Lynx Air, a Calgary-based airline that launched lower than two years in the past with a promise to make air journey extra reasonably priced for Canadians, says it can stop operations on Monday.
The information got here because the low-cost airline introduced it had sought and obtained an preliminary order for creditor safety from the Court docket of King’s Bench of Alberta.
“Over the previous 12 months, Lynx Air has confronted quite a lot of vital headwinds together with rising working prices, excessive gas costs, change charges, growing airport costs and a tough financial and regulatory atmosphere,” mentioned the corporate in a information launch.
“Regardless of substantial progress within the enterprise, ongoing operational enhancements, value reductions and efforts to discover a sale or merger, the challenges going through the corporate’s enterprise have grow to be too vital to beat.”
The airline mentioned it can stop operations at 12:01 a.m. MT on Monday, “with flights persevering with to function till that point.”
Osler, Hoskin & Harcourt LLP are performing as authorized advisers to Lynx Air. FTI Consulting Canada Inc. was appointed because the monitor below the Firms’ Collectors Association Act.
In an e mail assertion to CBC Information, a spokesperson with the airline mentioned that “rising monetary pressures have made it unattainable” to proceed operations.
“We’re targeted on working with passengers presently in transit to search out different preparations to succeed in their vacation spot,” the assertion reads.
The corporate mentioned passengers with present bookings are suggested to contact their bank card firm to safe refunds for pre-booked journey. It additionally directed clients to its web site.
Flight cancelled, passengers scrambling
However Lynx Air buyer, Kara Brereton-Cooke, says her flight house to Winnipeg, which was scheduled for Saturday, has already been cancelled.
Brereton-Cooke mentioned she acquired an e mail from Lynx Thursday night following the announcement, advising that her flight from Vancouver to Winnipeg was cancelled. She and a bunch of seven mates have been left scrambling to discover a approach house.
“Seeing this e mail, we’re now all simply frantic.”
The buddies travelled to Vancouver for a bachelorette celebration, and had been initially slated to fly house Friday. Brereton-Cooke says Lynx Air then rescheduled the unique return flight to depart at 11 a.m. on Saturday, however then cancelled it completely.
The group booked an further night time of resort lodging for Friday night time after their flight was rescheduled. Now, they’ve booked last-minute flights via Air Canada for Saturday. The journey has grow to be dearer than anybody anticipated, she advised CBC Information.
“We simply need our compensation again from them,” Brereton-Cooke mentioned. “We should not should undergo our bank card firms to get a refund.”
CBC Information contacted Lynx Air for a touch upon the Saturday flight cancellation however haven’t but acquired a response.
WestJet — one other Calgary-based airline — has since responded to the information of Lynx Air’s halt to operations.
WestJet affords reductions
“We acknowledge the fast influence this data has on passengers and workers of Lynx, and we’re dedicated to helping the place we are able to via quite a lot of actions,” reads the assertion posted to their web site on Thursday night time.
The airline is providing offers to these impacted by Lynx’s announcement, specifically a 25 per cent low cost for all financial system fares between Feb. 22 and Oct. 26 on WestJet routes which had been beforehand served by Lynx Air.
Lynx Air’s flight attendants had simply joined the Canadian Union of Public Workers (CUPE) earlier this month.
“We’re devastated for our members at Lynx Air and all workers who misplaced their jobs right now,” Lou Arab, communications consultant for CUPE, advised CBC Information.
“We are going to characterize them and defend their rights in these instances and we’ll battle to make sure that workers get every little thing they’re legally entitled to.
“The corporate was clear that it is shedding buyers and would not have the capital to help continued operations.”
Airline business is ‘notoriously tough’
Deborah Yedlin, president and CEO of the Calgary Chamber of Commerce, mentioned she suspects airport costs performed a serious function in Lynx’s resolution.
“I believe the airport charges as they’re structured makes it onerous for low cost airways to achieve success in Canada long run,” she mentioned.
“There’s been a confluence of occasions that is actually put lots of downward stress on the airline enterprise… So whenever you’re a reduction participant and your margins are even tighter, you are going to really feel the financial headwinds that rather more acutely.”
Yedlin calls the business “notoriously tough,” citing varied post-pandemic challenges reminiscent of labour shortages and elevated gas prices.
She says Lynx Air’s announcement is unlucky for Calgarian shoppers hoping to avoid wasting on journey prices.
“I believe the query is, what do we have to do in Canada to make sure the viability of low cost airways?”
Extremely-affordable providers promised
Privately-owned Lynx Air, which was previously Enerjet, launched in April 2022, with a promise to carry ultra-affordable providers to travellers. Lynx Air’s inaugural flight was in April, 2022, jetting from Calgary to Vancouver.
When it introduced its plans in 2021, the corporate’s CEO on the time mentioned the aim was to hyperlink Canadians to folks and locations.
“Airfares have historically been excessive right here in Canada, and we at Lynx consider in assembly Canadians’ wants who cannot afford to journey or cannot afford to journey as typically as they’d like,” mentioned Merren McArthur, who stepped down final 12 months for private causes.
When the corporate introduced its launch, it mentioned it had leased 46 new Boeing 737 plane. Final June, McArthur advised the Calgary Herald it employed about 420 folks.
Lynx started flying to a number of Canadian cities in 2022, together with Calgary, Edmonton, Halifax, Toronto, Vancouver and Victoria, B.C.
Later that 12 months, it introduced a serious growth into america and adopted that with the launch of a sequence of worldwide flights in 2023, together with Montreal to Las Vegas, and Toronto to Los Angeles, amongst others.
Transport Minister Pablo Rodriguez addressed the information by way of social media on Thursday night.
In a statement posted to X, previously referred to as Twitter, Rodriguez mentioned he’s following the announcement carefully.
“For any travellers that had a return flight booked with Lynx, I anticipate Lynx that will help you get again house as quickly as attainable. I anticipate Lynx to totally refund you in case your fare will not be honoured,” the assertion reads.
“My workplace has been in contact with Lynx, we’ll proceed to speak with all events, and we have convened calls with different airways to see how they may also help, to make sure that passengers are put first.”
