Airline competition in Canada still needs to improve compared to other countries, but Canada Jetlines Operations (Cboe CA:CJET) is one such airline that gives Canadians a leisurely alternative when flying domestically, to the U.S., or even to Caribbean destinations.
With its headquarters out of Toronto, Ontario, Canada, Jetlines Operations is primarily a leisure airline that connects passengers to sunny, in-demand destinations. However, its services also include charter and ACMI (aircraft, crew, maintenance and insurance) flights to meet the demands of its diverse customer base all year round.
Additionally, setting the company apart from its peers in the space is its distinct new entrant advantage: in other words, Canada Jetlines Operations is an airline bringing high customer centricity at an unbeatable price.
CJET partnership with European carrier
In early March, the company announced a partnership with a European carrier, underscoring the global demand for A320 aircraft.
The first aircraft is slated to begin in late April 2024 for a six-month period followed by a second aircraft in July for a three-month period.
“In January, we announced the expansion of our fleet to 6 aircraft. The utilization of these planes is widely needed in Europe during their busy season. The two planes will return to Canada for our busy fall/winter travel period to leisure destinations,” Eddy Doyle, CEO of Canada Jetlines Operations, said in a statement. “This partnership underscores our commitment to maximizing efficiency and meeting the seasonal demands of our customers.”
Over the summer months, the company’s schedule will include the following destinations:
- Toronto (YYZ) to Halifax (YHZ)
- Halifax (YHZ) to Orlando (MCO)
- Toronto (YYZ) to Orlando (MCO)
- Toronto (YYZ) to Montego Bay (MBJ)
- Toronto (YYZ) to Cancun (CUN)
Demand for leisure air travel
Canada’s airline industry continues its path toward consolidation, which is creating not only a market void but a rise in airfare prices and fewer flight options.
According to the Canadian Press, lower-cost airlines such as Swoop and Lynx Air have been eradicated, while WestJet acquired Sunwing Airlines.
The Competition Bureau released a report in October 2022 outlining concerns of WestJet’s acquisition of Sunwing Airlines, indicating it will result in a “substantial lessening or prevention of competition in the sale of vacation packages to Canadians.”
“Eliminating the rivalry between these integrated airlines and tour operators would likely result in increased prices, less choice and decreases in service for Canadians,” the Competition Bureau said. “It would also likely result in a significant reduction in travel by Canadians on a variety of routes where their existing travel networks overlap.”
As the demand for leisure air travel continues to rise – and with fewer options currently on the market – this puts Canada Jetlines Operations in a prime position to cater to the demand and essentially fill the gap.
Thanks to minimal high fixed costs when compared to legacy carriers burdened by pandemic-related liabilities, Canada Jetlines has a distinct advantage.
Case in point, as Canada’s only boutique airline, the company launched Jetlines Vacations in January of this year, which is a subsidiary company and an all-encompassing vacation experience provider intended to meet the demand for leisure travel to bucket-list destinations.
The addition of Jetlines Vacations brings all-inclusive premium vacation packages that include airfare on Canada Jetlines, ground transportation, top-tier hotel accommodations, and options for leisure activities. Destinations also include Montego Bay, Jamaica, Cancun, Mexico, and Orlando, Florida. Jetlines Vacations currently offers over 15,000 room nights to its growing list.
Putting it simply, Canada Jetlines Operations’ entrance into the leisure airline market presents a significant opportunity for it to carve a niche and fuel growth.
CJET in the news
On March 18, the company announced the delivery of one Airbus A320-200 through a long-term lease from Aviation Capital Group LLC, making it Canada Jetlines’ fourth aircraft. It has signed lease agreements for two additional Airbus A320 aircraft that are scheduled for delivery in Q2 2024.
“We are excited to partner with Aviation Capital Group LLC and welcome this new addition to our fleet. This A320-200 delivery marks a significant step in our growth strategy, allowing us to enhance our service offerings and expand our operations to better serve our customers. Canada Jetlines’ unique business strategy of focusing on charter/ACMI flights, along with a leisure destination-focused scheduled service operation, allows it to be competitive with a sustainable growth strategy,” Doyle said in a statement.
The company also recently closed the third and final tranche of its $13.5 million equity financing. Led by Jetstream Aviation. Canada Jetlines will use the net proceeds for aircraft acquisition, general corporate and working capital purposes.
The investment corner
Despite the challenges in the airline industry, the company’s scheduled flying that is sold to the public is only a fraction of its business activities. With a significant portion of its business consisting of charter flights and flying for other airlines, Canada Jetlines Operations represents a unique play in the space.
As such, under its umbrella are three revenue streams with diversified growth potential, including passenger revenue, chartered/ACMI flights and Jetlines Vacations. Fueling its future growth is its leadership team which has a cumulative experience of over 70 years.
Doyle, for example, was a former pilot with the Canadian Air Force and Air Canada with over 11,000 flying hours to his name. His track record includes overseeing a staff of nearly 4,000 at Air Canada and spearheading Bamboo Airways’ remarkable growth in Vietnam, scaling up to 25 aircraft during his tenure as deputy CEO.
With demand for leisure air travel on the rise, and with few options to choose from in Canada, Canada Jetlines Operations just might be your gateway into the market.
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