WJ completely undermined yields / revenues in Western Canada, the only area Canadi>n had been consistently profitable prior to 1996, and whose profits underwrote the money losing operations in central and eastern Canada + transborder, Latin America and pretty much everywhere else.
If you recall, $350 fares got slashed to $59 on Alberta-BC and Alberta Saskatchewan, $250 fares got cut to $29 on intra-Alberta and $450 fares from Alberta to Manitoba dropped to $79.
Revenues completely collapsed as Canadi>n had no choice but to match fares on all of its western capacity to stay competitive with WJ's small, but rapidly expanding capacity. Any let would have caused WJ to have expanded even faster than they already had.
No one likes to admit they got spanked in front of the hometown crowd,, but that's precisely what happened.
As for C3000, Lecky and Kinnear became obsessed with WJ's growth and profitability and the huge wealth that was created when WJ went public. As you recall, C3000 had been stagnant for years with 8-11 aircraft. They wanted a piece of the action to compete with WJ for the #2 airline after Canadian went banco and who's carcass was bought up by AC.
Lecky and Kinnear engineered the buyout of CJ and Royal and tried to cobble together something that could compete with WJ. The over expansion failed miserably, with 9/11 and Tango not helping the cause, though WJ had to deal with 9/11 and Tango at the same time, and remained profitable and growing at 30% rates.
It is not a coincidence that WJ has done what it's done over the past 13 years and left a trail of shutdowns, failed mergers and CCAA filings for virtually every other sched carrier of any consequence in it's wake.
Anyone considering a career as a commercial pilot or thinking about relocating back to Canada should pay attention to the big picture if they want a long lasting career with an airline in Canada, because history typically repeats itself.
The prospect of the three best run, most profitable, fastest growing, most cash rich airlines in North America, Volaris, Southwest and WestJet, hooking up will make the prospects of sched success in Canada for anyone else appearing on the scene to be very daunting, unless they can dramatically lower their costs to a level at least 25% lower than WJ's.
I can't see that happening. Can you?
