WestJet, the Canadian LCC, is on a roll: eight consecutive quarters of record earnings, industry-leading financials in 2007 and continued 16%-plus capacity growth in 2008. Why is the Calgary-based carrier outperforming its peers? What strategies is it deploying to ensure future success? While WestJet has been profitable throughout its 12-year history (except for a small operating loss in 2004), in the past two years it has suddenly emerged as one of the most profitable airlines in the Americas. Just as the other LCC high-flyers in the region -Southwest, JetBlue and the Brazilian LCCs -have seen their profit margins fall due to fuel and other challenges, WestJet has seen the opposite: its operating margin increased from a negative 1 % in 2004 to 4.4% in 2005,11.3% in 2006 and 14% in 2007.
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