Good Morning All:
This is off of Reuters but the interesting part of this is at the last of the report.
The aircraft comes from North American Airlines which will not only lease the aircraft but with pilots, flight attendants and maintenance engineers.
It would be intersting to hear from our friends in CYYC how this went over when it was announced by their management.
WestJet lease of bigger plane spurs long-haul talk
Stocks
WestJet Airlines Ltd.
WJA.TO
$13.77
+0.00+0.00%
12:00am EST
Air Canada, Inc.
ACa.TO
$3.64
+0.04+1.11%
12:00am EST
Air Canada, Inc.
ACb.TO
$3.63
+0.02+0.55%
Dec 21, 2010 3:48pm EST
Current fleet comprised only of Next-Gen 737 aircraft
International routes proving to be profitable
VANCOUVER Dec 21 (Reuters) - WestJet Airlines Ltd's (WJA.TO) announcement on Tuesday that it will lease a big long-range plane has sparked speculation the airline is thinking of abandoning its commitment to a single-type fleet of planes so that it can fly longer-haul routes.
WestJet, Canada's second-biggest airline, said on Tuesday it will operate a leased Boeing 757-200 to provide nonstop service between its base in Alberta and Hawaii from mid-February to end-April next year.
Until now, WestJet has operated a fleet of Boeing Next-Generation 737 aircraft, flying to destinations in Canada, the United States, the Caribbean and Mexico.
The single-type fleet has been a key plank in its low-cost strategy as flying only one type of plane reduces costs such as training and maintenance.
But the 737's range is limited and WestJet could be looking for avenues to expand.
"We view the news as an indication that WestJet may introduce larger aircraft into their fleet going down the road in an effort to compete on longer-haul routes," RBC Capital Markets airline analyst Walter Spracklin said.
"Other airlines are growing significantly in international routes due to the sizable demand. We know these are profitable routes," he said.
Air Canada (ACa.TO) (ACb.TO), WestJet's bigger rival, boosted operating income five-fold in its most recent quarter, partly because of strong demand on international routes.
WestJet said there was no truth to the talk that it would add variety to its fleet to fly further afield.
"This is not the beginning of a new fleet type or a fleet change, but rather, a clear demonstration that we have the creativity, flexibility and commitment to assert our competitive advantage in the market, particularly in Alberta," spokesman Robert Palmer said.
The winter and spring months are a popular time for Canadians to escape to warmer destinations such as Hawaii. WestJet last spring also operated a nonstop flight from Alberta to Hawaii using its own 737-700 aircraft, but it could not sell all the seats due to weight and fuel constraints.
WestJet is leasing the 757-200 from North American Airlines, a charter air service provider and a subsidiary of Global Aviation Holdings [GLALG.UL].
North American will provide pilots, flight attendants and maintenance engineers to operate and service the aircraft.
WestJet's stock was down 1 Canadian cent at C$13.70 on the Toronto Stock Exchange on Tuesday afternoon against the trend of a firmer market.
($1=$1.02 Canadian) (Reporting by Nicole Mordant; editing by Peter Galloway