While some airlines are currently riding the travel demand high that has been going steady since the post-pandemic reopening, others have struggled to stay afloat amid pressures ranging from high jet fuel costs and aircraft supply problems to a limited customer base for regional airlines.
In 2024, Air Malta, Armenia’s FlyArna, Canada’s Lynx Air and Antigua and Barbuda’s LIAT have all either filed for bankruptcy protection or shut down operations entirely. The small South Pacific nation’s only main airline, Air Vanuatu, left many tourists and some locals going to nearby countries like Australia completely stranded when it suddenly canceled all its flights back in May.
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Based out of Ontario’s Mississauga, Canada Jetlines went through a long process of raising funds and getting approved by the Canadian government (the country’s laws previously required Canadian airlines to have no more than 25% foreign investment) before taking its inaugural flight in September 2022.
‘Company has been unable to obtain the financing required to continue operations’
But the airline designed to shuttle Canadians to vacation destinations in the U.S. and the Caribbean did not last long. On Aug. 15, Canada Jetlines announced that it was ceasing all operations after struggling to find enough capital to keep running — prior to this step, it had unsuccessfully tried solutions such as additional debt, strategic transactions, equity and debt financing.
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While the airline is positioning the shutdown as temporary, nothing short of a last-minute takeover by an investor or other drastic change could alter the situation. The shutdown also follows the resignation of four executives including CEO Brigitte Goersch. In the statement, the airline said that it plans to file for creditor protection to eventually restart operations.
“The company pursued all available financing alternatives including strategic transactions and equity and debt financings,” representative Erica Dymond in a press release. “Unfortunately despite these efforts, the company has been unable to obtain the financing required to continue operations at this time.”
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Affected by a canceled Canada Jetlines flight? Here is what the airline says you should do
While the representatives also said that it was taking “every effort” to “assist passengers at this time,” the solution it provided is to contact one’s credit card company for canceled flights — in other words, the airline simply lacks the funds to offer refunds itself. Some of the affected flights include routes between Toronto and Jamaica’s Montego Bay, Mexico’s Cancun and Florida’s Orlando.
Fellow low-cost Canadian airline Lynx Air also announced that it was filing for bankruptcy protection in February 2024 over similar problems around high operating and fuel costs as well as increased competition from the country’s main two airlines: Air Canada (ACDVF) and WestJet Airlines.
The 38.9 million Canadians currently living in the country also frequently use U.S.-based airlines such as United Airlines (UAL) and Delta (DAL) (or flights through their networks) to fly to places like Florida.
“Every time a new player wants to enter the market, there’s only one certainty: they’re going to be losing money for the first eight, nine, 10 months at least and perhaps even more,” Jacques Roy, a professor of transport management at HEC Montreal business school, told local outlet Global News. “So you need a good bank account.”
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