WestJet CEO Alexis von Hoensbroech says Canada needs a National Aviation Strategy to stabilize the industry amid high fuel costs and regulatory pressure. Speaking at the Calgary Chamber of Commerce, von Hoensbroech argued that the current system lacks the resilience needed to handle price shocks.
Financial pressure mounts for carriers
Fuel costs have risen sharply, squeezing carriers that cannot pass the full expense to passengers. While ticket sales cover part of the increase, airport and navigation fees, passenger protection costs, and taxes eat into margins. WestJet has absorbed these pressures without direct government funding for three decades, but the current environment is testing that model.
The airline claims that recent federal support for other carriers has distorted competition. Self-funded operators now face a disadvantage when competing against fares backed by public financing. Von Hoensbroech stated that governments should not intervene in markets if they want a healthy industry.
Canada ranks 105th out of 119 countries in airline cost competitiveness. The burden on Canadian carriers is significantly higher than in the United States. Airport improvement fees average $40 in Canada, compared to a $4.50 cap in the U.S. Canadian airlines also cover all air-navigation costs, whereas the U.S. model subsidizes these expenses. Additionally, Canadian carriers pay for passenger-rights costs, emission offsets, and some of the highest taxes and fees globally. The airline workforce also faces repeated disruptions, while the U.S. has remained stable for decades.
Regional growth as a blueprint
Calgary has become a focal point for WestJet’s expansion plans. The airline serves more than 100 non-stop destinations from the city, nearly double its pre-pandemic total. An October 2022 memorandum of understanding with the Government of Alberta formalized this growth strategy, making Calgary the sole global connecting hub for WestJet and basing its widebody fleet there.
This collaboration helped secure a 15-year, multi-billion-dollar contract for a Lufthansa Technik engine repair facility and a 126,000-square-foot CAE training Centre of Excellence with eight full-flight simulators. These investments strengthen Calgary’s aerospace ecosystem. Von Hoensbroech noted that the city achieved this growth by aligning policy decisions behind a common goal, rather than changing one policy at a time.