The next airline hoping to pose a threat to the country’s Air Canada-WestJet duopoly has landed its inaugural flight.
Canada Jetlines’ first flight departed out of Toronto Pearson International Airport Thursday morning and arrived in Calgary International Airport to speeches and a ribbon cutting ceremony.
The new startup airline, headquartered in Mississauga, Ont., is offering service between Toronto’s Pearson International Airport and Calgary International Airport twice weekly.
Canada Jetlines bills itself as an “all-Canadian, value-focused leisure carrier.” While Toronto-Calgary is its only scheduled route right now, the company’s chief commercial offer, Duncan Bureau, said the airline plans to service the leisure market both domestically and trans border with flights to the Caribbean and the Americas.
The airline currently has one Airbus A320 and a second to join in December, with plans to expand the fleet to 15 Airbus A320s by 2025 at a rate of five aircrafts per year, said Bureau.
Canada Jetlines is the country’s newest, but not first, airline to emerge in the wake of the pandemic.
Edmonton-based Flair Airlines has been aggressively expanding in the last year and a half, and now serves 36 airports with 85 routes and a fleet of 18 aircraft.
Calgary-based Lynx, formerly known as Enerjet, launched last spring and said at the time it hoped to operate nearly 90 flights a week on nine routes by June, all within Canada.
WestJet also operates its own subsidiary low-fare airline, Swoop, which launched in 2018 and offers service to destinations in Canada, the U.S., Mexico and the Caribbean.
While these competitors operate under a low-cost, no-frills model, Canada Jetlines aims to differentiate itself with service to the premium leisure market, said Bureau.
He added he is critical of the business model being used by so-called low-cost carriers like Flair and Lynx.
“If you’re charging fares at rates that are lower than the cost of parking your car at the airport, the economics just don’t work and it’s not sustainable,” Bureau said.
Canada Jetlines plans to offer a premium experience to customers that include departure times that fit the preference of the consumer over the pilot and 174 seats in lieu of the standard 180 to provide increased comfort, said Bureau.
On its website, Canada Jetlines is advertising introductory fares starting at $99 for one-way trips between Calgary and Toronto for a limited time.
To compare, Flair offers one-way trips from Calgary to Toronto for $49, the same route starts at $99 on Lynx and you can fly from Edmonton to Toronto for $59 with Swoop, according to the companies websites.
The pandemic’s ravaging of the mainstream airline industry is making it possible for startup airlines to obtain parked and inactive planes at a good price, said Rick Erickson, an independent aviation analyst based in Calgary.
Such is the case for Canada Jetlines, as the pandemic paved the way for the airline to hire available talent and acquire aircraft at a low cost.
“I think the ones who survive are going to be the ones who have the deepest pockets. It generally takes anywhere from 18 to 24 months for new airlines to start turning a profit, so with all of these new players coming onto the market, the question is ‘who has the deepest pockets and who has the best business plan?'” said Erikson.
Bureau said Canada Jetlines plans to offer service in the U.S. within the next three months although any official offerings and dates have yet to be announced.
Canada Jetlines is an independent airline that is publicly traded on the NEO Exchange.
This report by The Canadian Press was first published Sept. 22, 2022.
Amanda Stephenson and Caitlin Yardley, The Canadian Press
Prairie premiers, governors urge Canada, U.S. to keep border crossings open longer
Washington – Canada’s Prairie premiers and two U.S. governors want their respective countries to restore pre-pandemic operating hours at entry points along their shared land border.
The group of provincial and state leaders have written to Prime Minister Justin Trudeau and President Joe Biden to argue that curtailed hours at border crossings are hurting the economy.
The letter is signed by Alberta Premier Jason Kenney, Saskatchewan Premier Scott Moe and Manitoba Premier Heather Stefanson, as well as Montana Gov. Greg Gianforte and North Dakota Gov. Doug Burgum.
It says travellers and businesses are being forced to go out of their way to find entry points with longer hours, driving up fuel and labour costs.
The leaders say that’s also hurting smaller border communities along the Canada-U.S. border that depend on international traffic for their economic livelihoods.
The letter does not mention that the U.S. still requires visiting foreign nationals to be vaccinated against COVID-19, a requirement Canada lifted over the weekend.
“Residents and businesses on both sides of the border have expressed concern that the reduced hours of operation will become permanent,” the letter reads.
It also argues that the supply chain problems that have persisted since the onset of COVID-19 in 2020 will only linger so long as cross-border trade and travel remains curtailed by limited hours at border crossings.
“Resuming pre-pandemic operating hours will ensure the efficient and steady flow of people and goods, which will only improve trade activity and reduce inflationary pressure on both sides of the border.”
A notice on the Canada Border Services Agency website warns of limited operating hours at nearly 40 land ports of entry, mostly in the Prairie provinces, along with Quebec, New Brunswick and B.C.
This report by The Canadian Press was first published Oct. 3, 2022.
What if Musk loses the Twitter case but defies the court?
