Struggling Canada Jetlines Stops Operations, Filed For Creditor Protection.

• Another Canadian budget airliner Canada Jetlines has gone down in flames, seeking creditor protection.
• Carrier becomes the latest low cost carrier after Alberta-based Lynx and Swoop to close in the past year.
• In January 2023, Canada Jetlines pressed pause on domestic routes as the carrier refocused on sun destinations and leasing its planes.
• The shutdown also underscores the challenges of running an airline in big country with a diffuse population and only a few key air travel hubs.

Canada Jetlines, a value-focused leisure carrier, is grounding all flights and says it is temporarily ceasing airline operations, effective immediately. The company specialized in domestic flights within Canada and sun destinations in the US, Caribbean and Mexico.

The company was formed in 2013 and held its inaugural flight from Toronto Pearson to Calgary on September 22, 2022, although most domestic flights were halted in January 2023.

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The airline says it has been unable to find the financing needed to keep flying and plans to file for creditor protection.

On its website it advised passengers with existing bookings to contact their credit card companies to secure refunds. Spokeswoman Erica Dymond said in a release,

“The company … pursued all available financing alternatives including strategic transactions and equity and debt financings.

"Unfortunately despite these efforts, the company has been unable to obtain the financing required to continue operations at this time.”

The shutdown follows the resignation of four board members on Monday, including chairwoman and CEO Brigitte Goersch.

It marks yet another airline departure from Canadian skies after the closure of Lynx Air and budget carrier Swoop within the past year as concerns about domestic competition persist.

The airline, which operated a small fleet of Airbus A320s, had recently launched new routes and entered an agreement with Air Arabia Maroc.

During last week, the company was flying a few dozen flights per month from Toronto to Miami and Orlando, Fla., and Cancun, Mexico.

Shares of the Mississauga-based company on the NEO Exchange were halted late Wednesday afternoon.

Canada Jetlines, which has struggled to get more than a couple of planes off the ground since its inaugural flight in September 2022, faced a series of setbacks even before the operation shut down.

On June 30, Eddy Doyle stepped down as CEO after taking on the role in 2021, while in an August 12 press release, the airline said continuing operations were dependent upon its ability to raise adequate financing.

In January 2023, Canada Jetlines closed its domestic routes as the carrier refocused on sun destinations and leasing its planes, but said at the time it aimed to resume in-country flights that fall.

In October 2019, the carrier announced it was postponing its planned December launch and laying off most employees after failing to secure the required financing and losing investment partners.

That setback came after seven years of fundraising and despite Ottawa lifting the foreign ownership ceiling on Canadian airlines to 49 per cent from 25 per cent in 2018, allowing for a wider pool of investors.

Canada Jetlines lost $14.2 million over the 12 months between March 2023 and last March, despite eking out a profit in one of the quarters, according to financial filings.

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