Air Canada Jazz, which already flies to Whitehorse and Yellowknife, will begin flying ti Iqaluit in March. (CBC)

Canada's two major northern airlines can blame themselves in part for a price war Air Canada started in Nunavut this week, according to an aviation expert.

Air Canada Jazz announced not only that it will begin flying between Iqaluit, Ottawa and Montreal in March, but it would do so at an introductory price of $659 one-way before taxes and fees.

That price is around $200 lower than what northern carriers Canadian North and First Air currently offer for similar flights.

Both airlines responded by cutting their fares to $599, which Air Canada has since matched.

'Didn't sharpen their pencils'

But Rick Erickson, a Calgary-based independent commercial aviation analyst, questioned why the two northern airlines did not act sooner to delay or prevent Air Canada's entry into the Nunavut market by lowering their fares.

"I wonder why the indigenous carriers left your markets so attractive. You know, those yields are very, very high, and I'm just wondering why they didn't sharpen their pencils a little bit more," Erickson told CBC News on Thursday.

"They should have been much more aggressive on their pricing strategy to take the attractiveness off of that route for southern competitors."

A one-way fare from Iqaluit to Ottawa booked for Nov. 18 starts at $913, before taxes and surcharges, on both Canadian North and First Air. With taxes and surcharges, that comes up to $963.55.

The base fare for that flight is $895 on both airlines.

Coveted market

Erickson said it was clear when Air Canada Jazz came to Yellowknife several years ago that national airlines like Air Canada and WestJet are interested in the North.

"Air Canada, I think, has looked very covetously at the yields available in the Iqaluit market," he said.

"I'm not surprised that they've announced service into it, because the amount of money they can make on a per-mile basis is triple, quadruple what they can get in the South."

The price war benefits travellers the most, but Erickson said it will ultimately hurt the northern airlines' financial situations.

First Air and Canadian North hope to draw customers with existing perks such as complimentary hot meals and a greater baggage allowance.

Air Canada Jazz may not have those perks, but it offers an in-flight entertainment system and connecting flights to locations around the world.

Planes certified to -40 C

One thing Air Canada would not be able to do in Nunavut is fly in extremely cold Arctic conditions, since the plane it plans to use is certified to operate to -40 C.

Still, airline officials say they believe the 75-seat Bombardier CRJ-705 aircraft it intends to use on the Iqaluit route is a good choice in the North, since it is rare to encounter weather colder than -40 C, company spokesperson Manon Stuart said.

"It has happened, occasionally. I remember that in Whitehorse last year, they experienced … weather in the range of -50 C," Stuart said.

"So unfortunately, in this extreme cold weather, we are unable to operate the aircraft. We have no alternative but to cancel the flight."

With files from Patricia Bell