A new report says fares on summer flights to Canadian cities have shot up over the past year. People make their way through Pearson Airport in Mississauga, Ont. on Tuesday, March 14, 2023. THE CANADIAN PRESS/Chris Young
Planning a flight this summer? Expect higher costs.
A recent report reveals that travelers are paying significantly more for domestic flights in Canada during the peak tourism season compared to last year. Limited flight capacity and reduced competition are driving ticket prices up, even as demand eases.
According to the Flight Centre Travel Group, prices for domestic flights from July to September have risen by an average of 14% over the past year.
"We're seeing definite increases in cost across the board," said Chris Lynes, managing director of the travel agency's Canadian operations.
After the initial surge in leisure travel following the COVID-19 pandemic began to decline, Lynes expected slight price decreases. However, stagnant seat capacity and reduced competition have instead led to higher fares, particularly on short-haul routes.
For instance, one-way flights from Calgary to Vancouver have increased by 27% to $580. Montreal-to-Toronto routes have seen a 36% price hike to $781. Tickets for Edmonton-to-Vancouver flights have skyrocketed by 82%, reaching $737.
"The seat capacity has either stayed the same or reduced. So when you have less capacity and fewer seats, you're always going to see prices increase," Lynes explained.
Several Canadian airlines have faced plane delivery delays due to production issues at Boeing Co., limiting their ability to expand fleets.
Over the past 13 months, the airline industry has also seen more consolidation, with discount carriers Lynx Air and Swoop exiting the market and WestJet acquiring Sunwing Airlines. These changes have prompted a Competition Bureau study launched last month.
"When Lynx goes out of business or you see a consolidation with WestJet and Sunwing, it's inevitable you're going to see a cost increase," Lynes said.
However, Porter Airlines is expanding its fleet by adding two planes per month, which introduces some competition into the market.
Business travel has also started to recover after a prolonged post-pandemic delay, contributing to the higher fares.
"If you're in business class, they are still quite pricey," Lynes added.
