Canada’s airlines Part 1: WestJet continues its ambitious diversification strategy in 2014

Canada's second largest carrier WestJet is continuing to outline bold ambitions for 2014 after launching its regional subsidiary Encore in 2013, along with a new premium economy product and fare bundles designed to appeal to leisure and corporate customers alike.

So far WestJet has made nothing but positive declarations about Encore's performance, which is the expected response from the early days of a new undertaking. But 2014 is the year when the industry is watching for meaningful trends to indicate whether Encore will deliver on WestJet's expectations, which likely include obtaining a nice chunk of the USD2 billion value the carrier estimates that Canadian regional domestic and short-haul transborder operations fetch.

WestJet shows no signs of slowing down in 2014 as it marks the milestone of introducing its first long-haul international operation when new service to Dublin commences in Jun-2014. It has reportedly outlined encouraging booking trends on the new flights, and indicated more trans-Atlantic service may be in the offing. It is inevitable WestJet would set its sights on international service beyond transborder services, given the revenue potential and the opportunity to challenge Air Canada's leading status in the international long-haul market.

Its sometime lookalike in the comparable Australian market, Virgin Blue/Virgin Australia, has undergone a complete transformation from LCC to full service airline so as to address this market segment. WestJet is taking a more cautious approach.