Following the seizure of four of its aircraft by the planes’ leasing company at the beginning of March Break, Flair Airlines now admits the development will force it to make changes to its summer schedule.
According to a report the Globe, CEO Stephen Jones apparently admitted to the airline’s workers on 16MAR during a company webinar that the aircraft will not return to the fleet.
Open Jaw reported that same day that Transport Canada told Open Jaw that: “Airlines are required to inform Transport Canada if they have received a default notice when the default notice results in loss of custody and control of the aircraft. If the aircraft operator loses custody and control of an aircraft, for instance as a result of a lease default, operation of that aircraft by the operator would be prohibited by Transport Canada.”
Flair was apparently able to rent three aircraft and "wet lease" another as it scrambled to deliver on sold tickets during March Break. Wet leases of aircraft include flight crew, and come at a premium. Jones admitted the company couldn't afford to wet lease any more aircraft.
As a result of the loss of the repossessed planes, Flair will be making unspecified adjustments to its schedule. According to the Globe, the ULCC will have 21 planes and 1000 workers for the summer.
In the virtual meeting, the CEO also reportedly admitted that the seizure and publicity surrounding it has resulted in what he called a “slight” drop in ticket sales for the ULCC.
While publicly defiant and decrying the move by Airborne, the planes' leasing company, on the internal company webinar, Jones reportedly admitted the repossession and subsequent media reporting, "hit the brand hard and it hit us hard. Let’s not underestimate the impact this has.”
Shortly following the repossession of the aircraft, Jones publicly revealed in a statement that he blamed the lessor for working with an unnamed major Canadian airline to orchestrate the loss of planes for Flair to harm its business. The airline also launched a lawsuit against the company and its related businesses.
Airborne has firmly rejected the accusation. It says the planes were only seized after five months of missed payments "amounting to millions."
The dramatic and unprecedented seizure of aircraft comes, as the Globe notes, as Flair has been making aggressive expansions of its network and growing its fleet. The loss of those planes has "thrown those plans into question."
