Flair apologizes for cancellations after plane seizures, says leasing company in talks with competitor

The CEO of Flair Airlines has suggested four planes were seized from his airline because the lessor was in talks with another airline.

Stephen Jones, CEO of the Edmonton-based discount airline, held a press conference Tuesday morning, three days after four of its leased planes were seized.

The planes were seized from airports in Toronto, Edmonton and Waterloo by New York hedge fund company Airborne Capital.

Jones confirmed Flair owed the company $1 million on the leases, but called the seizure a calculated and unusual action.

"A million dollars, while it’s a lot of money, is less than half one-day sales for us, so it's not that we were desperately short. We were in communication with them, I was talking to the head of Airborne on Friday, saying, 'You’ll be paid on Monday,' and then this happened in the middle of the night on Friday night," he told reporters.

Jones said it's not unusual for airlines to make lease payments a few days late, but added in his two decades in the industry, he's never seen a leasing company seize planes.

"We think that the seizure of these aircrafts was connected to conversations with another airline," he said, but refused to say which airline.

"As a lessor the last thing you want to do is take back aircrafts unexpectedly and be stuck with them, so it’s pretty clear they had somewhere else to put these aircrafts."

Airborne Capital released a written statement regarding Jones' allegations on Tuesday.

“Airborne Capital strongly rejects the allegations that have been made by Flair Airlines in recent days in relation to four Airborne-managed aircraft," the statement says, adding the leases were terminated after Flair was regularly late on its leasing payments for a five-month period.

"Terminating an aircraft lease is always a last resort, and such a decision is never taken lightly. 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."

Airborne said it has legal obligations to mitigate the losses on the planes, and has taken steps to meet those obligations.

The company said it would not be speaking further on the matter.

'VERY SORRY' TO PASSENGERS IMPACTED

Jones confirmed that just under 1,900 passengers were impacted by the cancellation of 12 flights as a result of the seizures.

Four of the cancelled flights were out of Edmonton, with 532 passengers impacted.

He says Flair worked to rebook passengers on new flights, both on Flair or by providing up to $500 to book flights on other airlines.

"We're really sorry for the impact that it’s had on customers," Jones said, adding Flair resumed normal operations as of Sunday.

"We had three spare aircrafts already in the airline waiting for the summer pickup, so we immediately deployed those, and the full schedule flew on Sunday."

He says consumers can be confident about booking with Flair in the future.

"Customers can be comfortable that they will get there, and not be disrupted by this event."

Jones says the airline is now current on all its lease payments, including on the two planes it still leases from Airborne Capital.

"Obviously the relationship is somewhat strained at the moment, but we'll keep those aircrafts and keep them current."

He says the airline is working to obtain four more aircrafts to maintain its summer schedule, which was announced last week.

"If we don’t get these four back, and it’s looking increasingly unlikely, then we’ll need to either find extra aircrafts for the summer, or trim our capacity and schedule a little."

"We’ll continue leasing. All the rest of our leasing companies are very supportive."

He added that fares won't increase as a result of the seizures.

"It's in our interest to keep our fares as low as possible, our aircrafts as full as possible."

FLAIR'S HISTORY 

Flair launched in 2004 as a charter airline, and began offering regularly scheduled service in 2018.

The airline has made a number of announcements about route and fleet expansions in recent years, and aims to be Canada's third-largest domestic airline.

In 2022, Flair was investigated by the Canadian Transportation Agency over concerns the company did not have a majority Canadian ownership.

In June 2022, the CTA ruled that Flair was Canadian and could keep its licence.

With files from CTVNews.ca's Michael Lee.