WestJet to complete fare bundling roll-out in Q2

Washington DC
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WestJet has not yet completed its premium economy reconfiguration project by the end of the first quarter as it had hoped, the carrier says.

However, it says the timing will match up with the technology roll-out of its new three-tiered fare structure in the first half of this year, which is required to sell the seats to customers.

"The timing will likely work well regardless," says WestJet.

The Calgary-based carrier has rolled out the bundled fares on its website, but completion of at least one more phase of the rollout will be required before the project is complete and the premium seats can be sold. The full roll-out is expected to be finished "sometime in the next month or two", says the carrier. The first phase involves rolling out the software, making adjustments to inventory and display changes.

WestJet is expecting the new fare bundling strategy to drive incremental revenues of Canadian dollar (C$) 50 million to $80 million annually, the carrier disclosed in a regulatory filing.

The three-tiered bundling strategy gives customers varying levels of flexibility for changing fares and different levels of amenities. The no-frills "econo" fare is the least expensive, followed by the mid-level "flex" fare. At the top of the three-tiered model is the "plus" fare with maximum flexibility, targeted at business travellers. The multi-million dollar seat project involved installing four rows of extra leg room on the Boeing 737s with a 36in pitch and putting an additional eight seats on the Boeing 737-800s. The pitch was decreased in the standard economy section to 31 or 32in from 34in.

WestJet began the seat reconfiguration project in August 2012. The timeline for extending the installations was previously extended from the end of 2012 to the beginning of 2013 due to a delay in gaining regulatory approvals.