Canadians at risk of fare fatigue with new travel options
From lie-flat seating and BMW valet service to no frills ticket options, passengers have many new choices
Buying an airplane ticket used to be simple: economy or first class. Now, there are many more options and considerations. As the industry becomes more competitive, Canadian airlines are trying to keep up.
On June 1, Air Canada will launch Signature Service in North America, a service offered since April 17 for international customers providing a seamless airport experience with dedicated check-in counters, expedited security clearance, lounge access, exclusive boarding lanes, priority baggage handling and more.
Luxury options include lie-flat seating and BMW valet service
"Later this year, Air Canada Signature Class customers will be offered Air Canada Valet Service, powered by BMW across the tarmac when connecting from a domestic to an international flight at Toronto Pearson," reads the description on the Air Canada website. "We're proud to be the first airline in North America to guarantee this service to customers travelling in a premium cabin, and we plan to extend it to other customers in the future."
That means no walking through the terminal and waiting at the gate. And if you want a lie-flat suite for sleeping, Air Canada will soon offer them on North American non-stop overnight flights to Vancouver, Los Angeles, and San Francisco. Not to be outdone, WestJet will unveil Boeing Dreamliners next year, larger, fancier planes for new international flights.
"We will have a lie-flat business class section for those who are planning to make their trip, either in the luxury category as a leisure traveler or for people who have to get off the plane and go to work," said Gregg Saretsky, former president and CEO of WestJet.
No frills ticket options available for budget-conscious passengers
Airlines aren't just increasing the more expensive options; they're also offering cheaper options too. Air Canada provides "economy basic" fares, which restrict any changes to the ticket (even for a fee) and don't provide Aeroplan miles on bookings. Meanwhile, WestJet offers "econo" fares, which can save passengers approximately $25 each way, depending on the route.
Economist says too many options "confusing" for customers
Fred Lazar, an economist at York University's Schulich School of Business, has tracked airline industry trends for decades. He believes there are too many options for customers, and that airlines won't make much money on these new initiatives.
"You can always add more fare classes, but at some point, it does become very confusing," said Lazar. "The more of these fare classes you throw in, the more complex that system becomes, the more costly it becomes to operate and the less efficient it becomes. I would argue they're probably now at too many."
Passengers booking with Air Canada, for example, can choose from seven different types of fares. Lazar says Canadian airline companies are attempting to emulate what American companies, like United, American, and Delta, have already done by introducing basic economy fares.
"[They're] positioning themselves with a new fare category where they can compete against an ultra-low-cost carrier or maybe even Swoop, if necessary."
Swoop is WestJet's new ultra low cost airline scheduled to begin service in June and is meant to compete with Flair Airlines, another Canadian ultra-low-cost carrier.
All these options may sound confusing, but Lazar says this is not unique to the airline industry and customers should take the extra time to review all the fine print before booking.
"Think of your wireless service. It's not a case of 'gee, I want to renew my subscription, and okay, here's your service.' You have many different options, and most people don't go through all the possibilities," said Lazar. "Complexity does cause confusion, but it's not specific to this industry."