FuelClub Discount

A fuel surcharge by airlines on North American flights may rile customers, but observers say it was inevitable and may even help carrier earnings in the short run.

WestJet Airlines Ltd. and Porter Airlines slapped a fuel surcharge on all their flights yesterday as the price of oil continues near all-time highs. The move follows a similar levy by Air Canada last week. WestJet customers will now have to pay an additional $20 on short-haul flights, $30 for medium-haul and $45 for long-haul flights. Porter Airlines pegged its increase at $20 one way for the Ottawa-Toronto route, and $40 one way on all other routes.

“We’ve hung on as long as we could, as long as our low-cost structure allowed us, but we’ve now reached that point where we introduced that surcharge, at a level that we think is good for us,” WestJet spokesman Richard Bartram said yesterday.
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WestJet Airlines Ltd. is considering increasing its fares or adding a fuel surcharge to all tickets to combat soaring fuel prices.

Sean Durfy, the low-cost carrier’s president and chief executive, said WestJet has yet to put fuel charges on its tickets, and is instead trying to mitigate rapidly rising fuel prices by effectively managing costs, increasing utilization and raising fares where competitively possible.

In the first quarter, WestJet increased fares “probably three times,” Durfy told analysts in a conference call Tuesday. However, he said the true impact of fare increases don’t really offset the rise in fuel costs, which is the issue.
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