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With oil prices continuing to surge due to the conflict in the Middle East, some flyers departing from Regina may see additional charges added to their ticket purchases.
Some Canadian airlines, including Air Canada and WestJet, have announced plans to begin adding fuel surcharges to certain bookings due to the rising cost of aviation fuel.
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James Bogusz, the CEO of the Regina Airport Authority, joined The Greg Morgan Morning Show on Wednesday to explain what the surcharges will mean for travellers.
Listen to the full interview with Bogusz, or read the transcript below:
The following transcript has been edited for length and clarity.
GREG MORGAN: I know airlines are having to deal with some serious fuel charges from this war in the Middle East, just as we are when filling up our own tanks. But today, we’re starting to see WestJet and even Air Canada hit customers with surcharges to cover their costs. I know WestJet has a $60 surcharge on some bookings. Air Canada’s charging $50 on some. James, do you have any feeling about how long this surcharge era might last, even if relief from the Middle East comes sooner rather than later?
JAMES BOGUSZ: I saw WestJet announce on companion fares they’re adding a surcharge, and understand Air Canada’s doing this to its Sun destinations. You know, Greg, I’m an old guy. I’ve been around a while. I remember when this was happening back in 2008, when the oil was very high, and even into 2012, 2013, 2014. It really depends. If it’s sustained, Greg, we can expect higher fares, whether they be through surcharges, baggage fees, or just higher base fares. So let’s hope we can see a drop in this price, because it’s very impactful for airlines.
Do you think they’ll actually disappear? Do they actually back off on the surcharges if fuel prices go down?
BOGUSZ: Well, total cost of travels that people care about, regardless of base-fare fuel surcharges, it’s very dynamic. So if their costs go down, generally ticket prices follow. But it’s going to take a bit of time. These prices are very high, and it’s, again, very impactful.
WestJet is even adjusting and condensing some flights in some centres. I see they did that in Edmonton. Have any adjustments been made to Regina’s flights yet? Or could that happen?
BOGUSZ: Could it happen? Absolutely. We’ve seen only small adjustments to their schedule, which is very typical this time of year. I saw that news out of Edmonton, and I’m expecting we’re going to see some further consolidations, especially in the next 30 days. I had a chance to chat with WestJet in the last week and a half, and they signalled that. They said very clearly they’re going to have to look at tweaking some of their scheduled routes. This could even impact flights to Calgary, possibly Edmonton as well, just in terms of maybe frequency per day, but small adjustments, they suggested. Nothing major with all of this.
James, have you noticed traffic at the Regina airport affected by any of this uncertainty?
BOGUSZ: We’re going to have our data coming up fairly soon. I’m really anxious to see April and May, primarily. We had our (Air Canada) Sun schedule already baked in, but we’re expecting an incredible summer, Greg, with capacity. I just hope these fuel prices don’t dampen those expectations. In fact, we’re expecting near-record airline capacity this year at the Regina airport. But then I look at fuel prices and I think, “Is this sustainable if the demand starts dropping due to this cost?”
What’s got you excited about this summer?
BOGUSZ: One of the major data points I look at, as an airport, is the available seats in our market. This is what you and I have to purchase on major airlines like Air Canada, WestJet and even United. I’m able to look at that data a few months ahead, and I had a chance to review that data recently. This summer, at the moment, what we have available for sale in Regina is going to be around 2018’s seat capacity – available seats for sale. It’s great news for the city. However, I look at fuel prices and I think to myself, “Is that schedule going to be maintained? Are we going to see those airlines maintain what they’re forecasting right now?” I’ll be watching that very closely.
These direct flights to Halifax. We were getting more this summer. Might they be affected?
BOGUSZ: Well, WestJet’s not signalled a change as of yet, but as you know, Greg, this is a very dynamic industry. We’re hopeful to continue to see that twice-a-week service begin in the summer, but WestJet, Air Canada, these airlines are always going to respond to market changes, including demand. So if demand drops, then they’ll certainly start bringing the flights back down. If demand maintains, they’re going to continue those flights. So it’s too early to say yet, other than to say we’re going to be watching this very closely.
You’re doing a few upgrades around the airport. What’s going on?
BOGUSZ: Passengers are going to notice hoarding up in the next couple of weeks on the second floor. We call it a modest renovation, but near gates six, seven and eight, so the area where the larger planes depart, and certainly during the sun season – which we wanted to wait to end before we started the renovation – we’re gonna have a lot more room for passengers, for seating, we’re going to put some fresh carpet down, we’re going to spruce the place up a little bit. But the main thing we’re going to have is more room for customers on those bigger planes near the 306 Bistro + Bar. We’re super excited to get this thing fired up.
