NewLeaf suspends ticket sales, offers refunds
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Turning over a new leaf in Canada's airline industry is proving to be more difficult than planned for a Winnipeg-based low-cost air travel company.
Less than two weeks after discount travel company NewLeaf Travel Company announced plans to start offering non-stop flights to seven mid-sized Canadian cities next month, including Winnipeg, company officials have halted sales of airline tickets and said they will refund all credit card transactions for reservations.
The reason: the company hasn't been licensed by the Canadian Transportation Agency (CTA), a situation officials are hoping to sort out in the days and weeks ahead.
"During this uncertain time, we didn't want to put anyone with existing bookings at risk, and we wanted to give customers time to make other travel arrangements," said NewLeaf CEO Jim Young, in a prepared statement.
Young said the company -- which was to offer one-way tickets leaving Winnipeg to six other cities for as low as $89 -- hopes to resume taking reservations in the spring, adding "hundreds of thousands of people" visited NewLeaf's website following the announcement of the company's formation.
NewLeaf's lack of a federal license was first raised last week by Halifax-based air passenger advocate Gabor Lukacs, who voiced concern that passengers could be at financial risk if baggage was damaged or lost, or if the company cancelled or delayed a flight. At the time, Young said the company did not need a licence because its operating partner, Kelowna-based Flair Airlines, already had one.
On Monday, Young wasn't backtracking from the comments, saying the company was given an exemption from holding a licence directly. But the company is nevertheless suspending ticket sales.
"There is ambiguity in the air as to whether we need to amend the relationship with our air service provider, or whether we need to have a licence ourselves," said Young, who suggested there are people in the air industry opposed to his company's existence and are actively working to "maintain the existing playing field."
"We welcome a regulatory system in which businesses like ours can thrive in Canada as they do in other countries," he said.
The CTA has launched a public consultation, to end this Friday, over whether people who do not operate any aircraft but market and sell air services to the public need to be required to hold federal licences.
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