Canada’s competition regulator investigates ‘predatory pricing’ by Swoop
A heated battle is brewing between Canada’s two newest low cost carriers.
Flair Airlines cried foul over Swoop’s ‘predatory pricing,’ characterizing it as a ‘David and Goliath’ fight for passengers.
After complaints by Flair, Canada’s competition watchdog has opened an investigation.
Flair Airlines chief executive Jim Scott said WestJet backed Swoop is trying to force Flair out of several markets including Saskatoon and Thunder Bay by offering tickets below cost with the sole aim of crowding it out.
Flair filed a complaint in October and now the Federal Court of Canada’s chief justice has ordered a WestJet executive to appear before the competition regulator.
"Whenever we go into a market, WestJet or Swoop will go into the same market with a lot of inventory (at) low-cost," Scott said in an interview.
"We’re here trying to provide a service to Canadians, and the entrenched incumbent is basically trying to keep a new player out of the marketplace. If the Canadian government didn’t step in in such a timely manner, it would have been very difficult for us to continue."
The Federal Court has ordered the airlines to share detailed pricing information and other relevant documents.
According to a court document interim competition commissioner Matthew Boswell said he ‘has reason to believe that the parties have engaged in a conduct that constitutes an abuse of dominant position.’
WestJet and Swoop are ‘engaging in predatory anti-competitive practices, more specifically predatory pricing, by significantly decreasing the prices of their passenger tickets to a level that appears to be below their avoidable costs,’ he added.
The allegation centers on three Edmonton routes which WestJet and Swoop ‘substantially or completely control’ the commissioner said.
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Editor for TravelMole North America and Asia pacific regions. Ray is a highly experienced (15+ years) skilled journalist and editor predominantly in travel, hospitality and lifestyle working with a huge number of major market-leading brands. He has also cover in-depth news, interviews and features in general business, finance, tech and geopolitical issues for a select few major news outlets and publishers.
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