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The invasion continues: Enerjet wants to relaunch as an ULCC in 2019

The invasion continues: Enerjet wants to relaunch as an ULCC in 2019

Friday, December 21, 2018

TORONTO — Apparently Canada needs another ultra low-cost carrier – or at least, there’s another one on the way.

One of the co-founders of WestJet, Tim Morgan, is heading up a consortium that includes Claridge Inc., a private investment firm chaired by Stephen Bronfman, and Stephenson Management Inc., where Cirque du Soleil chairman Mitch Garber has been chairman since 2008, to relaunch charter airline Enerjet as an ultra low-cost carrier in 2019.

Enerjet has been in operation since November 2008 as a charter carrier primarily aimed at transporting oilsands workers, with a fleet of B737s.

According to a statement posted Dec. 20, Enerjet, a licensed Canadian carrier, “will be rebranded, expanded and transformed into an affordable air-travel choice for Canadian travelers. This Canadian ULCC will offer a simple, ultra-low-cost fare structure and an extensive network of destinations across Canada and into the U.S.”

Another investor is Indigo LLP, an Arizona-based private equity firm that specializes in budget carriers such as Singapore’s Tiger Airways and Florida’s Spirit Airlines.

“We believe there are millions of Canadians who would jump at the chance to have a simple, safe, and affordable alternative to the sky-high costs of air travel,” says Morgan, who will serve as CEO. Morgan is a co-founder, former director and former chief operating officer at WestJet.

“We are extremely pleased to have the backing of leading Canadian investors and our partners at Indigo. Together, this group has the financial capacity, experience, and operating expertise to transform Enerjet into a world-class, ultra-low-cost airline that will bring increased choice and competition to the Canadian market,” he added.

Bill Franke, Indigo’s Managing Partner, says the consortium believes it can “significantly increase the size and competitiveness of Canada’s domestic and trans-border aviation market by offering an ultra low-cost alternative to the high cost of air travel. Our goal is to be in the market by this time next year to help more Canadians visit family and friends over the holidays and for years to come.”

According to reports, Morgan has been trying to take Enerjet into the budget carrier market for some time, but encountered hurdles after three former executives he’d tapped for that purpose sued Calgary-based Enerjet for breach of contract in 2015.

Canada has seen its share of low-cost carriers come and go over the years but interest in the sector has reached new heights. Flair is expanding, and WestJet, which got its start as a low-cost carrier in 1996, launched low-cost carrier Swoop this year. Air Canada Rouge recently marked its fifth anniversary. Most other mainline carriers have also launched their own LCCs and/or brought in basic economy fares. Canada Jetlines is still trying to get off the ground.

Meanwhile Canada’s transatlantic routes have attracted several LCCs and ULCCs, to varying degrees of success, from the now-defunct Primera and slimmed-down WOW to Norwegian, slated to start its new Dublin flights out of Hamilton in spring 2019.

 With files from The Canadian Press

Tags: Enerjet, ULCC
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