Low-cost carrier NewLeaf to be based out of Winnipeg and hire 750 people

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This article was published 09/06/2015 (3866 days ago), so information in it may no longer be current.

Jim Young may be the answer to the Winnipeg Airports Authority’s prayers.

The CEO of NewLeaf Travel Company Inc. has launched a new “ultra-low-cost” airline carrier targeting the leisure traveller that will be based out of Winnipeg.

The plan is to hire 750 people, including pilots, flight attendants, executives as well as people performing finance, marketing, information technology and sales and distribution functions.

Locating a new corporate head office is a big deal for a city such as Winnipeg, but perhaps the biggest positive for the WAA is a large part of his target market is people who drive across the border to fly with Allegiant Air.

The WAA estimates 280,000 people in its catchment area flew out of Grand Forks and Fargo, N.D., Minneapolis or other cities rather than Winnipeg in 2014. Most were headed to sun destinations such as Phoenix, Las Vegas and Orlando, Fla.

“If I had a competitor, it would be the airlines that Canadians are driving across the border for,” Young said.

“I don’t look at WestJet and Air Canada as our competitors because we’re looking to create a new market and stimulate people who aren’t flying today. What I’m going after are people that will make the three-and-a-half-hour drive in the middle of winter to go to Grand Forks because they’ve got to get to some place warm or can’t afford to fly from here.”

Young said he’s not prepared to release NewLeaf’s routes or fares until the company is ready to start selling tickets. The plan, though, is to start flying domestic routes this summer to cities such as Hamilton, Ont., and Kelowna, B.C. It will also offer flights to U.S. sun destinations next winter, such as Orlando, Young said.

The goal of an “ultra-low-cost” airline is to eliminate or reduce as many expenses as possible. That means no meals, complimentary snacks or entertainment and likely walking or busing out to the plane on the tarmac. At its bare bones, you get a seat and a seatbelt.

Customers who request some of these or other services, such as a rental car or hotel room at their destination, will be able to get them through NewLeaf but there will be extra costs.

NewLeaf has partnered with Flair Airlines, a charter company based in Kelowna with a quintet of 737-400 aircraft, to fly its schedule. Young said he plans to lease more planes shortly after startup with a goal of having a fleet of 15 in a couple of years.

Barry Rempel, president and CEO of WAA, said NewLeaf’s arrangement with Flair follows a similar model Air Canada has with its “rouge” leisure travel banner.

“They have a partnership with somebody who already has an operating certificate with Transport Canada,” he said.

Rempel said it’s possible another ultra-low-cost carrier — Canada Jetlines in Vancouver — could enter the market in the not-too-distant future.

“They’re trying to find a way to launch themselves on the stock market with public money,” he said.

Mayor Brian Bowman said the addition of another head office in town is “huge.”

“We want to grow to a million people. We want economic engines for people who are coming out of our colleges and universities. We’ve got a wealth of highly skilled people that they can pull from here,” he said.

Greg Dandewich, senior vice-president of Economic Development Winnipeg, said even though NewLeaf is new to town, it can be used to help build the business community further.

“When we’re talking about opportunities to bring in investment, we talk about new investments that have happened to build the critical mass in specific areas, such as aerospace and air travel,” he said.

Young, who was recently based out of Denver as the chief marketing officer at Frontier Airlines, said NewLeaf is being financed by a group of private investors from across the country. Neither their names nor the amount of their investments is being made public.

Some of NewLeaf’s employees will be housed in the airport’s former car-rentals building, a 7,000-square-foot space that used to sit across from the now-demolished terminal building.

geoff.kirbyson@freepress.mb.ca