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WestJet is encouraged by early returns from Encore while working to deepen its fleet flexibility

Analysis

Roughly three months after the highly anticipated launch of its new regional subsidiary Encore, Canada's WestJet has concluded the carrier is performing beyond initial expectations. As Encore marches toward a fleet of seven Bombardier Q400 turboprops by YE2013, future deliveries are likely to be pegged for central Canada using Toronto as a base.

During the early days WestJet has not strayed from its stated strategy with Encore - connecting small Canadian markets that are too thin for Boeing 737 narrowbodies.

WestJet is also making moves to build fleet flexibility in the coming years to support a range of annual growth from one percent to seven percent. That should allay some recent concerns that WestJet is in danger of introducing too much capacity which may not be absorbed.

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