“I think WestJet was doing too many things, trying to be too many things to too many people, and we need to focus on those areas that made WestJet strong in the first place,” CEO Alexis von Hoensbroech said.
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Alexis von Hoensbroech spent the first 10 1/2 months as WestJet CEO laying the groundwork for change: 2023 will be all about seeing his plan in action.
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The new direction is more of a course correction, an attempt to bring the Calgary-based airline back to its roots in a world emerging from two years of pandemic restrictions and lockdowns.
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This means more centralization in Western Canada while looking for ways to make flying more affordable and improve the product.
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“2023 will be the year that we implement a lot of the strategy,” he said. “If you look at an airport like Calgary, we’re going to see growth of more than 25 percent from 2022 to 2023. So this is a lot of additional capacity and it will come with quite a few additional routes.”
Von Hoensbroech was named CEO on December 17, 2021 and landed in Calgary to officially assume the role in mid-February.
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He was considered a rising star at the Lufthansa Group, having previously served three years as CEO of Austrian Airlines, that country’s largest airline before the pandemic as a low-cost option with a large presence in central Europe and Oriental.
Returning to pre-pandemic levels
Challenges remain as the airline industry continues to recover from two years of COVID-19 restrictions and health orders. WestJet was the only major Canadian airline not to accept pandemic-related assistance from the federal government, instead taking on hundreds of millions of dollars in losses and debt.
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“I think WestJet was doing too many things, trying to be too many things to too many people, and we have to focus on those areas that made WestJet strong in the first place,” von Hoensbroech said.
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By 2022, the airline is operating at 78 percent of pre-pandemic levels, with federal restrictions on flights and cross-border travel in effect through Oct. 1. In December, the airline is operating at 90 percent of pre-pandemic levels. levels, averaging around 600 flights per day with 65,000 guests, and forecasts a return to 2019 numbers by the second or third quarter of 2023.
This was before extreme weather wreaked havoc on the airline industry over the holiday season. Between December 18 and 26, WestJet canceled 1,450 flights due to winter storms across the country, affecting thousands of travelers. On December 23 alone, 333 flights were cancelled.
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The first major announcement von Hoensbroech made after taking office was announcing the acquisition of Toronto-based vacation destination airline Sunwing. In October, the Federal Competition Office raised concerns about the merger and the deal is still in the regulatory process with a final decision not expected until the new year.
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The acquisition would strengthen WestJet’s position in the sun travel sector, with Sunwing owning 45 hotels in destinations throughout Mexico and the Caribbean.
Competition increases with the launch of new airlines
Competition, particularly in Western Canada, has only increased for WestJet this year.
Edmonton-based Flair Airlines has worked to expand its presence, while Lynx Air launched in Calgary in April, Jetlines started in Toronto in September and Porter Airlines began expanding its network west of Toronto with new routes to Calgary and other destinations. Before the pandemic, there were only two airlines flying from Toronto to Vancouver, and by next summer there will be five or six.
Competition has largely occupied WestJet’s low-cost market.
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“In the end, I don’t really care what they do. What matters to me is what we do, and we do what we’ve always been good at, which is being ruthless on cost,” von Hoensbroech said, adding that it will lead to lower ticket prices.
New vision, announced routes
In June, the new CEO unveiled his vision for WestJet.
The airline canceled all orders for 787 Dreamliners, bringing its wide-body fleet to seven, while announcing a focus on narrow-body jets. WestJet has since increased its 737 Max purchase order with Boeing from 23 to 65.
By making this pivot, WestJet has made Calgary International Airport its hub for Dreamliners, while relaunching routes to London, Paris and other European destinations.
New routes to Edinburgh and Barcelona were announced in December. The airline also introduced its first foray into Asia with a nonstop flight to Tokyo. Von Hoensbroech said the company will continue to monitor demand for new destinations.
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The strategy also outlined a restructuring of the regional service, particularly in Western Canada with its De Haviland Dash 8 fleet.
Environmental sustainability a focus point
Meanwhile, WestJet will continue to work towards environmental sustainability in the new year. The new 737 Max planes on order are more efficient than most planes in the segment, and the airline launched a biofuel pilot project this fall for its San Francisco to Calgary route.
“Sustainability and emissions reduction is one of the biggest challenges facing our society, and we as the aviation industry have to do our part to help support that,” said the CEO.
It hasn’t all been wins for WestJet in 2022.
A cooling problem with the company’s servers caused a system-wide outage in November, causing hundreds of flights to be canceled and stranding thousands of passengers.
Von Hoensbroech called it a costly lesson, saying they have “doubled down” on detecting deficiencies in the IT system to avoid a similar situation.
“That is what we owe our guests,” he said. “When it comes to the resiliency of our internal setup, like our IT system, it’s our responsibility to our guests to fix this, and we’re fixing it.”
Twitter: @JoshAldrich03