Technology Air Canada (TSX:AC) Beats Out WestJet Airlines Ltd. (TSX:WJA) in Q2: Why You Should Avoid Both

18:46  03 august  2018
18:46  03 august  2018 Source:   fool.com

Calgary woman sues for $2.7-million after foot amputated due to fall at Vancouver airport

  Calgary woman sues for $2.7-million after foot amputated due to fall at Vancouver airport A Calgary woman whose foot was ultimately amputated after falling while getting off an airplane is suing WestJet and the Vancouver Airport Authority for $2.7-million. This Week's Circulars require(["c.deferred"], function () { require({ js: '//api.circularhub.com/msn/module.loader.min.js' }); }); Jaqueline Dyck was flying from Calgary to Phoenix when she slipped in water that had accumulated on the gangway while getting off at a stopover in Vancouver, the lawsuit alleges.Following two surgeries, Dyck's right foot became infected and had to be amputated.

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In 2017 airline stocks were coming off a banner year. Air Canada(TSX:AC)(TSX:AC.B) stock had nearly doubled for the full calendar year in 2017 and airlines reported record passenger traffic. This year has been a different story, however.

Back in June I’d discussed why investors should avoid airline stocks this summer with economic headwinds building up. The previous economic crisis ushered in a period of crisis for airliners. Air Canada and other major airliners managed to avert catastrophe, but shares were hammered in 2008 and 2009. Shares of Air Canada are down 10% in 2018 as of close on August 2.

‘Off track’: WestJet Airlines stock dives after posting first quarterly loss in 13 years

  ‘Off track’: WestJet Airlines stock dives after posting first quarterly loss in 13 years The threat of WestJet's pilots going on strike in late May saw the company lose "tens of million of dollars"“Our 2018 results are off track from the path to our 2020 targets and we are now operating in a very different fuel and competitive environment against earlier assumptions,” WestJet’s chief executive Ed Sims told analysts on a conference call on Tuesday.

Air Canada ( TSX : AC )( TSX : AC .B) and WestJet Airlines Ltd . ( TSX : WJA ) both own Canada 's domestic airline sector. While both airlines do the majority of their flights here in Canada , Air Canada is a true worldwide airline , flying to Europe, Asia, South America, and Australia.

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WestJet Airlines Ltd. (TSX:WJA) that suffered the steepest drop after it released its second-quarter results in the beginning of the week. The airliner reported its first quarterly loss in 13 months as it wrestled with a strike threat from its pilots. This comes after the June launch of its low-cost regional airliner Swoop.

One of the most significant threats to WestJet and the industry at large has been the rise in fuel costs in 2018. According to Statistics Canada energy costs were 12.4% higher in June compared to the previous year. This was after an 11.6% year-over-year increase in the month of May. Statistics Canada reported a 24.6% jump in the price of gasoline and a 25.9% increase in fuel oil and other fuels.

Airlines have benefited from the low fuels costs that came after the oil price collapse in 2014-2015. Higher passenger traffic combined with these factors to propel airliners to record earnings. With geopolitical pressures pushing oil and gas prices higher, airliners are facing mounting challenges.

American Airlines flight with smoke in cabin makes emergency landing in Halifax

  American Airlines flight with smoke in cabin makes emergency landing in Halifax An American Airlines flight travelling from Shannon, Ireland, to Philadelphia, Pa., had to make an emergency landing at Halifax Stanfield International Airport on Wednesday because of smoke in the cabin. The Boeing 757 aircraft declared the emergency at 12:40 p.m. AT and landed safely in Halifax about 10 minutes later, said Theresa Rath Spicer, speaking for the airport. "It all happened pretty quickly," she said. The airport's fire service was waiting when the plane landed. Both Halifax Regional Fire and Emergency and paramedics were at the scene.  Despite some reports to the contrary there were no injuries.

Should investors buy Air Canada ( TSX : AC )( TSX : AC .B) or WestJet Airlines Ltd . ( TSX : WJA ) following the release of WestJet 's ultra-low-cost carrier Swoop?

Fly on eligible Air Canada , Air Canada Express, Air Canada Rouge or other Star Alliance member airline flights. Scheduled flights operated on behalf of Air Canada Express by Jazz, Air Georgian Limited , Exploits Valley Air Services Ltd . and Sky Regional.

WestJet alluded to these factors as it announced that it would cut the number of available seat miles by 6%. It is also in the process of examining other routes to determine where capacity can be cut going forward. Higher fuel costs have been a headache, but it is the threat of the pilot strike that drove down profits in the second quarter. WestJet reported many cancellations and turned to heavy discounting in order to make up ground.

Broader economic headwinds are also a concern for airliners, as I discussed earlier in this article. According to recent reports, higher interest rates are already putting a larger burden on consumers. The Bank of Canada raised the benchmark rate again in July, but also warned of several problem areas in the economy. These included the housing market, trade issues, and the problem of near-record high consumer and household debt.

These potential headwinds combined with higher fuel prices make airlines a gamble for investors at this time. Of the two we have covered today, Air Canada has managed to avoid the complications that WestJet had to contend with in the second quarter. It also posted a fantastic second quarter and posted record operating revenues of $4.33 billion.

Airliner has close call with drone, 4,000 feet over Edmonton

  Airliner has close call with drone, 4,000 feet over Edmonton A WestJet airliner flying at 4,000 feet on approach to Edmonton International Airport on Tuesday had a "near-miss" with a large drone, police say. The plane was on approach when the pilots spotted the drone, which was roughly one metre across on each side, flying off their left wing, according to a police statement.

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Air Canada ’s positioning is quite clear: the high-end of the airline market. WestJet . Casey on Why You Should Never Pay Baggage Fees… And How To Do It. Andrew D'Amours on Car Rental Insurance: THE Worst Travel Scam Out There.

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WestJet dispatchers seek to unionize .
WestJet dispatchers seek to unionize The Canadian Airline Dispatchers Association (CALDA) said in a release that they have filed an application with the Canada Industrial Relations Board to represent dispatchers at the carrier.

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