No frills Flair Airlines should brace for bumpy ride, expert says

Thrifty frequent flyers will benefit from a low-cost airline taking off in Edmonton, but the carrier should brace for a bumpy ride, says an industry analyst.

Discount carrier selects Edmonton as main transfer hub

Flair Air currently operates a fleet of five Boeing 737-400s. (CBC)

Thrifty frequent flyers will benefit from a low-cost airline taking off in Edmonton, but the carrier should brace for a bumpy ride, says an industry analyst.

The Edmonton International Airport will be Flair Airlines' new main transfer hub, the carrier announced as part of a major network expansion on Monday.

The airline also announced that it will extend operations to three additional airports — the Toronto Pearson International Airport, Vancouver International Airport and Kelowna International Airport.

Flights between Toronto, Vancouver, Kelowna and Edmonton will take off several times a week.

'Stiff competition'

The discount airline claims it will have the lowest base fares in Canada and that it's poised to become an industry leader, though one analyst is less optimistic.

"It's still early days," said Marvin Ryder, a marketing professor at McMaster University.

"They've been around for 15 months and it's been a stumbling 15 months," Ryder said in an interview with CBC Radio's Edmonton AM. "There is a lot of experimenting and it's nice to see that they've survived the first year.

"Yes, this could all work out, and they could be a new competitor on the market for sure, but they're facing stiff competition."

Turbulent start

The airline will be competing with other low-cost carriers and Air Canada and WestJet.

Flair Air was linked to the troubled, and now defunct, NewLeaf, a discount flight provider. 

Flair bought out NewLeaf and Ryder said it will be interesting to see how the company operates  "now that Flair is in charge," but he warns the failure rate for airline companies in Canada is high.

Expanding its modest fleet, and moving into larger airports will be expensive. Keeping consumer costs down while maintaining profit margins will be a challenge, Ryder said.

While consumers will benefit from increased competition on prices, it remains to be seen whether Flair can get off the ground. 

"What they've learned in their first year of operations is that consumers are very picky," Ryder said.

"Yes, they want a low fare but they also want the convenience of being in the major market. So it will be interesting to see how an ultra low cost carrier like Flair can find that balancing point.

"How do they position themselves against WestJet and Air Canada? That's going to be their challenge."

'Rebellion against high fares'

Flair currently operates flights out of Abbotsford, Edmonton, Halifax, Hamilton and Winnipeg.

Flair will begin offering flights to the new destinations in December. Passengers can now book flights through to the end of 2018.

"This is just the beginning of many more announcements such as this," said Chris Lapointe, vice president commercial operations, in a news release on Monday. "We are adding more aircraft and as we do, our network will grow significantly."

Flair Airlines plans to be operating 12 aircraft by the spring of 2019.