VANCOUVER (Reuters) - WestJet Airlines Ltd will not announce any more code-share agreements this year, acompany executive said Monday, after the carrier struck itsfirst, long-awaited deal this weekend.
Even though such partnership agreements are a key part ofits revenue growth strategy, WestJet said additional deal wouldput undue strain on staff during the busy Christmas season whenwinter storms often also play havoc with air travel.
"I would not turn on another code-share until after the newyear is completed," Hugh Dunleavy, WestJet's executivevice-president of strategy and planning, said a day after theairline announced its agreement with Cathay Pacific AirwaysLtd.
Code sharing is the practice where airlines sell space oneach other's flights. It can help to boost revenues as airlinescan offer passengers more destinations while keeping a lid oncosts as they don't have to service all the places themselves.
In WestJet's case, code-share agreements are a central partof its plans to make deeper inroads into the market forbusiness travelers, for whom the ability to connect easily tomany destinations is key.
WestJet, Canada's second-biggest airline, has recentlystarted to expand from its low-budget roots and begun targetingthe business market as it looks for new avenues for revenue andprofit.
The deal with Hong Kong's dominant carrier is not asurprise as WestJet already had an "interline" agreement -- awatered-down version of a code-share -- with Cathay Pacific.
WestJet has a similar partnership with Air France-KLM, making it a likely candidate for a full code-share.Analysts also expect a deal with a U.S. carrier, possibly DeltaAir Lines Inc.
"Overall, with these three anticipated code-shares(covering Europe, Asia and the U.S) the airline's target marketand value proposal should be greatly enhanced, thus improvingWestJet's competitive advantage," Paradigm Capital analystCorey Hammill said in a note to clients.
Dunleavy declined to say which airline might be WestJet'snext partner but added that if it was a U.S. carrier, it wouldfirst sign an interline agreement with that party.
WestJet's shares finished down 28 Canadian cents, or 2.3percent, at C$11.75 on the Toronto Stock Exchange Monday.Bigger rival Air Canada was down 5 Canadian cents, or1.8 percent, at C$2.80.
($1=$1.02 Canadian) (Reporting by Nicole Mordant; editing by Rob Wilson)