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Lynx Air suspends operations, how Air Canada responds

Lynx Air

Lynx Air served 18 destinations, including 11 in Canada, six in the United States, and one in Mexico.

Lynx Air, a prominent Canadian airline, has declared it will suspend its flight operations starting from today, Monday, February 26, 2024. This decision comes in the wake of escalating financial difficulties, intensified by a combination of inflation, rising fuel costs, fluctuating exchange rates, increasing capital costs, regulatory expenses, and intense competition within the Canadian aviation sector.

The Calgary-based carrier, known officially as Lynx Air (Y9), has sought creditor protection, securing an initial order from the Court of King’s Bench of Alberta under the Companies’ Creditors Arrangement Act (CCAA). FTI Consulting Canada Inc. has been appointed to oversee the bankruptcy process for Lynx Air Holding Corporation.

According to the airline’s statement, Lynx Air faces insolvency with inadequate cash reserves, rendering it incapable of sustaining its operations. The airline cited “compounding financial pressures” as the primary catalyst for its operational cessation.

This move marks a significant moment for the Canadian aviation industry, reflecting the broader economic challenges that airlines face in the current global market. Lynx Air’s cessation of operations underscores the critical impact of external financial factors on airline viability, particularly within the highly competitive and cost-intensive aviation landscape in Canada.

Industry professionals are closely monitoring the situation, as Lynx Air’s suspension of services not only affects the airline’s workforce and passengers but also has broader implications for the Canadian travel and hospitality sectors. The unfolding bankruptcy process, under the guidance of FTI Consulting Canada Inc., will likely offer further insights into the financial strategies and restructuring efforts necessary for airlines to navigate through such tumultuous periods.

Air Canada said it will cap fares and add more than 6,000 seats in select markets operated by Lynx Air in response to the airline’s announcement that it is suspending operations beginning February 26, 2024. The measures are to provide Lynx Air customers affected by the carrier’s shutdown affordable options in the Economy cabin on Air Canada flights for travel within Canada, to the US and to Cancun in Mexico so they can return home or make alternative travel arrangements for planned winter trips.

These fares will be available for purchase before February 26 for travel through April 2, to cover the March Spring break periods across Canada and the Easter holiday period. All flights will be available for purchase at or through travel agents. Air Canada will not be able to honour Lynx Air tickets and Lynx Air customers are advised to consult the Canadian Transportation Agency website.

Air Canada is also planning to add incremental capacity of more than 6,000 seats on Lynx routes from Toronto and Montreal to CancunFort MyersOrlandoTampaPhoenix and Las Vegas between February 25 and March 19. However, with the busy winter travel holiday period underway, flights are already relatively full and the carrier’s ability to increase capacity further is limited.

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Theodore is the Co-Founder and Managing Editor of TravelDailyNews Media Network; his responsibilities include business development and planning for TravelDailyNews long-term opportunities.