WestJet announces new low-cost fare option but you'll have to travel very light

Air travel is starting to feel more and more like building a Chipotle bowl: If you want the good stuff, it’s going to cost you.

What happened: WestJet is the latest airline to lean into unbundling airfares, a pricing model that keeps base fares low for budget customers but offers customizable (and pricey) add-ons, like seat selection, checked bags, and meals for those looking to pay a li’l more.

• This week, it announced a new low-cost fare category that doesn’t include a carry-on bag, for light packers. Last month, it rolled out a pricier “extended comfort” option.
• Airlines now rely on add-on fees to drive revenue as travel trends fluctuate and competition increases. Last year, global revenue from these fees hit US$117.9 billion.

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Why it matters: Unlike Europe or the US, Canada doesn’t have a bunch of ultra-low-cost airlines offering discount flights. Stripped-down fares at airlines like WestJet could remove a cost barrier for many of the cash-strapped Canadians who are having to cut back on travel.

• According to a Deloitte survey, 74% of Canadians say they won’t go abroad this summer in an effort to save money, while 35% say they can’t afford to travel at all.

Zoom out: WestJet is currently petitioning Ottawa to reduce some of the fees that it says drive up its own ticket prices, including government taxes and airport fees. The airline’s CEO claims that the change would allow carriers to offer customers even lower fares.

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