ANALYSIS: Toronto-Dublin competition set to heat up

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Competition is set to heat up the Toronto-Dublin route in the third quarter as two new low-fare players from each side of the Atlantic enter the market—Aer Lingus and WestJet.


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Air Canada and Montreal-based leisure carrier Air Transat dominated the route last year, but data from Capstats show that the doubling of carriers flying the route will boost capacity by 87.2% in July, when the number of available seat kilometres (ASKs) will start to peak.

In April, Aer Lingus will begin non-stop flights between Dublin and Toronto seven times per week with a Boeing 757 aircraft.

WestJet will also start daily service to Dublin on 15 June, however it will be using a 136-seat Boeing 737-700. The seasonal flights will run until 5 October.

The aircraft on the route will start in Toronto, stop in St. John’s and then head to Dublin. Connecting flights from several other Canadian cities, including Calgary, Ottawa, Vancouver and Winnipeg, will also feed traffic into St. John's for the Dublin flights. The airline has filled upwards of 70% of bookings on the new route so far, WestJet's chief financial officer Vito Culmone told investors on 10 March during the J.P. Morgan Aviation, Transportation and Industrials Conference in New York.

Air Canada will continue to operate Boeing 767-300ER aircraft daily on the Toronto-Dublin route, however this year it will do so under its new, lower cost subsidiary Rouge.

Air Transat will fly Airbus A310 and A330 family aircraft on the routes, Capstats shows. Schedules on Air Transat's website show that the carrier provides 18 flights in July four days per week, with a small number stopping in Montreal. The carrier has offered this scheduled seasonal service between April and October since 1994.

The new competition on the Dublin route will mean lower fares, says National Bank Financial analyst Cameron Doerksen in a 4 March research note.

The firm’s research shows that a survey of return fares between Toronto and Dublin in July have dropped from between C$1,000 and C$1,099 per ticket on Air Canada Rouge, Aer Lingus and Air Transat flights to between $896 and $950. WestJet’s fares for its connecting flight showed the only increase from C$906 to C$1,221. The survey compares fare prices calculated in December and March.

“Our survey of fares on the Dublin market clearly shows that the additional capacity is putting downward pressure on prices as fares from virtually all the competing carriers are down materially from our first survey in December,” says Doerksen. “Only WestJet’s fares have increased as the fares it offered in December were very low introductory fares related to the launch of the new route.”


July 2014 one-way capacity from Toronto to Dublin

DateCodeCarrier NameSeatsDeparturesAvg. CapacityASKs

2014

AC

Air Canada

6479

31

209

34.1 million

2014

TS

Air Transat

4876

18

276

25.7 million

2014

EI

Aer Lingus

4898

31

158

25.8 million

2014

WS

WestJet*

4216

31

136

22.2 million

TOTAL:20,469111107.8 million

*WestJet flights stop in St. John's, Newfoundland


July 2013 one-way capacity from Toronto to Dublin

DateCodeCarrier NameSeatsDeparturesAvg. CapacityASKs

2013

AC

Air Canada

6264

29

216

33 million

2013

TS

Air Transat

4683

17

275

24.6 million

TOTAL:109474657.6 million

Story updated with additional information on Transat's Dublin route.