Jetsgo Ceases Operations

[armada]

Jetsgo Ceases Operations


MONTREAL, March 11 /CNW/ - Jetsgo Corporation announced today that it is
ceasing all operations effective immediately.
Passengers are advised to make alternative travel arrangements prior to
going to the airport as there will be no Jetsgo staff or aircraft available.
Travellers seeking to return to their point of origin must make alternative
arrangements with other airlines or with their travel agent or tour operator.
Jetsgo will be asking that the Quebec Superior Court immediately grant it
protection under the Companies' Creditors Arrangement Act. Court protection
will allow Jetsgo to consider all options available to reorganize its affairs.
Given difficult market conditions resulting from competitive pressures in
the Canadian airline industry, Jetsgo has determined that, in the
circumstances, it is prudent and responsible to discontinue its operations and
ground all of its planes.
Michel Leblanc, President of Jetsgo, said: "We deeply regret that this
had to happen. The decision to cease operations was only taken after difficult
deliberation. We are very concerned about our customers and the significant
hardship that this action causes. In the meantime, we encourage our passengers
to contact their travel agent or an alternative airline."
Jetsgo intends to keep its stakeholders, including its employees and
customers, informed of the development of its restructuring process.
Information and Court filed documents regarding the CCAA proceedings will be
available on Jetsgo's website at www.jetsgo.net as well as on RSM Richter
Inc.'s website at www.rsmrichter.com and will regularly be updated.
Information may also be obtained by communicating with RSM Richter Inc. by
telephone at 1-800-246-1125.
If you are a customer of Jetsgo and have paid for a flight that is no
longer scheduled, you may wish to communicate with the Canadian Transportation
Agency: by telephone, 1-888-222-2592, by fax, 1-819-953-5686 or on its website
at www.cta.gc.ca, or the appropriate provincial authority:

- Ontario: The Travel Industry Council of Ontario (TICO)
Tel.: (905) 624-6241 /Toll-free: 1-888-451-TICO

- Quebec: Office de la protection du consommateur,
Gouvernement du Québec
Tel.: 1-888-672-2556

- British Columbia: Business Practices and Consumer Protection Authority
Tel.: (604) 320-1667; Toll-free number: 1-888-564-9963

- Alberta: Alberta Government Services Tel.: (780) 427-4088;
1-877-427-4088 toll-free number in Alberta only

- Manitoba: Consumer and Corporate Affairs, Consumers' Bureau
Tel.: (204) 945-3800; 1-800-782-0067 toll-free within Manitoba

- Saskatchewan: Saskatchewan Justice, Consumer Protection Branch
Tel.: (306) 787-5550; 1-888-374-4636 toll-free number in Saskatchewan

- New Brunswick: Department of Justice - Consumer Affairs Branch,
Provincial Government Tel.: (506) 453-2659

- Nova Scotia: Business & Consumer Services, Consumer Complaints
Tel.: (902) 424-5531

- Prince Edward Island: Department of Consumer and Corporate Services
Tel.: (902) 368-5653

- Newfoundland and Labrador: Consumer Affairs Officer, Department of
Government Services and Lands
Tel.: (709) 729-2623


:ouch:

[Guzzler]

I have just landed at Toronto and walking through customs we were told what had happened.

Made sense of a few radio calls we heard on the way back from Cuba.

What happens to the $30,000 training fee the pilots pay to get a job?

Skyservice are gonna be busy.

[Rollingthunder]

Well, that was a shot out of the blue. There were rumours but bankruptcy so fast? Was it totally financial? Two weeks ago they announced they were significantly increasing Western Canada operations to compete hardline with Westjet.

You go for bankruptcy protection over here but generally keep operating in the meantime. These guys cease operations immediately and then seek bankruptcy protection.

Anyway, thinking of the passengers stranded once again. Thinking of staff also at the moment. Jetsgo management apparently is not.

[I am Birddog]

The Story... http://www.theglobeandmail.com/servlet/story/RTGAM.20050311.wjetsgo0310/BNStory/Business/


I would like to start a fund to aid all JetsGo pilots and their families especially those that just started.

I will be asking the Admin @ www.avcanada.ca to be the primary holder of the funds as donations come in.

Anyone have any thoughts on how best and efficient potential funds can be distributed?

IABD

[Lite]

Rumours of JetsGo's demise have been floating around for quite some time, but I didn't know that the problems had been so serious.

The airline had a number of maintenance issues with the MD-83s which gave the airline quite a reputation for delays, and the service levels onboard simply did not match that of fellow Canadian no-frills airline WestJet.

