WestJet says no cuts, sticks with expansion plans

June 17, 2008

WestJet Airlines Ltd will not follow Air Canada with moves to cut staff or capacity in the face of high fuel costs as its fleet and seasonal capacity shifts make such measures unnecessary, an executive with the No. 2 Canadian carrier said on Tuesday.

"It's business as usual for us -- no plans for capacity cutbacks, no plans for layoffs," WestJet Vice President Richard Bartrem said."

The airline moves its capacity between domestic and international routes twice a year, based on Canadians' travel patterns, a strategy that has kept traffic numbers and yields strong.

WestJet has predicted a 16-percent capacity increase this year. It plans to add two more new-generation Boeing 737 aircraft over the remainder of this year and another seven in 2009, bringing its total fleet to 84.

"That remains on course," Bartrem said.

Air Canada said on Tuesday it would lay off 2,000 employees and reduce its autumn and winter capacity by 7 percent to cope with sky-high oil prices, which are causing financial pain throughout the airline industry.

Oil prices this week flirted with $140 a barrel. U.S. light crude futures were down $1.24 at $133.37 a barrel in afternoon trading on Tuesday.

WestJet has slapped fuel surcharges on its fares along with Air Canada. The company can still reduce or cancel them if fuel prices drop, he said.

"On the other side, if we're seeing sustained prices at the $150 or $200 mark, we'd have to review it again at that time to see if we would need to increase it," Bartrem said.

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