Canadian travellers should prepare for lift-off as airlines begin to pile on new fees for their services. Starting Jan. 5, Westjet and Air Canada will be implementing several new fees that travellers will be required to pay; some of which include extra bagging check fees and fuel charges.

While frowned upon by the general public, the decision to increase flight fees is an excellent choice from a business standpoint. The decision will undoubtedly only increase Air Canada’s profits. The fact that Air Canada has virtually no competition and provides an essential service to the economy makes this a smart move on the company’s part, as Canadian consumers still have no alternatives for international flight. Not only is this market almost entirely dominated by Air Canada,  entry into the market is extremely difficult. Consumers have virtually no option available to them other than express their dissatisfaction with the hike in fees.

Air Canada’s assertion of their market dominance is also done in a way that doesn’t cause a massive uproar; unlike the man who recently raised the price of an HIV drug by fifty times its original price. This tactic would minimize the amount of backlash it would receive if it had piled on all its plans for fee increases at once.

Sources:

Canadian travellers face extra passenger fees from some airlines in New Year

http://www.cbc.ca/news/business/air-canada-ceo-says-extra-baggage-fees-fuel-charges-essential-to-airline-profit-1.2983611

http://www.cbc.ca/news/business/airlines-pile-on-new-fees-and-even-more-charges-lie-ahead-experts-say-1.3323044