Canadian low-cost carrier FLAIR is in trouble as the airline just had four aircraft seized by a creditor following late payments of the plane’s leasing rates.
The creditor, a New York-based aircraft leasing company, sprung into action to repossess the planes, which has now resulted in many cancellations as Flair no longer has access to them for flight rosters.
FLAIR Airlines has built quite a network in Canada and beyond, mainly operating out of Edmonton. Last Saturday, dated March 11, 2023, Airborne Capital Ltd. seized four aircraft operated by Flair over non-payment.
Flair’s CEO Stephen Jones has admitted in statements to the media that the airline owed around US$1 million on the leases.
CTV had a report and also a Youtube Video about this:
CBC reported that the four aircraft were seized after the airline fell behind their payment for a few days.
Flair Airlines says passengers were impacted after four of its leased aircraft were seized in Toronto, Edmonton and Waterloo, Ont., in what the company is calling a commercial dispute.
Flair issued a statement on Saturday calling the move by a New York-based hedge fund to take the aircraft “extreme and unusual.”
It says Flair will use additional fleet capacity to lessen the effects on passengers and it does not foresee any major disruptions to its route map.
A person familiar with the matter but who was not authorized to speak publicly about it said the payments for the affected planes were only a few days behind, and that it was a small amount relative to Flair’s overall revenue.
Company spokesperson Mike Arnot says a number of Flair flights were cancelled Saturday morning, but the company has three spare aircraft to backfill those flights.
Arnot says passengers travelling in the next 72 hours will either be accommodated on Flair flights or another airline at Flair’s expense if a Flair flight isn’t available. …
A Toronto family arrived at Pearson airport destined for Disneyland in California when they learned their flight had been cancelled.
“We called the customer service line and they said that the flight had been cancelled due to mechanical issues,” Pomeroy said, adding they were offered hotel and food vouchers but never received them.
She said Flair rebooked their flights for next week but they found the new departure date “super not helpful for us on our March break vacation” and decided to buy tickets from another airline for a flight that leaves tomorrow morning.
Pomeroy said she only learned of the Flair plane seizures from a friend who sent her a link to a news article in response to Pomeroy posting about her flight cancellation on social media. …
I’m not surprised that passengers encountered bad customer service from this airline. FLAIR is plain horrible, with lots of delays and cancellations.
When a friend recently encountered a five-hour delay from Vancouver to Ottawa, the first thing they mentioned in the delay notification was that the government-mandated compensation scheme doesn’t apply, making some invalid excuse.
I’m not surprised that the company acted quickly to take their planes back. I have previously read that they already told FLAIR that the company wouldn’t extend the lease agreement, and the airline being late on their payments, owing more than one million dollars, was probably the last straw.
This is how FLAIR described itself on the company profile:
Flair Airlines is Canada’s leading independent ultra-low-cost carrier (ULCC) and is trailblazing with an ambitious, rapid expansion to disrupt the monopolistic practices of Canadian airlines. At Flair, we believe in air travel for all. Canadians have paid far too much for far too long. We will not waver or compromise. Flair is here to stay and will continue to make travel more accessible, more affordable, more exciting – to everyone.
We take our obligation to our staff and customers seriously and maintain an impeccable safety and reliability record. Our incredible track-record will never come at a cost to the consumer and our fares will always remain affordable while providing safe and reliable air travel.
Flair is growing our fleet, route network, and frequency of flights in record time. There’s nothing stopping us now. We are the pioneers of ultra-low fare travel in Canada, and since our launch in 2017, we’ve brought affordable travel to over 35 Canadian and North American destinations.
The airline was founded in 2005 and received a complete rebranding in 2019 before the pandemic. Large orders (relative to the carrier’s size) for Boeing 737-800 single-aisle aircraft were placed in an effort to grow. But has the carrier taken on more than they can chew?
There was also controversy in the past surrounding the airline’s ownership, and the carrier was in danger of maintaining its operator certificate as Canadian law requires the airline needs to be controlled by Canadians, not foreigners. A restructuring of the ownership and board was required to be compliant with the law eventually.
Canadian Low-Cost Carrier FLAIR just lost four aircraft as a leasing company from New York ceased the planes at several different airports in Canada. The airline was already several days late on paying roughly one million dollars.
The loss of these aircraft will put a strain on Flair’s schedule even though the airline tries to downplay the issue, saying they have spare aircraft. No airline, especially not a low-cost carrier, has empty planes sitting around permanently unused as “spares”. They are used while other aircraft are undergoing maintenance, but eventually, these planes are needed constantly to ensure a smooth operation.
If you’re scheduled to fly FLAIR in the coming days, weeks, and months better have a close eye on the reservation and departure times. If the carrier again tries to tell you that compensation rules don’t apply, then open a complaint with the CTA. Having no aircraft to operate flights they sold isn’t force majeure.