It's a tough business, trying to run an airline while making a profit. Few have been able to do it in Canada in the days since al-Qaeda militants changed air travel forever by using four airliners to launch attacks in the United States on Sept. 11, 2001. Spiking fuel prices didn't do much for the industry's bottom line, either.

Wardair – one of the country's first discount air carriers – hung on for 37 years before it was bought out by Canadian Airlines, which was the offspring of the merger between CP Airlines and Pacific Western. By 1999, it would be bought out by Air Canada.

Greyhound Air, Roots Air and Royal all tried but failed.

WestJet opened for business in 1996 as a low-cost airline serving mainly Western Canada. As other airlines folded or were bought out, WestJet slowly expanded its reach until it hit the East Coast and vacation spots in the United States.

Canada 3000 shutdown strands thousands

CanJet did the same from its base in Halifax, beginning in May 2000. Within a year, it was bought out by Canada 3000 – at the time, the country's second-largest national air carrier. It, too, buckled under the pressures of competition for a profitable slice of a dwindling air travel pie. On Nov. 9, 2001, Canada 3000 abruptly ceased operations, leaving thousands of travellers looking for other ways to get home.

The hole left by the departure of Canada 3000 was filled less than a year later by the arrival of Jetsgo – and the return of CanJet under a new owner. Jetsgo reported sales of $2 million in its first week of operations. Both "no frills" airlines were off to promising starts.

Still, the turmoil in the skies continued as Air Canada filed for bankruptcy protection on April 1, 2003, after suffering a string of heavy losses. It would remain under the protection of the courts for 1½ years, emerging as a leaner, more efficient airline.

Rising fuel prices wreak havoc in 2005

But 2005 got off to an ominous start as fuel prices rose steadily and the need to keep the lid on ticket prices proving a bitter combination for the global airline industry.

Traffic had begun to rebound over the previous year, easing the hangover from the Sept. 11 attacks that had sent an already stalling industry into freefall.

Two of the largest U.S. airlines, United Airlines and US Airways, were in bankruptcy protection.

A third, Delta, warned in March 2005, that it was losing a lot of money and might file for bankruptcy protection, too.

In February, Canada's WestJet declared its first quarterly loss in eight years, blaming the shortfall on the fact it was replacing a large chunk of its fleet.

Air Canada, on the other hand, which emerged in September 2004 from 18 months in creditor protection, announced a profit in the final quarter of 2004.

Air Canada's profit came in spite of a complaint heard around the industry: jet fuel prices were killing them. Air Canada said its fuel cost $142 million more in 2004 than in the previous year, an increase of 49 per cent.

Delta reported a loss of $5.2 billion in 2004, the largest single-year loss ever for a U.S. airline.

Jetsgo folds after fighting 'without a war chest'

Stranded passengers

Intense competition at the ticket counter meant that airlines couldn't pass on those fuel costs to their customers by increasing ticket prices.

The competition was brutal – and possibly no airline competed as hard as Jetsgo, which operated under the motto: "Pay a little. Fly a lot." In late 2004, the airline was selling some seats for $1.

It was a bankruptcy in the making, said airline analyst Joe D'Cruz of the Rotman School of Management.

"Jetsgo had been an airline in serious financial stress for quite some time, and in the middle of that they decided to take on WestJet in a price war," he told CBC News. "Here's an airline trying to fight a price war without a war chest."

On March 11, 2005, Jetsgo was gone, despite having captured up to 10 per cent of the domestic market. Thousands of passengers were stranded and 1,200 employees were suddenly out of work.

CanJet drops scheduled airline business

CanJet and WestJet stepped up to pick up some of the demand. CanJet, which resumed operations in 2002 with three old Boeing 737s flying to three destinations, had expanded its fleet to 10 aircraft and 14 North American destinations. It retained its focus on Atlantic Canada. It also began operating a small charter business.

In June 2006, CanJet celebrated its fourth birthday with a huge cake and lots of optimism for the future.

Three months later, on Sept. 5, the airline's chairman announced that CanJet was getting out of the scheduled airline business to focus on its charter operations.

"With the rising business risks of operating a scheduled airline, IMP has decided to suspend year-round scheduled airline service and focus on their increasing charter business," said Kenneth Rowe, the chairman and chief executive officer of parent company IMP Group Ltd.

The move left some people worried that Atlantic Canada would be under-serviced by the major carriers.

Harmony Airways pulls plug

In March 2007, Vancouver-based Harmony Airways announced it would stop all of its scheduled service by early April. Its billionaire owner, David Ho, called it a restructuring to focus on other opportunities. "I want to be very clear, this is not a bankruptcy. This is not a creditor protection arrangement and this is not a company dissolution."

Ho blamed increasing costs, overcapacity in the market and "aggressive price competition from larger carriers." About 350 staff will be laid off.

By 2007, Air Canada and WestJet were regularly reporting fuller planes and rosier bottom lines. But for smaller carriers, the news hasn't been as good. The Canadian airline business remains a risky place.