Whilst there was a huge void in capacity when Canadian was snapped up by AC, and the subsequent demise of Royal/Canada 3000, WestJet has expanded fast enough with their modern fleet to partially fill that void.

[idleopdes]

My sincere condolences to all Jetsgo employees and their families...

Dave @ AC

[Jerricho]

Ive just read in the Globe and Mail that Westjet will

implement a plan until March 14 for stranded passengers that would give them special fares in markets served by both carriers.

I'm sorry to hear about the whole mess.

[eight iron special]

WRONG!

These pilots made a conscious decision to pay the $30,000 for their training, and thereby voluntarily accepted the risks of this happening. They diminished the stature of the profession by doing this, and therefore are not entitled to any assistance beyond Canada's Unemployment Insurance.

Risk versus reward.......

[darrylk]

Hi everyone.
I am trying to learn more behind the truth of the Jetsgo story.
are there any former pilots, workers etc I can speak to.
Where did the pilots gets their training? Is this a for sure?

Is the owner of this airline the same man who owned Royal and Int-air??

Darryl Konyennbelt
Global National
905-334-0415

[Globaliser]

eight iron special: These pilots made a conscious decision to pay the $30,000 for their training, and thereby voluntarily accepted the risks of this happening. They diminished the stature of the profession by doing this, and therefore are not entitled to any assistance beyond Canada's Unemployment Insurance.The mark of most true professions is that they pay for their own training. I have the utmost respect for what pilots do, and their status as professionals - but you're skating on very thin ice with this argument.

[ttfncvk]

Is the owner of this airline the same man who owned Royal and Int-air??

One and the same

[LHR2YYC]

Just spoke to one of their Dispatchers no one in the Company below director level new this was coming.Crews are stranded just like the pax.

[eight iron special]

Globaliser;

You said "The mark of most true professions is that they pay for their own training."

Pilots pay for their training in order to get their licenses, just as a doctor pays for medical school and lawyers pay for law school.

However, once qualified, does a doctor pay $30,000 for being an intern at a specific hospital? Does a lawyer pay $30,00 to article at particular law firm?

[Orca strait]

Globaliser:

Pilot's pay for their own ab-initio training, whether it is a contract commitment with the Air Force, Cadet program through an Airline or the good old fashioned way of slogging it out on your own. This would be equivlent to a University degree in terms of both time spent and funding ($50,000+).

Once you are in the employ of an air carrier the type specific training rests with the company. The company is not training you to be a Pilot as you have already aquired these accreditiations (Private Pilot, Commercial Pilot, Night Rating, Multi-Engine Instrument Rating, Airline Transport Rating etc.)

In this case the Air Carrier woud hire you as a Pilot, assuming you meet all the minimum qualifications (hours flown, type of aircraft flown etc.), then assign you to an aircraft in which you would take type specific training. At the end of the training a Pilot Prificiency Check (PPC) is completed under the oversight of the Federal Regulatory body (JAA, FAA, Transport Canada etc.) The PPC then has to be re-done every 6 months or you lose the right to fly. Fail the PPC more than three times - life gets real complicated...

The PPC training is what eight iron special is talking about. In recent years low value (not lo-cost) Airlines have been taking advantage of the Pilot Profession by establishing minimum term employment contracts (typically 2 -3 years). Attached to these contracts are bonds - in Jetsgo's case $30,000 committed by the Pilot at time of hire. If the Pilot should leave within the 3 year contract period then the Airline can demand all or partial payment of the bond.

Sounds reasonable in theory, however...

Now there is no incentive for the Air Carrier to commit to reasonable and fair working conditions. The salaries tend to be extremely low, flight hours the maximum allowed under law, poor or minimum follow up training, minimum maintenance, ground handling etc. (ALL of the items that are coming to light about Jetsgo). In the meantime, your Professional Pilot has become a willing accomplice as his or her number one priority at this stage is to remain employed so as to not lose their $30,00 dollar investment.

At the end of the day your low value carrier drives the ticket prices to a lower than true cost margin causing air carriers that are trying to run a safe reliable operation to meet these unrealistic prices.

As Professional Pilots it is imperative that we stop this proccess right at the outset by NOT Signing these idiotic bonds .

Some will argue that "if I don't sign on, somebody else will so it might as well be me putting time in my logbook". History is full of that type of individual thinking - none of it with good outcomes...

[b767jetmec]

I would like to start a fund to aid all JetsGo pilots and their families especially those that just started.

