NewLeaf Travel Company CEO Update
Transcript
Jim Young:Well, we formed NewLeaf about a year and a half ago to bring ultra low cost fares to Canada in a manner that, you know, similar to other countries around the world. 5.2 million Canadians cross the border actually every year to fly on Spirit and Allegiant and a few others. So we thought it was time to bring that same environment to the domestic Canadian market. So NewLeaf was formed to do just that, and we've taken a different approach to our business model. Other than starting an aircraft or an airline from a clean sheet of paper, we've decided to use the more— I guess the term might be virtual or indirect service route. NewLeaf is the first massive or scaled application of an indirect service provider model in Canada. Well, we were awaiting our review from the CTA, the Canadian Transportation Agency, which we received about 2 weeks ago, and we're thrilled with the result, and we're now looking to relaunch for summer service. As a result, when we were selling, bookings exceeded our expectations, and we were planning— we know that there's demand out in the marketplace for Actually, the opposite occurred. We traded— when we refunded our customers their money, we traded them their money for a pitchfork and told them to get out and react to the marketplace and demand lower fares come to Canada. We're the only G20 country in the world that doesn't have an ultra low cost carrier model, and as a result, Canadians pay far too much for travel today due to the natural duopoly that exists between between the current incumbents. So our Facebook users, our social media channels, all reactions actually increased between the time we had to suspend sales to today. So it's actually had an opposite effect. Actually, it only supports our product because in economic weakness, people start to make trade-offs. If a $500 airfare is too expensive, they don't go, but they might still go for a $100 or $200 airfare. So as a result, this model is actually quite timely to any kind of economic downturn.
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