VANCOUVER — The ULCC market opportunity has “never been greater”, says Canada Jetlines, as it continues on its path towards launch.
While providing its latest operational update, the carrier says that “due to proposed consolidations resulting from a surge in mergers and acquisitions activity in the Canadian airline industry, the ULCC market opportunity has never been greater”. Jetlines is no doubt referring to Air Canada’s potential acquisition of Transat, and Onex’s WestJet buy (even with today’s news that Air Canada has filed a challenge against the deal).
Jetlines also said it is “looking forward to the Competition Bureau announcing its position on its ongoing investigation into WestJet’s alleged predatory pricing through its subsidiary, Swoop.”
But while Jetlines says it’s “closer than ever” to starting operations, the company’s most recent launch target is now in question. “The Company continues to make progress on building out the airline and is now closer than ever to starting operations. The Company and SmartLynx are currently reworking the aircraft lease arrangements. However, the final date for airline launch is subject to meeting the financial requirements of Canadian regulatory authorities. The Company will provide further timing updates once the necessary funding commitments have been secured.”
Back in April 2019 Canada Jetlines said its launch date for commercial service would be Dec. 17, 2019. Talk of a launch has gone on for several years. In 2017 Jetlines was touting June 2018 the launch date. Those plans folded with a March 2018 announcement. There was also talk of a summer 2019 launch.
SmartLynx has agreed to extend the funding milestone to Sept. 30 under the definitive subscription agreement. As previously announced, SmartLynx will provide $7.5 million in financing under the terms of a convertible debenture, which matches the financing terms with InHarv ULCC Growth Fund.
“I am pleased that SmartLynx has elected to push out our funding milestone and would like to thank both SmartLynx and InHarv for their continued support as true partners of Jetlines,” said Mark Morabito, Executive Chairman of Canada Jetlines. “It is important to remember that SmartLynx specializes in full-service ACMI (Aircraft-Crew-Maintenance-Insurance) aircraft lease services and is the leading ACMI provider in Europe for Airbus A320 aircraft.”
Jetlines has also submitted all but one of the required operations manuals to advance its Air Operator Certificate (AOC) application with Transport Canada, and completed the incorporation of most of the required software systems. It continues to build out its operational team, which now includes a COO, VP Flight Oeprations, VP Maintenance, Head of Training, Chief Pilot, Flight Attendant Manager and Safety Manager.
Moreover, the company has completed the build of its new website and is now ready to sell tickets following the integration of its ancillary services partners, Booking.com and CarTrawler. It plans to deploy a launch campaign as soon as it receives permission to sell tickets.