Why just the pilots? why not maintenance, flight attendants CSA`s etc.? Are they the only ones hurt by this situation? I hope you were being sarcastic! :mad:

[gumbi]

excellent post Orca, :ok:

[Left Coaster]

While we can symapthize in our family, (got the tshirt) I don't seem to recall any offer of a fund (ecxept from those who were in the company...) thanks for that ...to help any C3 pilots...why is jetsgo any different?

[RatherBeFlying]

It's been a looooooooooong time since a Canadian carrier left its pax and crews in the lurch.

Part of the reason is that the Companies Creditors Arrangements Act normally puts the company under control of a receiver who continues operations.

Michel LeBlanc has just incinerated any and all goodwill towards JetsGo in the Canadian public.

The morning news woke me up to the news of Toronto area families on their long planned spring school break vacation trip wandering around the terminal.

Spring Break flights to resort destinations are typically booked full several months in advance and seats on alternate carriers to these destinations are not to be had for love or money.

Then there's the folks who suddenly have no way to get back to work -- the JetsGo customer base being mostly constituted of low budget travellers whose credit cards are maxed out by the time they're on the way back:uhoh:

At least there's nobody coming to boot them out of their accommodations:ooh:

I have no idea what M. LeBlanc and his receiver must be smoking, but I always thought flying full planes was good for the cash flow:confused:

[innuendo]

RBF:

"It's been a looooooooooong time since a Canadian carrier left its pax and crews in the lurch."

Not so sure about that, I had friends stranded in Hawaii when Canada 3000 ceased operations and it was not that long ago.




"I have no idea what M. LeBlanc and his receiver must be smoking, but I always thought flying full planes was good for the cash flow"
Not if you are filling the planes by giving the seats away at unsustainably low fares.

[PPRuNeUser0172]

Jetsgo, IMHO was never going to work, there is strong competition from Westjet, Canjet and to a lesser degree, Air Canada Jazz which they never managed to put a dent in. The fundamentals of a low cost airline, is a common fleet, at least until it has momentum, a good reputation and a good route network. Jetsgo had none of these, operated maintenance intensive MD83s and introduced the F100 which then means that maintenance costs go up, type rating/training pilots/crew becomes an issue, correct me if I am wrong the MD83 and the F100 dont have a common type rating??

It would seem that they had an ambitious route network which spread themselves to thinly, and the frequency was not sufficient to tempt travllers away from other carriers. It would seem prudent to find a niche in the market, get a strong business base and then spread into other markets, slowly but surely.

Operating a mixed fleet is going to be a serious issue for a low cost airline, All successful low cost carriers started out with one fleet until they were strong in their market. Look at Southwest, Easyjet, Jetblue (albiet until recently) Westjet, even got rid of their old 737-200's to cut costs. Coupled with fuel costs, poor management and a tidal wave of public dissatisfaction, they were doomed months ago.

The chap in charge should find another business venture in future.

[russellackland]

An airline that makes pilots pay for their employment is unfairly taking advantage of the pilot profession. There is a long history of debate and innuendo about pilots who work at a "pay-for-job/training" company and most pilots have an opinion either for or against this practice. I am disgusted by any company that practices it, although my feelings are not necessarily directed against the pilot who avails themselves of this kind of employment. The demise of Jetsgo and it's effects on their pilots will be added to my list of arguments as to why I am against any airline that uses "pay for training".

[eight iron special]

Well said, Orca.

[great southern land]

At the risk of sounding harsh: other than the pain this causes all the employees, I think it a GOOD thing that people lose their deposits for training in cases such as this. Ours is a PROFESSION, which has been badly damaged and undermined by people on the lower rungs of the ladder who are willing to do ANYTHING to fly that 'shiny jet'. All they do is convince companies that they can exploit and undermine pilots and their careers. Once you have obtained your licences, you are to be considered a PROFESSIONAL. That means that you should be hired on MERIT, not your ability to write a check. The more cases that occur such as Jetsgo, the better it will be for the profession. If they expect you to pay for a job...the job isn't worth having..... Hopefully pilots around the world will slowly learn this lesson.

[Rollingthunder]

Two MD83s still on the gates on the B concourse at YVR. Why didn't they at least fly them back to base? A badly handled shutdown. M. Leblanc and his cronies should not be allowed near an airline for 142 years.

[Cpt. Underpants]

Canada's Lorenzo. He (Mike The White) should not be allowed to engage in any aviation-related activity - EVER. He (and his ilk) are a scourge on the face of the industry.

