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(Jeff Vinnick)
(Jeff Vinnick)

WestJet shopping for global partners Add to ...

WestJet is keen to sign co-operation pacts with five foreign carriers over the next 18 months, whittling down a long list of suitors to help combat Air Canada and its global partners.

WestJet will first target "interline" agreements that call for co-operation on ticketing and baggage handling, making it easier for a traveller on an inbound trip into Canada to catch a connecting, domestic flight operated by WestJet.

Foreign airlines on WestJet's radar include members of the Oneworld and SkyTeam alliances. On WestJet's list of prospective partners are British Airways PLC, Japan Airlines Corp. and Mexicana, which belong to Oneworld, industry observers say. This week, Mexicana marked the second anniversary of its service on the Mexico City-Calgary route.

Calgary-based WestJet is also examining SkyTeam members such as Atlanta-based Delta Air Lines Inc. and Korean Air, as well as China Eastern Airlines, which will join SkyTeam next year. Another possibility is Emirates Airline, an independent carrier that has been feuding with Air Canada over the Dubai-based carrier's efforts to increase its Canadian takeoffs and landings.

Air Canada belongs to the Star Alliance of global carriers, which includes Deutsche Lufthansa AG, Continental Airlines Corp., United Airlines Inc., US Airways Group Inc. and Singapore Airlines Ltd.

Hugh Dunleavy, WestJet's executive vice-president of strategy, said during an investment webcast this week that roughly 70 international carriers have emerged as suitors, emphasizing that WestJet will select individual carriers instead of joining Oneworld or SkyTeam.

In an interview Thursday, WestJet spokesman Robert Palmer said that with dozens of foreign airlines interested in linking up with WestJet, there are still several "courtship" stages to go through before announcing the successful foreign partners.

"We're not going to give any specifics on who we may or may not be talking to, with respect to commercial relationships," Mr. Palmer said.

Last month, WestJet started an inbound interline agreement with Hong Kong-based Cathay Pacific Airways Ltd., and also has similar pacts in place with Air France-KLM and China Airlines. But WestJet's partnership plans with Dallas-based Southwest Airlines Co. fell apart in April.

With Air France-KLM, WestJet would like to eventually ink a "code-sharing" pact to allow for even closer co-operation on connecting flights, baggage handling and electronic ticketing. The goal is to take interline deals and gradually expand their scope, notably by introducing inbound code-sharing and then graduating to outbound code-sharing, where one carrier would have the ability to issue tickets on the behalf of the other airline.

New interline and code-share agreements are attractive to WestJet because it stands to boost the number of connecting passengers on its planes. On Thursday, WestJet reported that its load factor, or the proportion of seats filled by paying customers, rose to 77.7 per cent in May, compared with 74.1 per cent in the same month last year. Its traffic climbed 18.9 per cent to 1.26 billion revenue passenger miles while capacity grew 13.4 per cent to 1.63 billion available seat miles.

Air Canada's May load factor increased to 82 per cent from 79.5 per cent a year earlier. Its traffic jumped 9.7 per cent to 4.24 billion revenue passenger miles while capacity rose 6.4 per cent to 5.17 billion available seat miles.

WestJet reported that it recently held a 22-per-cent market share of the key Mexico/Caribbean region from Canada, trailing Air Canada's 41-per-cent share, but WestJet expects to narrow the gap as it expands its vacations division.

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