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Monday,  May 20, 2024 8:33 AM 

Flair Airlines & Lynx Air in merger talks: reports

Flair Airlines & Lynx Air in merger talks: reports
Lynx & Flair are discussing a merger, reports say. (File photos)
Michael Pihach

Michael Pihach is an award-winning journalist with a keen interest in digital storytelling. In addition to PAX, Michael has also written for CBC Life, Ryerson University Magazine, IN Magazine, and Michael joins PAX after years of working at popular Canadian television shows, such as Steven and Chris, The Goods and The Marilyn Denis Show.

This story was updated on Thursday, February 15 at 11:41 a.m. EST

The consolidation of Canadian airlines may take a new turn as a merger between low-cost carriers Flair Airlines and Lynx Air is in development, multiple reports say.

The Airline Observer, an aviation news outlet, is claiming that an announcement about an alliance between the two companies is imminent. The outlet is reporting that Flair, which is partly-owned by Miami-based 777 Partners, would absorb Lynx. 

The Toronto Star is also reporting the story. The news outlet says it spoke to three separate industry sources, who confirmed that the two carriers are discussing a possible merger, saying that a deal could be announced as soon as Thursday (Feb. 15).

Speaking to The Star, Flair declined to confirm or deny that the two airlines were in advanced discussions about a merger.

Edmonton-based Flair Airlines currently has 20 planes in its fleet, while Calgary-based Lynx has eight. Both operate a fleet of Boeing 737s.

Rumours & speculation

PAX reached out to both Flair and Lynx for comment early Thursday. 

Flair responded, saying that as a company policy, "we refrain from commenting on rumours or speculation." 

"Our focus remains on delivering value to our customers and stakeholders through our products and services," a spokesperson wrote. 

Seeing red & green 

If true, however, the deal would change the course of Flair’s future.

The discount airline, since last year, has faced a number of post-COVID setbacks, from having four of its aircraft seized at the start of March Break in 2022 – a grounding that impacted some 1,900 customers – to the revelation that it owes more than $67 million dollars in unpaid taxes (arrangements to pay the amount have been made, says the airline’s CEO Stephen Jones). 

Flair’s growth has also slowed this year due to delays at Boeing as the plane manufacturer answers to U.S. regulators after a door panel blew out of an Alaska Airlines flight in January, grounding 737 MAX 9 planes for weeks.

READ MORE: Flair Airlines owes more than $67M in unpaid taxes

As of last fall, Flair’s plan was to boost its fleet to 26 Boeing 737 MAX aircraft in 2024, up from 20.

Flair has “changed the shape of aviation in Canada,

Jones said Boeing’s MAX program has faced a number of delays, telling the Canadian Press last month that planes that were supposed to arrive in spring won’t land at Flair until late fall.

“This is a tough industry," he told the news outlet. "The development of the financial performance will take some time."

At a Feb. 8 press conference, Jones reportedly said that Flair has “fundamentally changed the shape of aviation in Canada,” saying how the carrier has put “affordable travel in the hands of all Canadians.”

READ MORE: Flair investor sued by aircraft lessors over missed payments

At the time, his message to the public, despite negative headlines about the unpaid tax bill, was that they can “confidently book with Flair.”

Lynx Air, which flew its first flight in April of 2022recently announced that it would add Regina to its network this June with flights to Vancouver and Toronto.

Lynx Air entered the market with a plan to grow the low-cost model. (Lynx Air)

The “ultra-affordable airline,” which entered the market with a promise to improve customer service and grow the low-cost model in Canada, serves cities in Canada, the U.S. – including Orlando, Los Angeles, Las Vegas, Phoenix, Fort Myers, and Tampa Bay – and Mexico (Cancun).

Speaking to media this month, Jones said that 86 per cent of Flair’s seats were sold last year, flying more than 4.5 million passengers to more than 35 cities in Canada, the U.S., Mexico, the Dominican Republic and Jamaica.

Mergers & consolidations

The blending of Flair and Lynx would add to an already well-publicized merger in Canadian aviation. 

Last year, The WestJet Group completed its acquisition of Sunwing, a transaction that was first announced in March of 2022. 

Since then, WestJet has integrated all jets from its own low-cost subsidiary, the now-defunct Swoop, and it will do the same with Sunwing Airlines, a process that the company says will be completed by October 2024. 

Alexis von Hoensbroech, CEO of The WestJet Group, says the consolidations will enhance the airline's ability "to meet the diverse travel and product needs of all Canadians." 

This includes a plan to densify cabins and distribute costs across more seats.

As PAX first reported, WestJet’s 737-800s and MAX 8s, including legacy WestJet, Sunwing and Swoop planes, will be reworked to feature 180 seats – up six seats from the current configuration – including 12 Premium seats. 

READ MORE: WestJet to densify cabins, serve “broader spectrum of guests” following Swoop closure

Low-cost seats will be available on board, segmenting that part of the market within the airplanes, von Hoensbroech says.

The integration of Sunwing Airlines has so far had no impact on Sunwing Vacations, the tour operator. 

But last October, the "Sunwing Vacations Group" was announced, an entity that brings together five vacation and retail brands: Sunwing Vacations and WestJet Vacations, U.S. tour operator Vacation Express, travel retail businesses and Luxe Destination Weddings.

Michael Deluce called it

If Flair and Lynx do, in fact, become one, then it would potentially fulfill a prophecy recently shared by Michael Deluce, CEO of Porter Airlines.

In an interview with the Canadian Press in December, the CEO predicted that at least one Canadian airline would fold within the next two years.

Canada’s market is just too small, and too crowded, to keep all the current players active, he said at the time, noting how the traction just isn’t there.

In addition to Lynx and Flair’s activities in the low-cost space, there’s also newcomer Canada Jetlines, which is aiming to have 15 aircraft in the next 13 months.

Toronto-based Jetlines, this week, revealed that it will begin Halifax flights (serving Toronto and Orlando), starting this June.

This is a developing story.

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