[RatherBeFlying]

Goodwill thoroughly incinerated -- CBC Pax and Crew Stories (http://www.cbc.ca/news/viewpoint/yourspace/jetsgo_failure.html)
Me -- It's been a looooooooooong time since a Canadian carrier left its pax and crews in the lurch.

innuendo -- Not so sure about that, I had friends stranded in Hawaii when Canada 3000 ceased operations and it was not that long ago. That was M. LeBlanc's previous venture as others have pointed out:uhoh:

Allow me to correct that to a Canadian carrier not connected to M. Leblanc:(

[rotornut]

Interesting insight into Leblanc from to-day's (March 12) Globe and Mail:

An airline addict hits his fourth wall

http://www.theglobeandmail.com/servlet/ArticleNews/TPStory/LAC/20050312/RLEBLANC12/TPBusiness/Canadian

[Globaliser]

Orca strait: Pilot's pay for their own ab-initio training, whether it is a contract commitment with the Air Force, Cadet program through an Airline or the good old fashioned way of slogging it out on your own. This would be equivlent to a University degree in terms of both time spent and funding ($50,000+).

Once you are in the employ of an air carrier the type specific training rests with the company. The company is not training you to be a Pilot as you have already aquired these accreditiations (Private Pilot, Commercial Pilot, Night Rating, Multi-Engine Instrument Rating, Airline Transport Rating etc.)

In this case the Air Carrier woud hire you as a Pilot, assuming you meet all the minimum qualifications (hours flown, type of aircraft flown etc.), then assign you to an aircraft in which you would take type specific training. At the end of the training a Pilot Prificiency Check (PPC) is completed under the oversight of the Federal Regulatory body (JAA, FAA, Transport Canada etc.) The PPC then has to be re-done every 6 months or you lose the right to fly. Fail the PPC more than three times - life gets real complicated...

The PPC training is what eight iron special is talking about. In recent years low value (not lo-cost) Airlines have been taking advantage of the Pilot Profession by establishing minimum term employment contracts (typically 2 -3 years). Attached to these contracts are bonds - in Jetsgo's case $30,000 committed by the Pilot at time of hire. If the Pilot should leave within the 3 year contract period then the Airline can demand all or partial payment of the bond.Coming at this from a lawyer's point of view: I've paid for all my "ab initio training" to get qualified. I have to continue to pay for my "recurrent training" year by year, which I am required to do to keep my "licence" to practise. If I want to acquire a new specialism, and have to study to learn it, I have to pay for all of that myself. As I happen to be self-employed I would also simultaneously give up part of my earning capacity because I have to devote some time to the study.

Sometimes, some lawyers will manage to get some of this "recurrent" training sponsored and/or paid for by someone else, for example if they have a large corporate employer. But this is far from universal. And that's just the way that traditional professions work.

If the $30,000 that eight iron special referred to is a form of golden handcuffs rather than payment for training, then I have misunderstood the point being made and I apologise. I can well understand the effect of golden handcuffs. It was the suggestion that the mere fact that one pays for one's own training diminishes the status of one's profession that I would vehemently disagree with.

[Sawbones]

A very sleazy shutdown of Jetsgo indeed, in my opinion. The media has interviewed customers who made on-line reservations as late as midnight on the night of the shutdown.

The statement from Michel Leblanc was issued in written form ... never any public appearance/interview. He's gone into seclusion, obviously unwilling to show his face. Would seem he has extracted as much money as he possibly could on the eve of a most busy travel week in Canada and then split before he had to waste a dime on actually providing a service.

Television showed work crews disassembling ticket counters and computer stations in the middle of the night. The only thing left for arriving passengers in the morning was a letter displayed for all to read. There were no Jetsgo Management/Supervisors on hand to deal with the naturally angry passengers. As I recall, when Canada 3 stopped flying "former" employees worked the counters trying to help their customers, quite aware they would not be paid for that most difficult of shifts.

Two lessons to be learned from this disaster, but only in my dreams do I think they could ever in fact happen ...

1: Passengers should wake up and realize that you don't get a safe, dependable, reliable airline flight for peanuts. (You might get a bus trip, but even that will likely cost more).

2: Pilots worldwide should turn away from Companies that want training bonds/cash/loans signed prior to starting work. They just aren't worth it in the long run.

And hopefully .... the industry has seen the last Mr. Michel Leblanc!

Sawbones

[LindbergB767]

D ont worrie folks as I know Leblanc he did not loose any money I bet you he bought several shares of West Jet and Air Can before to pull the plug because he was the only one to know about it It is not the first time he his doing that but I really hope it is the last time

[eight iron special]

Globaliser;

You described the 30K perfectly as "Golden Handcuffs" - well put. As for the lawyer's costs, I was thinking of large firms with 100 partners. In Canada, pilots pay "ab-initio" costs, including upgrading to multi, IFR, etc. I am not a lawyer, but you make sense saying a lawyer must pay his own way - perhaps a bad example.

