With few discount airlines, Canadians face steeper fares

Against a backdrop of threats and insults from US President Donald Trump, Canadians have made a point of displaying national pride by shunning cross-border travel to the United States in favour of domestic tourism.

- VJOSA ISAI

But as many Canadians will tell you, flying within the country tends to be prohibitively expensive.

The airfare from Toronto to Vancouver can often cost around the same as a ticket to Mexico or Europe, enough to nudge many would-be domestic tourists toward international travel. That was among the responses 1,500 people shared with the Competition Bureau during a yearlong study of Canada's airline market, the results of which were released on Thursday.

Air Canada, the top carrier, and WestJet Airlines, the next biggest, make up the largest share of domestic air traffic.

"The level of concentration in the industry means that on many routes, travellers have limited choice and pay higher fares than they might in a more competitive environment," Anthony Durocher, a deputy commissioner at the bureau, said during a briefing with reporters. "Our analysis clearly shows that added competition brings important benefits."

Among those benefits are reductions in fares of up to 9% when new carriers enter the market, Mr Durocher said, though he noted that those companies had found little success.

The airline market study began after the February 2024 shuttering of Lynx Air, a discount carrier that had started in 2022. Swoop and Sunwing Airlines, subsidiaries of WestJet, also recently shut down and merged into the parent airline.