WestJet's pricing algorithm is messed up!
Fly to Europe for only $90 CAD.
Written by K. Amjad
31st June
2022
WestJet...who flies it outside of North America anyway?
WestJet primarily operates flights in Canada, U.S.A., Central America and eight routes to Europe. This article will explore WestJet's pricing for their European routes. With these flights you can pay less than $150 CAD to fly from Canada to Europe or vice versa. There's even an example of a London to Toronto ticket being priced at $90 CAD.
As an avid frequent flier you may find this opening paragraph a pitch for a redemption flight, however, I assure you this is not a points or redemptions pitch. As a matter of fact I do not even have a WestJet membership. This is an analytical article and all tickets are purchased on cash.
I would consider WestJet a mid-class airline for its European routes as it directly competes with Air Canada, the leading airline of Canada for these eight routes. Air Canada has three classes of service to its European destinations (Economy, Premium Economy, and Signature Business) and WestJet has three classes of service to Europe as well (Econo, Premium, and Business). Both Air Canada and WestJet fly the 787 Dreamliner to several of its European destinations. The only noticeable difference between Air Canada and WestJet is the added benefits of flying Premium Economy or higher with Air Canada (Lounges, Priority services, and better loyalty program). This is not relevant, however, because the focus of this article will be on Economy tickets.
This article will describe to you how to structure your future flights in such a way that you can purchase multiple round trips under a single ticket. You will end up paying less than a single round trip for this ticket by leveraging WestJet's messed up but hugely beneficial pricing algorithm.
Europe round trip
My wife and I are travel junkies and love to travel on long weekends, and I get National Truth and Reconciliation day off, which is Friday, 30th September this year. I decided I would travel to Dublin from Toronto on Thursday, September 29th 2022 (after work) and return back to Toronto on Monday, October 3rd 2022. The cheapest ticket I could find was WestJet Econo for $521 CAD. As a Canadian, you are probably wondering why Europe round trip is cheaper than Canada coast to coast round trip. The reason is because Europe has the world's most open airline markets. That means robust competition which puts downward pressure on fares.[1]
Taking it up a notch
I noticed on my calendar that Thanksgiving was Monday, 10th October. My wife and I had another opportunity to make a long weekend trip to Europe. Initially, I searched for the best round trip option to Europe out of Toronto on Friday, 7th October 2022 (after work) and returning back Monday, 10th October 2022. Again the cheapest flight was WestJet for $521 CAD.
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Combining these two separate tickets together would cost me $1048 CAD and would generate two separate reservations. Two reservations is a bit inconvenient and for frequent travelers it adds unnecessary complexity. I could purchase the two separate tickets and call WestJet and ask them to combine the two tickets into one (Yes, they can do that) or I could see what WestJet prices this ticket when I try to book all four flights as a multi-city booking.
The secret sauce: Multi-city booking
Most individuals are familiar with one-way and round-trip bookings, however, there is a third option for booking flights called multi-city bookings. As the name suggests it allows you to mix or change up departing and destination airports. For example, I could fly from Toronto to Miami on Air Canada and then fly out from Fort Lauderdale t0 Toronto on Air Canada and the airline will allow me to book and provide me a price for this multi-city booking.
Multi-city bookings also provide you additional flexibility as you can add multiple segments to your trip. A one-way has one segment, a round trip has two segments, however in a multi-city booking you can add up to 5 segments. For example, if I wanted to fly
Toronto to Dublin Day 1,
Dublin to Toronto Day 2,
Toronto to Dublin Day 3,
Dublin to Montreal Day 4,
Toronto to London Day 5,
The airline will give me a price for all these segments (regardless of the departing or destination airports not matching) as a single ticket. Intuitively, since multi-city provides more flexibility, it should be more expensive, right?
Well, no, this is where the WestJet algorithm is super messed up. Using Google Flight's multi-city search I got my four segments (for my dates) at $616 in total. Which compared to the $1048 CAD I was about to pay is a steep discount (40% cheaper)!
Counter-intuitive pricing algorithm
When I first saw this I was really confused because it's so counter-intuitive. The questions that came to mind were:
1. Why is this priced cheaper than the two round trips together? Realistically this should be priced the same as the two round trips.
2. Why is adding the second round trip (October 7th to October 10th) come at a marginal increase of $95 CAD - the difference between $616 CAD and $521 CAD? That is a steal!
I was not able to find a clear reason to explain either of the questions and neither was I going to WestJet for an explanation. They would immediately remove this arbitrage. My best guess is the algorithm WestJet uses to price has some pairings that make multi-city flights very cheap.
Taking this to the next level
Earlier I mentioned that multi-city bookings allow you to book up to 5 segments. But what if we added one last segment to our ongoing plan? I have Remembrance day Friday, November 11th off, so I began to search flights to Europe from Toronto to add as my fifth segment. After a few searches I finalized the itinerary below. My last segment was Toronto to London, UK and I paid a marginal difference of $81 CAD to add this. My total was now $697 CAD for
two and a half Europe round trips.
Toronto to Dublin: Thursday, September 29th 2022
Dublin to Toronto: Sunday, October 2nd 2022
Toronto to Dublin: Friday, October 7th 2022
Dublin to Toronto: Monday, October 10th 2022
Toronto to London: Thursday, November 10th 2022
Don't stop here
If you start your multi-city flights from Europe then this multi-city tickets becomes even cheaper. Check out this amazing deal I found.
The total price of these flights is incredibly cheap, the average of each flight being $80CAD - $90 CAD (401/5 segments or 448/5 segments). This probably gives the airline no margin to make money off of you.