One thing to remember (and this always stirs a debate) is that a pilot is not a true "professional" like a doctor or lawyer, but is simply highly skilled labour. The practice of paying for these training bonds, in the aviation industry, is not widespread, and prevalent only in these low cost start-up's (Wal-mart's of the skies, if you will). Thus, those who pay for these training bonds are considered desperate and diminish the overall compensation levels in the industry.

EIS

[cd9driver]

More info on the Jetsgo YYC landing incident:

http://www.northamericanflyer.com/modules/news/article.php?storyid=11

[bafanguy]

eight iron special,

A bit off the thread topic, but since you mentioned it, I thought I'd ask.

"...a pilot is not a true 'professional' like a doctor or lawyer..." ?

That's an interesting premise. Would you care to elaborate ? This comes as a bit of a surprise. My dictionary is rather clear on this.

Nothing personal...just curious. I've never heard this said.

[Squibs]

Leblanc is a monster.

Talking of stranded people, I hear a lot of you guy talking about C3. Dont forget Inter-Canadien, Inter, Royal also.
This guy has no social remorses. He thinks of his employees as "profitable rotable material".
I said to myself once that I would never work for him. Well I did underectly... and I was not impressed at all to see him go. I was working for the company who did the c-checks on his MD-83's. Even if things were going good (2002-2003) he didnt want to commit for long term contract agreement with us. Not even mid term. Always leaving the doubt of pulling the plug on the mini contracts he had with us. Always sqweezing more out of the lemon that had no more juice in it anyways. I know that it is not prudent to put all your eggs in the same basket and for security reasons you might want to spead out your work (although all was well where I worked) but he could have at least signed an agreement for a certain number of checks giving our company the freedom to buy more equipment. We did the job right but sometime at a cost. Some poeple got injured on those check cause our company didnt want to invest to much incase Leblanc would pull the plug on us. His cheap way of running his show had effect on everybodys work. But did he invest on trucks.....Boy! He had tons of shinny new trucks that he never used anyways.

He knew from the start that Jets-go would last 3 years.
He was never there (for any of his companies) for the long term.
He might have had the intent to stay in business for long but his skills as a business man are doubtfull. Well in fact it might be that he's pretty brilliant and all of us are very much stupid. Cause in all of his ordeals, I dont think he lost any money, and in fact he did quite a large sum.... (I can still see Angus wounder why Leblanc was laughing when he took the check for the selling Royal....)

I just hope that a rulling of some kind will prevent him to start anyting again.
But if that should be the case (that he is permitted to carry out a sevent bankrupcy) I am shure that a bunch of yahoo's will follow him anyways.
And even if he is refused in his demand to start the sevent bankrupcy, dont forget that he might do it anyways.
Remember Robert Obadia? Dear uncle Bob was banned from starting an airline back in the 90's but that didnt stop him from starting up Fortunair. In those cases you just have to name a "puppet president" and you've got it made in the shade.....

My thought's go out to all Jets-Go employes and all workers that will suffer from this monster we call Mr. Leblanc.

Thanks for nothing Mr. (and here I am polite by still calling him Mister.....) Leblanc.

See you in 2006.
What is it going to be this time?
Jet-Blast?
Con-Air? No sorry that's been taken already.
Or better yet Air-I-dont-give-a-####-about-no-one-and-the-hell-with-you-all-take-your-peanuts-and-shut-up Airways

[Rosbif]

What needs to be clarified here is that signing a bond is one thing. Writing a cheque while signing a bond is quite another.
If these pilots had all asked to put the bond money IN ESCROW, as I have been suggesting they do for the last year or so, then they wouldn't now be standing in line behind the banks for their money.
Leblanc clearly has friends in the right places, and in my opinion had bancruptcy as part of the plan all along.
Go back to posts on this forum over the last year. Nobody can say that they were not warned that this would happen. It has always been a question of "when", not "if".

[ImpairedHearing]

Another sign at how poorly this incident was handled: It was apparently still possible to book flights on Jetsgo even after the news broke that they were shutting down.

[Orca strait]

Globaliser:

We can’t really compare the Professions when it comes to the PPC (Pilot Proficiency Check) issue. I agree that as Professionals it is incumbent upon us as individuals to continually upgrade our skills and education throughout our careers.

