WestJet boosts surcharge to cope with higher NavCan fees
By Ottawa Business Journal Staff
Wed, Jun 9, 2004 3:00 PM EST
WestJet Airlines of Calgary said Wednesday it will increase one of the surcharges included in its ticket prices due to rate hikes from Nav Canada.
NavCan, the not-for-profit federal agency that operates Canada's air navigation system, said last month it would hike the fees it charges to airlines and major airports in an effort to pull its bottom line out of the red.
The fee hikes, averaging 7.9 per cent, are scheduled to come into effect Aug. 1.
WestJet is the first major airline to formally respond to NavCan's plans, saying it must boost the existing surcharge to cope.
Depending on the distance traveled, the existing NavCan surcharge included in WestJet's ticket prices will increase by $9, $15 or $20 each way.
The increase will appear on tickets in August when NavCan's higher fees come into effect.
Last week, WestJet said its planes flew with fewer passengers in May as the airline offered fewer seat sales to entice travellers. Its load factor fell to 65.1 per cent from 72.2 per cent in May 2003.
"Although we are somewhat disappointed by this lower load factor, it has come about nevertheless as a result of WestJet reducing the number of seat sales we have intentionally offered in the market," chief executive Clive Beddoe said in a statement last Thursday.
"We have pursued this approach as a way to improve yields without further increasing base fares in the face of the extremely high price of fuel.
"We have adopted this as a short term strategy and will continue to monitor its success while ensuring that we remain competitive in the current pricing and cost environment."
WestJet is the largest rival to the country's top airline, Air Canada.
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WestJet boosts surcharge to cope with higher NavCan fees
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