Twitter wants a Delaware court to order Elon Musk to buy the social media service for $44 billion, as he promised back in April. But what if a judge makes that ruling and Musk balks?
The Tesla billionaire’s reputation for dismissing government pronouncements has some worried that he might flout an unfavorable ruling of the Delaware Court of Chancery, known for its handling of high-profile business disputes.
Musk hopes to win the case that’s headed for an October trial. He’s scheduled to be deposed by Twitter attorneys starting Thursday.
But the consequences of him losing badly — either by an order of “specific performance” that forces him to complete the deal, or by walking away from Twitter but still coughing up a billion dollars or more for breach of contract — has raised concerns about how the Delaware court would enforce its final ruling.
“The problem with specific performance, especially with Elon Musk, is that it’s unclear whether the order of the court would be obeyed,” retired Delaware Supreme Court Justice Carolyn Berger told CNBC in July. “And the courts in Delaware — courts all over — are very concerned about issuing a decision or issuing an order that then is ignored, flouted.”
Berger, who was also a vice chancellor of the Chancery Court in the 1980s and 1990s, stood by those concerns in an interview with The Associated Press but said she doubted the Delaware institution would go so far as to make him complete the deal.
“The court can impose sanctions and the court can kind of coerce Musk into taking over the company,” she said. “But why would the court do that when what really is at stake is money?”
Berger said she expects Twitter to prevail, but said a less tumultuous remedy for the company and its shareholders would make Musk pay monetary damages. “The court doesn’t want to be in a position to step in and essentially run this company,” she said.
Musk and his lawyers didn’t respond to requests for comment.
Other legal observers say such defiance is almost impossible to imagine, even from a famously combative personality such as Musk. He acknowledged he might lose in August in explaining why he suddenly sold nearly $7 billion worth of Tesla shares.
“I take him at his word,” said Ann Lipton, an associate law professor at Tulane University. “He wants to win. Maybe he’s got his own judgment as to what the odds are. But he’s also being sort of practical about this. He’s getting some cash ready so he doesn’t have to dump his Tesla shares if it turns out he is ordered to buy the company.”
A ruling of specific performance could force Musk to pay up his $33.5 billion personal stake in the deal; the price increases to $44 billion with promised financing from backers such as Morgan Stanley.
The Delaware court has powers to enforce its orders, and could appoint a receivership to seize some of Musk’s assets, namely Tesla stock, if he doesn’t comply, according to Tom Lin, a law professor at Temple University.
The court has made such moves before, such as in 2013 when it held Chinese company ZTS Digital Networks in contempt and appointed a receiver with power to seize its assets. But after coercive sanctions didn’t work, the receiver asked the court five years later to issue bench warrants calling for the arrest of two senior executives the next time they visited the U.S.
Speculation that Musk could be threatened with jail time for failing to comply with a ruling is unrealistic, said Berger. “At least, not for the Court of Chancery,” said the former judge. “That’s not the way the court operates.”
But more important, Lin said Musk’s legal advisers will strongly urge him to comply with the rulings of a court that routinely takes cases involving Tesla and other firms incorporated in the state of Delaware.
“If you are an executive at a major American corporation incorporated in Delaware, it’s very hard for you to do business and defy the chancery court’s orders,” Lin said.
Concerns about Musk’s compliance derive from his past behavior dealing with various arms of the government. In a long-running dispute with the U.S. Securities and Exchange Commission, he was accused of defying a securities fraud settlement that required that his tweets be approved by a Tesla attorney before being published. He publicly feuded with California officials over whether Tesla’s electric car factory should remain shut down during the early stages of the COVID-19 pandemic.
He’s also taken a combative approach in Delaware Chancery Court, calling an opposing attorney a “bad human being” while defending Tesla’s 2016 acquisition of SolarCity against a lawsuit that blamed Musk for a deal rife with conflicts of interest and broken promises. He and his lawyers have other Delaware cases still pending, including one involving his compensation package at Tesla.
“I think we’ve got a whole lot of players who, as loose a cannon as Elon Musk is, rely on the goodwill of the Delaware courts on an ongoing basis for their businesses,” Lipton said.
Musk’s argument for winning his latest Delaware case largely rests on his allegation that Twitter misrepresented how it measures the magnitude of “spam bot” accounts that are useless to advertisers. But most legal experts believe he faces an uphill battle in convincing Chancellor Kathaleen St. Jude McCormick, the court’s head judge who is presiding over the case, that something changed since the April merger agreement that justifies terminating the deal.
The trial begins Oct. 17 and whichever side loses can appeal to the Delaware Supreme Court, which is expected to act swiftly. Musk and Twitter could also settle the case before, during or after the trial, lawyers said.
Delaware’s courts are well-respected in the business world and any move to flout them would be “shocking and unexpected,” said Paul Regan, associate professor of Widener University’s Delaware Law School who has practiced in Delaware courts since the 1980s. “If there was some kind of crisis like that, I think the reputational harm would be all on Musk, not the court.”
Matt O’brien, The Associated Press
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