The PPC differs in that a PPC can only be issued if you are working for an approved air carrier. In theory I could go to Boeing Flight Safety as a self sponsored candidate and complete a B737 Type Endorsement (Airbus, Boeing, Lear etc.). Upon completion of the course followed by successful grades on the written, oral and flight test exams, I would have B737 Type Endorsed on my license (approximately $40K USD).

I apply at XYZ Airline whom operate B737 aircraft and land the job. The Type Endorsement does nothing for my new Employer except indicate to them that I have passed the academics of flying a generic B737.

I would now undergo the entire B737 course again incorporating Standard Operating Procedures (SOP’s) and all operating criteria that are approved and enforced by the Federal Regulatory Body for XYZ Airline. All of the ancillary courses are incorporated during the initial training period (high altitude indoctrination, crew resource management, dangerous goods, emergency procedures training, anti/de-icing cold wx ops, RVSM, ETOPS etc.). All of the ancillary courses require annual re-currency training and the PPC requires bi-annual training with a flight test and on top of that, an annual route check.

All training programs have to be approved by the Federal Regulatory Body and are then continually monitored. The specifics of each program vary with each Airline therefore the PPC itself is non-transferable; the experience gained by the Pilot however, can be.

Back to Jetsgo…

There are several types of Pilots that apply at Jetsgo – experienced (Captains with multiple types flown and thousands of flight hours) mid-experienced (First Officers with previous second-in-command experience on jet aircraft and new hire (several thousand hours on lighter aircraft but no jet time).

Jetsgo required all of these Pilots’s to pay the $30,000 as a condition of employment and knew they would get away with it as the industry was in an extreme downturn post 911. Taking advantage of the many Airline bankruptcies to snap up personnel and equipment for pennies on the dollar only to use them and abuse them then throw them back on the street a few years later.

By the way, all of the training has a time life, 90, 180, 360 days and the final being two years. If you have not flown in this time your chances of job re-entry are very slim. Most contract agencies require time flown on type that you are applying for to have been within the previous six months.

Michel LeBlanc is the Frank Lorenzo of Canada. The next time he or the Entrepreneurs of his ilk approach the trough again – just say no.

A good company treats its employees with dignity and respect and the employees return in kind (and no, Unions are not the answer).

[jabird]

Looking at this from a European perspective, how much of this failure is due to internal mis-management, and how much due to market conditions?

MOL has long gone on about the "blood-bath" expected with too many airlines chasing too few seats, and the situation just south of the border with so many airlines being propped up by Chapter 11 is equally dire.

Obviously, any airline going out of business is an unfortunate loss for all concerned, and it seems that a lot of people on both sides of the check in desk have been left in the dark on this one.

But how much is Canada really open to no frills airlines? Being one of the largest countries in the world, with a population around half that of the UK, aren't operating costs always going to be much higher? FR might get away with selling a few seats on short hops for £1, but I can't see how that could ever work on YTO to YVR, which is an inter-continental flight in all but name.

How many "Ryanairports" are there in Canada - especially when even YMX has now closed. How much does the climate add to operating costs?

[goates]

But how much is Canada really open to no frills airlines? Being one of the largest countries in the world, with a population around half that of the UK, aren't operating costs always going to be much higher? FR might get away with selling a few seats on short hops for £1, but I can't see how that could ever work on YTO to YVR, which is an inter-continental flight in all but name.

That is what many analysts have been saying for a while now. There is really only room for one large and one low cost airline right now and some charter outfits like Air Transat. Some had also predicted that there would only be one low cost carrier by the end of the year.

Westjet has managed to use smaller airports like Abbotsford and Hamilton to avoid having to fly into Toronto and Vancouver for all flights, but there aren't many places you can do that. For an airline to survive here you probably need to fly into Toronto anyways as that is where the bulk of our population is and where many international flights leave from in the east. Vancouver is the same in the west.

Maybe Canjet and Westjet will merge. Or one will make a fatal mistake and be snapped up by the survivor.

goates

[Left Coaster]

Read the CTV article on MSN Sympatico...he was doing it at ROYAL, and did it at Jetsgo..using unearned revenue to pay bills and salary, it's called a PONZI scheme and it's the only way he knows how to play. It means that all the $$$ the company claims to have hasn't been earned yet, only projected. How the industry in Canada puts up with time after time is a mystery. Those who "trusted" Leblanc with their cash won't get it back and too bad for those who thought it was OK. It drove the industry back into the dark ages to when guys like Millard got away with the same sort of money for hire nonsense. Wake up Canadian pilots, your jobs are in danger from these kind of men...

