(Montreal) After welcoming new players for several years, the Canadian airline market is once again moving toward consolidation, increasing the likelihood of seeing higher prices and fewer flight options.
Since May, low-cost carriers Swoop and Lynx Air have ceased operations, while WestJet acquired Sunwing Airlines.
The latter two alone represent 37% of the seat capacity of direct flights to sun destinations, and 72% from Western Canada, according to a report from the Competition Bureau published last fall.
Some experts warn that the reduction in the number of airlines could lead to a reduction in service offering and an increase in prices, particularly in Western Canada and in the country’s smaller markets.
Director of the University of Manitoba’s Transportation Institute, Barry Prentice, points out that high airport rents, security fees and fuel taxes increase the base cost of each flight, making it more difficult for low-cost carriers looking to attract budget-conscious travelers.
Air Canada and WestJet account for 79% of domestic traffic this month, compared to 74% a year ago, according to statistics from aviation data company Cirium.
Company in this report: (TSX: AC)