A few years ago Air Canada, in an attempt to cut costs, simply substituted Rouge in Western Canada as a replacement for it's regular service on many U.S. routes out of  Vancouver and Calgary.

There was no corresponding fare cuts though as Air Canada (Rouge or otherwise) fares remain in lockstep with not only West Jet pricing. but other carriers operating out of Canada.

I suspect West Jet will follow this model and substitute it's new "carrier" on many runs, whilst still keeping price on a par with Air Canada.  The customer will see a substantial service reduction, and very little price savings.