[rotornut]

globeand mail.com

Jetsgo sent jets to Quebec for safe haven from creditors

Under guise of 'air worthiness' checks, company sought to protect its Fokkers
By BRENT JANG

Tuesday, March 15, 2005 Page B1

A financially imperilled Jetsgo Corp. sent the bulk of its fleet of 15 Fokker 100s to Quebec City last Thursday night in a calculated effort to protect its prized assets from creditors.

Jetsgo pilots had been told to refuel and fly to Quebec City for "air worthiness" checks on parts, including engine thrust reversers, The Globe and Mail has learned. A Transport Canada official said no maintenance checks were ordered and airport and aircraft industry officials added that Jetsgo ultimately wanted to ensure an orderly return of its company-owned aircraft.

Four hours before Montreal-based Jetsgo announced its shutdown at around midnight Thursday, the discount carrier started transferring the Fokkers to its Quebec City hangar, keeping the planes away from creditors, such as authorities at Toronto's Pearson International Airport.

Insolvent Jetsgo, privately controlled by Montreal entrepreneur Michel Leblanc, filed for bankruptcy protection on Friday morning in the Quebec Superior Court.

Some of Jetsgo's Toronto-based pilots stayed overnight in Quebec City and then rode a Via train back to their Ontario home base, said one Jetsgo pilot familiar with the situation.

"The pilots were kept in the dark. They would not have flown the planes back to Quebec City if they knew the company was being shut down," one pilot said.

Jetsgo had hired NordTech Aerospace Inc. to provide maintenance, repair and overhaul services in Quebec City for Jetsgo's fleet. NordTech itself is owed $2.5-million for work previously done on the fleet.

An industry source said yesterday that it made sense for Mr. Leblanc to protect his 15 Fokkers from creditors breathing down his neck and to worry less about the airline's 14 leased Boeing MD-83s.

The used Fokkers, with an average age of 12½ years, could be worth $750,000 apiece, depending on their condition, the source said.

Officials working for Pearson's operator, the Greater Toronto Airports Authority (GTAA), had phoned Jetsgo financial vice-president André Deslauriers early last week, seeking payment for landing fees and other charges, such as counter space.

Then GTAA chief financial officer Judy Fountain sent a so-called "arrears letter" to Jetsgo, demanding payment for overdue bills running into the millions of dollars, as did Nav Canada, the country's operator of air traffic control systems.

Nav Canada threatened to seize aircraft on March 7, but backed off after working out a schedule for payments in arrears.

Still, with other creditors attempting to tighten payment schedules, Jetsgo opted to set the wheels in motion that would lead to the 2½-year-old airline seeking court protection from creditors.

One by one, starting Thursday night and lasting through early Friday, the Fokkers owned by Jetsgo made a beeline for Quebec City, including planes from Halifax, Moncton, Ottawa, Montreal and Toronto.

Jetsgo's leased 160-seat Boeing MD-83s followed the usual pattern of parking overnight at Pearson, Vancouver International Airport and Montreal's Trudeau Airport.

Jetsgo bought the 100-seat Fokkers from American Airlines Inc. in February, 2004, and those aircraft would have been easier to seize, compared with getting into a battle over the MD-83s with Jetsgo's leasing company.

Around 9 p.m. last Thursday, GTAA staff began to notice a pattern across Canada of Jetsgo's Fokkers heading for a leased Quebec City hangar. It took them by surprise because on a normal night, those Fokkers would tend to park at whatever airport is listed as that flight's final destination.

By Friday morning, most of the Fokker fleet had made it to Quebec City, a court filing said. However, one Fokker was still in West Palm Beach, Fla., according to a GTAA official who didn't want to be named. Eight of Jetsgo's 14 MD-83s were stored at Pearson, while the remaining six were spread between Vancouver and Montreal.

The Fokker flights to Quebec City didn't appear on the schedule of regular routes. "They weren't on our boards, but they were flights put into the mix. They just had their pilots fly them back, so it wouldn't have been a flight for passengers," GTAA spokeswoman Connie Turner said in an interview yesterday.

On Thursday night around 10 p.m., rumours ran rampant at Pearson that Transport Canada had ordered a special inspection of the Fokkers.

Airport officials believed the rumours had a grain of truth because the federal department had issued a 30-day warning notice to Jetsgo last Tuesday to ensure that its internal manuals would be updated. Transport Canada had uncovered deficiencies in the carrier's "organizational structure," including managers being stretched too thin.

But Transport Canada didn't order any grounding or special inspection of Jetsgo's Fokkers, so "in hindsight, it was very clear that Jetsgo wanted those planes back in Quebec," Ms. Turner said.

