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Flight prices in Canada down 23% on routes served by low-cost carrier NewLeaf

Click to play video 'New low-cost airlines making a mark in Canadian air travel' New low-cost airlines making a mark in Canadian air travel
Are new low-cost airlines charting a new course towards cheaper fares in Canada? As Reid Fiest reports, the entry of NewLeaf Travel is showing some fares are decreasing – Nov 22, 2016

NewLeaf Travel has already flown 1,000 flights since taking to the sky with Flair Air in July, transporting some 100,000 passengers, and Global News wanted to find out if the company is having any impact on Canada’s pricey domestic fares.

The travel app Hopper crunched some numbers and found that on routes NewLeaf flies, fares are down about 23 per cent across all airlines.

Hopper’s Patrick Surry found even the thought of a competitor caused players like WestJet and Air Canada to flinch, dropping rates.

“Certainly it’s a good time for these innovative business practices to be coming in and people to be trying different things and figuring out some ways to serve Canadians better.”

Boarding a flight from Halifax, N.S. to Hamilton, Ont. Izabella Drogosiewicz said NewLeaf Travel is shaking up the airline scene in Canada.

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“Well it’s easy on the pocket book, to slash the price in half, why not?”

Jason Cernic agreed:

“I booked my flight yesterday, it was $200 return.”

He said the same flight would typically cost him $600 to $700.

Watch below: Global’s past coverage of NewLeaf Travel flights

However, NewLeaf’s flights haven’t been without some turbulence.

It dropped flights in Regina, Saskatoon and Victoria this fall, but may bring them back if demand rebounds.

READ MORE: NewLeaf temporarily suspends flights out of Regina and Saskatoon

The company – with just three full-time aircraft – is also facing increased competition from competitors, not only on fares, but routes only NewLeaf flies, according to company president Jim Young.

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“I think first of all, competition is good for Canada, and it’s good for the Canadian consumers,” Young told Global News.

“We've brought meaningful competition to the marketplace.”

Calgary-based WestJet says it already is—and will continue to give—its customers options at lower costs in response.

“As more airlines come in, competition, absolutely is a good thing,” WestJet’s Richard Bartrem said.

“But we will defend our position as Canada’s low-fare leader.”

READ MORE: When is the best time to buy a plane ticket?

Skies are expected to be even more crowded with Calgary-based Enerjet aiming to be in the air within six months.

The government of Canada recently announced changes to ownership rules, allowing up to 49 per cent to be money from foreign investors.

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Enerjet’s Darcy Morgan says the company has been courting an American investor, with experience funding successful U.S. low-cost carriers.

“These people know about the best practices for operating a low-cost airline and they can help bring those best practices to us,” Morgan said.

READ MORE: Will new foreign ownership rules make flights in Canada cheaper?

Canada Jetlines Inc. is another entrant looking outside the country for investors.

The hope is all three may bring the competition needed to finally bring down the cost of domestic travel.