WestJet: Southwest Delay A 'Hiccup'

By Andrew Compart

WestJet President and CEO Sean Durfy described the delay in code sharing with Southwest as a “hiccup” May 28 during the airline’s Investor Day gathering, during which the airline also disclosed that it has talked to more than 70 airlines worldwide about potential partnerships.

The Canadian low-cost carrier announced earlier this week that Southwest was delaying the planned implementation of code sharing in the fourth quarter this year, and a Southwest spokeswoman subsequently said the earliest it would be implemented would be late 2010 (DAILY, May 27). WestJet had looked to that code sharing and “virtual” expansion of its U.S. network to help build its transborder service and appeal to corporate travelers.

Durfy and other WestJet executives said they have great opportunities with other partners that it can implement fairly quickly, including an already announced one with Air France and KLM that it is speeding up to start in-bound interlining later this year in light of the Southwest delay.

WestJet executives said they talked May 27 to Southwest Chairman, President and CEO Gary Kelly, who assured them the airline is “committed” to the relationship. Kelly and Bob Jordan, Southwest’s executive VP-strategy and planning, will be visiting WestJet in June, they said, and the airlines still could move forward this year on some cooperation on movement of cargo. Southwest already activated a booking link for WestJet on its Web Site in December.

Also during Investor Day, WestJet revised its capacity guidance for 2009 to a growth rate of 3%, down from its previous guidance of 5%, which was a revision from earlier guidance of 8%.

Most of the new reduction will come from a decrease in aircraft utilization from 12.3 hours a day on average to 12 hours a day, largely by getting rid of some late-night flights and weak performing flights on certain days of the week, said Chris Avery, VP-revenue and planning.

WestJet, however, still is projecting a 10% annual growth rate through 2013, by which it expects to have grown from 86 aircraft at the end of this year to 121 by the end of that year, Avery said.

In that time it expects to add service to six to eight new U.S. cities and about 10 new Caribbean destinations, Durfy said.

In this global recession, however, that’s not the airline’s most immediate concern. Durfy, for example, said WestJet recently launched a program seeking employee input to eliminate another $25 million in annual costs over the next six months.

Photo: Boeing

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