An airliner cuts through the skies over Montreal, Wednesday, Dec. 23, 2020. An aviation expert says the seizure of four Flair Airlines planes over the weekend points to the fierce competition and high demand playing out in the Canadian air travel industry. THE CANADIAN PRESS/Paul Chiasson
MONTREAL – An aviation expert says the seizure of four Flair Airlines planes over the weekend points to the fierce competition and high demand playing out in the Canadian air travel industry.
Flair says the Boeing 737 Maxes were grounded Saturday after a “commercial dispute” with New York-based Airborne Capital Inc., and that the airline has since begun lease payments that were several days overdue.
John Gradek, head of McGill University’s aviation management program, says leasing prices have skyrocketed since the pandemic due to surging travel demand, even as domestic airfares have dropped amid a crop of new carriers.
As a result, the “slightest sneeze” in a payment plan could trigger lease termination, allowing the lessor to find a new client willing to pay more per month for the pricey planes.
Gradek says 737 Max 8s can now cost lessees up to $450,000 per month, and a delayed payment may tarnish Flair’s credit and reputation, making future leases even costlier.
The sudden seizure of more than one-fifth of its fleet saw Flair scramble to roll out other planes over the weekend, as passengers in Toronto, Edmonton and Waterloo, Ont., dealt with last-minute flight cancellations.
This report by The Canadian Press was first published March 13, 2023.