A Transport Canada spokeswoman confirmed yesterday that the government didn't force the Fokkers to fly to Quebec City.

Yesterday, Toronto-area Jetsgo employees showed up at a Pearson hangar to collect final paycheques. .

But as with so much of the Jetsgo saga, even the carefully planned final paycheques didn't go smoothly. Late yesterday, court-appointed monitor RSM Richter Inc. addressed concerns from employees who had run into problems cashing their cheques. "We have now been advised that all problems have been sorted out and that cheques will clear the bank," RSM Richter's Yves Vincent said in a statement.

[c3a330]

I empathize for the families of those affected by yet another ruse from Michel Leblanc.
However, the loss of training bonds is just too bad. Paying for your own training is not only blackmail but it undermines the future working conditions for all pilots. I guarantee the next start up low cost carrier will take advantage of the numerous unemployed pilots again. Those of you that accepted those conditions are naive and you are now paying the price. Better luck next time.

I vote to ban Leblanc from the Canadian aviation industry, a la Lorenzo from Eastern.

[dfish]

Now it turns out that there was a buying frenzy of Westjet stock just days before Jetsgo's collapse. On average 300,000 shares are traded daily, on the two days before Jetsgo's bankruptsey 3,000,000 shares were traded. Westjet's shares increased 40% after Jetsgo's collapse. Someone in the know made a lot of money.

Dave Fisher

[CargoOne]

A proper airworthines condition Fokker-100s cost much more than $750k these days... Try $4-5m

[rotornut]

globeandmail.com

Jetsgo founder sorry By ALLAN SWIFT

Thursday, March 17, 2005 Updated at 5:42 PM EST

Canadian Press

MONTREAL — Jetsgo founder Michel Leblanc says he is sorry for the abrupt shutdown of the airline, which marooned some 17,000 passengers, many who were about to depart on vacation at the start of the annual school break in Ontario.

“Very clearly, I have deep sorrow for the people whose plans at school break were shattered, but we didn't have any choice,” Mr. Leblanc told The Canadian Press in an interview in his office Thursday.

Mr. Leblanc added it was not possible for Jetsgo to do other than to pull the plug abruptly just before midnight last Friday.

“When we had to make the tough choice of ceasing operations, that's because we couldn't ensure any more a reliable operation,” he said.

If Jetsgo had tried to declare bankruptcy first, crews and mechanics might have decided not to show up for work, Mr. Leblanc said, putting the airline schedules and safety at risk.

Mr. Leblanc also revealed that he has lost $7-million of his personal fortune in Jetsgo, which he founded in 2002 with the proceeds from the sale of Royal Airlines to Canada 3000.

The company has been given a month under bankruptcy protection to come up with a plan for creditors. Mr. Leblanc said he hopes to salvage some of the company, although it is too early to say what.

He said the company has very low debt and has assets, mainly its 15 Fokker 100 aircraft. He said there is a good market for them.

The other 14 aircraft Jetsgo had were leased.

The founder and majority owner of Canada's third-largest airline had harsh words for his toughest competitor, Calgary-based WestJet Airlines Ltd., as well as Nav Canada, the corporation responsible for air traffic.

Mr. Leblanc accused WestJet of using corporate espionage to undercut his operations, and blamed Nav Canada for trying to seize some of his planes even though he insisted Jetsgo was not behind in its payments.

Mr. Leblanc said his other priority, besides safety, was to ensure all his 1,350 ex-employees got paid up to the time of the shutdown.

Mr. Leblanc denied speculation by analysts and the media that Jetsgo was the author of its own demise by setting prices too low to be viable.

He said every time Jetsgo tried to raise fares, it was undercut by WestJet and Air Canada.

“We have only 10 per cent of the market; it's not us who lead the industry,” he said.

[Jerricho]

and blamed Nav Canada for trying to seize some of his planes even though he insisted Jetsgo was not behind in its payments.

He can insist all he wants. :rolleyes: $1.6 million owing was the last figure I heard from the powers that be.

[North of Somewhere]

My friend at the tower tells me Nav can allowed him up to 4 Million. He owes 5.6 million and in this mans that in his twisted mind that means he only owes 1.6 million. And I hear Nav Can was thinking about taking some airplanes because of these numbers.

May this man rot in H%$ for what he has done to almost 10 persons I know who are all out on the street because of him.
:mad:

[click]

Is he for real? This guy's not playing with a full deck...

He said every time Jetsgo tried to raise fares, it was undercut by WestJet and Air Canada.

Yeah, no kidding there Michel! :yuk:

[CargoOne]

Well, 15x F100s are really good assets, but are they fully owned?