NewLeaf Travel selling airfare tickets again; first flight takes off July 25

After a sputtered start, discount airfare ticket seller NewLeaf Travel is set to take to the skies next month.

The Winnipeg-based startup began selling tickets again on Thursday, five months after it abruptly suspended operations and refunded fares as it awaited a federal regulatory ruling.

The company now says it plans on operating 60 flights a week, with the first flight scheduled for take off on July 25.

It’s also added more destinations to its service since its original launch in January, which now include Halifax, Moncton, Hamilton, Winnipeg, Regina, Saskatoon, Edmonton, Kelowna, B.C., Kamloops, B.C., Fort St. John, B.C., Abbotsford, B.C. and Victoria.

NewLeaf had to stop ticket sales after a week when it hit some turbulence over whether it needed a licence to operate. The company contended that it did not require a licence because it does not operate airplanes and only resells seats from Kelowna, B.C.-based Flair Airlines.

In late March, the Canadian Transportation Agency (CTA) ruled in favour of NewLeaf and cleared the way for the company to resume ticket sales.

NewLeaf CEO Jim Young said the company was delayed in its relaunch following the ruling for a number of reasons, including negotiating the additional routes and ensuring that its policies were in sync with CTA’s guidelines.

“We went through the act and understood what the specific guidelines were and we went back into our business practices and our marketing messages in order to be able to make sure that we comply,” he said.

Some of the changes involved the company’s marketing and advertising materials to make certain that customers understand the company is a ticket reseller and not an airline.

Young refuted concerns that consumers are less protected if they purchase a flight through NewLeaf, which is permitted to operate without a licence.

He noted that travellers will be protected from ticket issues under their terms-and-conditions agreement with NewLeaf and from flight issues under a tariff held by the federally licensed Flair Airlines.

“The way the contract of carriage and booking terms of conditions are written, the customers are as protected as they would be if they were flying with the other guys,” said Young.

NewLeaf, which bills itself as an alternative to airline juggernauts like Air Canada (TSX:AC) and WestJet(TSX:WJA), offers “no frills” flights that start at $79 one-way, including all taxes and fees.

Its tickets are discounted because its flights fly out of mostly smaller regional airports with lower landing fees and make customers pay fees for extras like carry-on and checked baggage, priority boarding and call centre assistance.

Flair Airlines, which owns and operates a fleet of Boeing 737-400 jets, will also provide the pilots and crew members.

Earlier this month, the Federal Court of Appeal agreed to hear an appeal by air passenger rights advocate Gabor Lukacs over whether the CTA has the jurisdiction to permit NewLeaf to operate without a licence, arguing that other companies that have operated under similar business models have been required to hold licences.

Lukacs questions whether travellers’ rights will be still be fully protected — for instance if a flight is overbooked — if they originally purchased their airfare from a company that doesn’t actually operate the airplanes.

Young doesn’t see the court action as an issue that will cause any more delays for the company’s operation.

“We believe that it doesn’t have much basis to it,” he said. “But the individual has the right to be heard in court and we have the right to defend ourselves in court.”

In fact, the company is already looking into an expansion, by adding on U.S. destinations this winter possibly to Florida, California, Texas and Colorado.

Ultra-low cost airlines and air carriers, such as Spirit Air and easyJet, are common in many parts of Asia, the U.S. and Europe where there are more higher-density markets.

Follow @LindaNguyenTO on Twitter.