airlines CEO Michael Deluce said the travel market was too small to keep all of Canada’s airlines afloat for two more years. In less than a year he’s been proved right two times over.
“PLAYFULLY PROVOCATIVE” AD CAMPAIGN
When Canada Jetlines first took off in September 2022, soaring demand for travel coming out of the pandemic gave the new carrier’s launch strong momentum.
The goal in spring 2022 was 15 aircraft by summer 2025.
The post-pandemic surge put the spotlight on new players like Canada Jetlines and Lynx. That also meant that Jetlines often got lumped in with Lynx, as yet another low-cost carrier. Canada Jetlines wasn’t an LCC, but without strong messaging to the contrary, travellers may not have known what to make of the new brand. Consumer ads also seemed to be few and far between.
Meanwhile Canada Jetlines’ long runway to launch made its take-off something of a miracle. Back in September 2019, when the start-up was still being positioned as an ultra low-cost carrier, there were calls for more financing, and then announcements about delayed launch dates. In October 2019 there were layoffs and a CEO departure.
The airline’s backstory goes back even further, years and years.
In 2015, Duncan Bureau, then VP, Global Sales for Air Canada, was asked about the chances of success for newcomers and startups like Jetlines. “It’s a capital-intensive marketplace and Canada is well-served already,” he said at the time. “I think it would be a tough go. I don’t think Canada has room for another airline but time will tell.”
Bureau ended up joining Canada Jetlines in 2021 as Chief Commercial Officer – and then left in 2023. Bureau always championed travel advisors, saying “we are very focused on our relationship with the travel trade,” back in March 2022 as the carrier readied for its first flights.
On top of the delays and executive resignations, the lead up to launch also included a lawsuit, and even a “playfully provocative” ad campaign.
But all looked well on Sept. 22, 2022 when Canada Jetlines finally took off from Toronto Pearson for Calgary. More routes followed, including Toronto-Vancouver.
In addition to its domestic routes, Canada Jetlines launched Toronto-Las Vegas, Toronto-Cancun and more. The carrier also saw success with charter flights. By summer 2023 it had its third aircraft.
GOOD TIMES DIDN’T LAST
The good times didn’t last. In February 2023 came reports of a delayed launch for new Toronto flights to Melbourne, FL. At the same time Canada Jetlines announced it had entered into a non-convertible term loan agreement for a $1.5 million loan from Roosheila Group Inc. And in April 2023 the airline announced it was pausing its domestic routes to refocus on sun destinations and leasing its planes.
The carrier’s 2023-24 winter sun schedule included flights from Toronto to Cancun, Montego Bay, Las Vegas and Orlando.
From then on updates were fewer and farther between. Bureau’s departure in summer 2023 made headlines, and just short of a year later, in May 2024 chief executive Eddy Doyle announced his departure from the company effective June 30.
STATEMENTS FROM CANADA JETLINES
Earlier this week the airline announced the resignation of four board members, including the CEO. Brigitte Goersch, Ryan Goepel, Beth Horowitz and Shawn Klerer all stepped down from the airline’s board of directors. Goersch also resigned as CEO. Goepel, who is President and CEO at Global Crossing Airlines, was chairman of the Canada Jetlines board.
In its Aug. 12 statement Canada Jetlines said: “The continuing operations of the company have been dependent upon the company’s ability to raise adequate financing and to grow the airline to the point where it can commence profitable operations. The company has historically financed its future requirements through a combination of debt, equity or other facilities. As a result, the company will need to raise additional capital to continue operations. The company’s board of directors and management is actively working on potential sources of additional capital.
The Aug. 12 statement ended on this note: “At this time the airline is continuing operations.”
Airline news site GateChecked, which earlier this week reported that Canada Jetlines crew and staff received a memo from management about the carrier’s imminent closure following the resignations, also said that Canada Jetlines “unofficially discontinued scheduled service in late June”, solely focusing on charters.
Three days later, on Aug. 15 Canada Jetlines said: “Canada Jetlines Operations Ltd. announced today that it will be temporarily ceasing airline operations effective August 15, 2024. The company, overseen by an independent Board committee and advised by external advisors, pursued all available financing alternatives including strategic transactions, and equity and debt financings.
“Unfortunately despite these efforts, the company has been unable to obtain the financing required to continue operations at this time. Every effort is being made to assist passengers at this time. Passengers with existing bookings are advised to contact their credit card company to secure refunds for pre-booked travel. The company intends to file for creditor protection. Additional details will follow regarding such filing.”
TIPS FROM TICO
Travelweek reached out to TICO for comment. “TICO is in the process of obtaining additional information related to Canada Jetlines and their reported plans to enter creditor protection,” said a statement.
“As soon as we have additional information, it will be shared on TICO’s website, including potential eligibility for claims under the Ontario Travel Industry Compensation Fund.”
TICO also include general guidelines about potential eligibility for the Comp Fund …
Air-only bookings
Consumers who purchased airfare only through a TICO registered travel agency or website, and who did not receive the travel services purchased or a refund, may have an eligible claim against the Compensation Fund. More information will be provided as it’s available.
Consumers who purchased airfare only directly from Canada Jetlines or through a travel agency/booking website outside of Ontario are NOT eligible for reimbursement through the Compensation Fund.
Vacation package bookings
Consumers and travel advisors who booked Canada Jetlines Vacations packages (air and accommodation) can call 647-236-3917 for refund information. This phone number is unable to support air-only passengers.
Consumers who purchased a vacation package directly from Canada Jetlines Vacations or through a TICO registered travel agency or website, and who did not receive the travel services purchased or a refund, may have an eligible claim against the Compensation Fund. More information will be provided as it’s available.
Consumers who purchased a vacation package through a travel agency/booking website outside of Ontario are NOT eligible for reimbursement through the Compensation Fund.
