Was it a magic looking glass that Air Canada CEO Calin Rovinescu saw through when he made the decision that his company’s future was in international travel?
Already two thirds of Air Canada’s profits are made from routes that go outside of Canada. And more recently they have moved quickly to shift flights from Western Canada to new overseas routes as much as possible.
Air Canada just reported a 2015 net income statement of $308 million, up from $105 in 2014. Speaking on an investor call, Ravinescu said, “Air Canada is specifically focused on seeking new international growth opportunities to generate increased profit,”
On the basis of adjusted income, the airline reported a profit of $1.2 billion, which was more than double its 2014 record of $531 million.
Even as this information was being processed, Westjet Airlines was reporting lower profits and prospects.
Westjet started as a Calgary based western company, and that is where most of its passengers have come from. Nearly 25% of Westjet’s business is Alberta based, and 40% of all its passengers travel via that province, especially through its Calgary hub.
They recently announced huge discounts for western flights in an effort to stimulate traffic.
Their holiday division, Westjet vacations, is suffering similar impacts as job losses in Alberta have continued to mount, and the usual winter travel market is holding onto its dollars.
In the last calendar quarter of 2015, Westjet’s profits sunk 27% from the previous year.
Westjet too is counting on greater success in an international growth strategy. Their four new wide bodied Boeing 767’s, which they only recently added, will start flying to London, England early this summer. Winnipeg will be one of the cities served with these non-stop flights.
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