WestJet said Friday it aims to wind down Sunwing Airlines and integrate the low-cost carrier into its mainline business by October of next year.
WestJet, which bought the Toronto-based company’s main airline and vacation divisions in May in a major consolidation of the aviation market, saidSunwing’s 18 Boeing 737s and 2,000 employees will be folded into the Calgary-based carrier in a “seamless transition.”
WestJet and Sunwing together make up 37 per cent of seat capacity on direct flights to sun destinations, and 72 per cent from Western Canada, according to a report from the Competition Bureau last fall.
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Some experts have warned that the move could mean less service and higher fares, particularly in Western Canada and smaller cities across the country.
As a condition of Ottawa’s sign-off on the Sunwing acquisition, both parties pledged to maintain capacity on the most affected routes and keep the Sunwing Vacations head office in Toronto and a regional one in Montreal for at least five years.
The integration process is underway as WestJet prepares to bring budget subsidiary Swoop under its flagship banner by the end of next month after reaching a new collective agreement that put pilots at both segments onto a level field of pay.
WestJet has announced plans to merge with Sunwing Airlines by October 2024. The Calgary-based company acquired low-cost airline Sunwing on May 1, 2023. Here are the key details:
Integration Timeline: WestJet aims to fully integrate Sunwing Airlines into its operations by October 2024, the company said in a Sept 29, 2023 statement posted on its website.
Seamless Transition: The merger will involve incorporating Sunwing’s 18 Boeing 737s and approximately 2,000 employees into WestJet’s existing structure, with the goal of achieving a smooth transition.
Market Share: The combined market share of WestJet and Sunwing currently stands at 37% for direct flights to sun destinations and a significant 72% for flights departing from Western Canada, according to a report from the Competition Bureau.
Concerns: Some industry experts have expressed concerns about potential implications for travelers, including reduced service and higher fares, especially in Western Canada and smaller cities.
Government Oversight: To gain approval for the Sunwing acquisition, both companies have committed to maintaining capacity on routes most affected by the merger. They have also pledged to retain the Sunwing Vacations head office in Toronto and establish a regional office in Montreal for a minimum of five years.
Swoop Integration: In addition to the Sunwing merger, WestJet is in the process of integrating its budget subsidiary, Swoop, into its main operations. This integration has been facilitated by a recent collective agreement that equalized pilot pay for both segments.
Termination agreements for WestJet and Sunwing employees
As the two Canadian airlines merge over the next 12 months, it’s possible that some non-unionized workers could be fired or let go.
In Canada, non-unionized Sunwing and Westjet employees are entitled to full severance pay when they lose their jobs due to downsizing, merging, corporate restructuring, or the closure of the business.
This includes individuals working full-time, part-time, or hourly in Ontario, Alberta, and B.C.
Severance can be as much as 24 months’ pay, depending on a number of factors.