'I think WestJet was doing too many things, was 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,' said CEO Alexis von Hoensbroech
Alexis von Hoensbroech spent the first 10 and a half months as WestJet’s CEO laying the groundwork for change — 2023 will be about seeing his plan in action.
The new direction is more of a course correction, an attempt to take the Calgary-based airline back to its roots in a world emerging from two years of pandemic restrictions and lockdowns.
This means more centralization in Western Canada while looking for ways to make flying more affordable and improving the product.
“2023 will be the year where we do a lot of the implementation of the strategy,” he said. “If you look at an airport like Calgary, we will see more than 25 per cent growth from 2022 to ’23. So this is a lot of additional capacity and this will come with quite a few additional routes.”
He was considered a rising star with the Lufthansa Group, having previously served for three years as CEO of Austrian Airlines, that country’s largest airline pre-pandemic as a low-cost option with a large footprint in central and eastern Europe.
Returning to pre-pandemic levels
Challenges remain as the airline industry continues to recover from restrictions and health orders during two years of COVID-19. WestJet was the only major Canadian airline that did not take pandemic-related federal government assistance, but instead took on hundreds of millions of dollars in losses and debt.
“I think WestJet was doing too many things, was 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,” said von Hoensbroech.
For 2022, the airline is running at 78 per cent of pre-pandemic levels, with federal restrictions on flying and cross-border travel still in place until Oct. 1. In December, the airline is running at 90 per cent of pre-pandemic levels — averaging about 600 flights a day with 65,000 guests — and is forecasting a return to 2019 numbers by the second or third quarter of 2023.
This was before extreme weather wreaked havoc on the airline industry during the holiday season. Between Dec. 18 and Dec. 26, 1,450 flights were cancelled by WestJet due to winter storms across the country, affecting thousands of travellers. On Dec. 23 alone, 333 flights were grounded.
The first major announcement von Hoensbroech made after taking his post was to announce a takeover of vacation destination airline Sunwing, based out of Toronto. In October, the federal Competition Bureau raised concerns over the merger and the deal remains in the regulatory process with a final decision not expected until the new year.
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 as new airlines launch
Competition, particularly in Western Canada, has only increased for WestJet this year.
The competition has largely crowded the low-cost market that WestJet is targeting.
“In the end, I don’t really care what they do. What I care about is what we do, and we do what we have always been good at, which is being relentless on costs,” said von Hoensbroech, which he adds will lead to lower ticket prices.
New vision, routes announced
In June, the new CEO unveiled his vision for WestJet.
The airline cancelled all orders for 787 Dreamliners, leaving its wide-body fleet at seven, while announcing a focus on narrow-body aircraft. WestJet has since increased its 737 Max purchase order with Boeing from 23 to 65.
In making this pivot, WestJet has made Calgary International Airport its hub for Dreamliners, while relaunching routes to London, Paris and other European destinations.
The strategy also outlined a restructuring of regional service, particularly in Western Canada with its fleet of De Haviland Dash 8s.
Environmental sustainability a point of focus
“Sustainability and emission reduction is one of the biggest challenges that our society is facing, and we as an aviation industry have to do our part to help to support that,” said the CEO.
It has not been all victories for WestJet in 2022.
A cooling issue with the company’s servers caused a system-wide outage in November, which led to the cancellation of hundreds of flights and leaving thousands of passengers stranded.
Von Hoensbroech called it an expensive lesson and said they have “doubled-down” on targeting deficiencies in the IT system to prevent a similar situation.
“That’s what we owe to our guests,” he said. “When it comes to the resilience of our internal setup like our IT system, it is our responsibility toward our guests that we fix this — and we are fixing this.”
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