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Mon, Mar 20, 2023

Flair Airlines Weathers Squall of Unhappy Customers

SIGMET in the North

Flair Airlines, the Edmonton, Alberta-headquartered Canadian ultra low-cost carrier (ULCC) which promotes itself as being Canada's first and only independent ULCC, has, of late, suffered repeated tarnishings of its reputation.

Following months of customer complaints pertaining to flight delays and cancellations, four of Flair’s Boeing 737 MAX narrow-body jets were repossessed by Airborne Capital—the entity from which the carrier leases its aircraft—over claims of lease nonpayment.

The repossession occasioned extensive rescheduling of Flair flights which adversely impacted nearly two-thousand passengers mere days before the zenith of the profitable March spring-break season.

Flair endeavored to persevere, pulling three aircraft from storage and hastily returning them to commercial service. The disruption and loss of face compelled Flair Airlines president and CEO Stephen Jones to blame his company’s woes on competing Canadian air-carriers—which Mr. Jones alleged seek to drive Flair out of business.

“I think there were behind-the-scenes negotiations between one of the larger airlines and the lessor to hurt Flair by probably offering them above-market rates for the aircraft we have been leasing,” Jones stated during a 13 March 2023 press conference. Notwithstanding Mr. Jones’s assertions that he would neither name names nor cite evidence, his remarks clearly and concisely allude to Canadian flag carrier Air Canada and WestJet—the Great White North’s first and second-largest air-carriers respectively.

Mr. Jones set forth that Flair was only a few days late in making a $1-million payment on the four Boeing 737 MAXs—a dollar-figure that represents about half-the company’s average 24-hour earnings.

2020’s COVID issues and the Canadian government’s lockdowns prompted most Canadian airlines to renegotiate leasing contracts for drastically lower overall values. Aircraft lessors, cognizant of the fact that the problems had relegated their aircraft to virtual uselessness, were content to accept lower payments for such in lieu of outright defaults on lease contracts.

Came then the airline industry’s remarkable 2121 recovery, which brought record-high passenger volumes and sent the values of aircraft leases skyrocketing—especially as aircraft OEMs like Boeing and Airbus struggled to keep their supply-chains functioning and their deliveries of new aircraft in step with unprecedented demand. The sudden revitalization of the airline industry afforded aircraft lessors the thitherto unheard of latitude to immediately repossess their aircraft—in the event of breach of contract—and place them with other airlines on more favorable (read profitable) terms.

The peculiars of aircraft lease agreements were of little concern to the thousands of Flair customers who’d borne the brunt of the airline’s ostensible mismanagement of its assets. On Tuesday, 14 March 2023, Flair advertised a 35-percent sale on its base fares for spring. Air-travelers, acutely aware of the airline's prevailing troubles, found the timing of the impromptu sale odd in the extreme.

A fierce backlash ensued.

In response to Flair’s offer, customer Buck Buchanan wrote: “Sure, if you let people on the planes, if, in fact, you have planes.”

Mr. Buchanan was one of many who overtly expressed their dissatisfaction with the airline. A few less disgruntled passengers maintained decorum, replying to Flair’s offer with varying iterations of “No thank you.” Most, however, were decidedly less diffident.

Flair downplayed the backlash, stating in an email: “We are proud to have returned to normal operations across our network. Customers with bookings in the coming months do not need to be concerned. Travelers can be assured Flair Airlines will continue to fly our schedule, and book new travel with confidence.”

Mr. Jones added: “We know our presence results in lower fares, and we’re dedicated to continuing to serve Canadians. There are airlines that don’t want Flair to exist. But Flair will fly. And we will thrive. We will continue to deliver the lowest fares on offer to Canadians.”

FMI: www.flyflair.com


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