Canadian travellers spring break scrapped as jets get seized

BLOOMBERG

Canadian holidaymakers jetting south for spring break on red-eye flights with Flair Airlines Ltd were in for a surprise when the Boeing Co 737s they were about to board were seized by agents acting on behalf of a jet leasing firm that manages the planes.
The episode emerged from a $50 million lawsuit filed by Flair in the Ontario Superior Court of Justice, in which the budget carrier alleges Airborne Capital Ltd. “unlawfully” seized four planes — stationed in Toronto, Edmonton and Waterloo — because they “found a better deal leasing or selling the aircraft” to another airline.
Airborne, an Ireland-based leasing firm, counters that the contract was terminated following a protracted five-month period in which Flair was “regularly in default of its leases by failing to meet its payments when due.”
“Terminating an aircraft lease is always a last resort, and such a decision is never taken lightly,” an Airborne spokesman said in a statement. “In this case, following numerous notices to Flair, it again failed to make payments when due and Airborne took steps to terminate the leasing of the aircraft.”
The drama on the tarmac illustrate the tensions underneath the aviation industry’s rapid rise from the pandemic. While bookings have soared, pushing ticket prices higher, rising fuel costs and a dearth of staffing have weighed particularly on smaller and ultra low-cost airline operators. Norway’s Flyr AS filed for bankruptcy less than two years after starting flying. Days earlier, British low-cost carrier Flybe ceased operations after collapsing into administration.
Flair said in its court filing that “the seizures were orchestrated in a bad faith and malicious manner that inflicted the maximum possible harm on Flair, including by interfering with its passenger relationships and trust.”
Led by former executives from Hungarian discount specialist Wizz Air Holdings Plc, Flair announced plans in early 2021 to rapidly scale up, including leasing 13 Boeing 737 Max jets with plans to reach
50 planes in five years, offering cheap flights on domestic routes across Canada and to international destinations including San Francisco, Las Vegas, New York and Cancun, Mexico.
Flair, which received financing from 777 Partners LLC, was later forced to overhaul its structure to lessen the influence of the Miami-based investment firm as Canada doesn’t allow foreign investors to control airlines.
Canada’s transport agency ruled in June that Flair does meet domestic ownership requirements, allowing it to continue operating flights.
In a subsequent statement, Flair said will keep flying. The carrier plans to operate 21 aircraft this summer, including one plane it is wet-leasing — meaning it comes with a full crew — in order to tide over the absence of the seized jets.