Seattle, gateway to Whistler
 

There is finally mounting pushback against Canada's Air policy

This is testimony in front of the Canadian Senate,

Highlights:

Rob Howard, Member, Provincial Lead of the Air Access file, Legislative Assembly of British Columbia

As I have said, air access is critically important to my province and our nation, and it is urgent that we take steps to allow expansion of air services, passenger and cargo, especially through the Pacific Gateway. In these times of need for job creation and job protection, expanded air services offer a low-cost, low-risk, high-reward way to grow and diversify our economy, allowing us to reach our full potential, so I will present some short-term or immediate recommendations and some long-term recommended actions.


As we think about this, I ask us to keep a couple of principles in mind. The first is to view this issue through more of an economic lens. Right now, I think air access issues get tied up in Foreign Affairs and International Trade, Transportation and CBSA. Many different departments have an interest in the file. I understand that, but sometimes you lose sight of the big picture, and the big picture is economic development, growth, diversification and jobs. The economic lens is the first guiding principle I would encourage all of us to keep in mind.

Second, the process needs to be a little more open, in our view. Right now, negotiations happen behind closed doors. These are negotiations on the air service agreements. The agreements do not see the day of light, as contrasted to the U.S., where you can Google them and they are online.

As stakeholders, we do not always have a clear idea what is being negotiated and why. The term “national interest” is used a lot, and I think everyone understands that. What is national interest? Is it 5 per cent commercial and 95 per cent community, or is it 50/50? Does it change from time to time? We just do not know, and it does make it difficult for stakeholders to plan and to attack the file with a greater sense of purpose.

As we look to increase our dialogue on this file, the Blue Skies Policy was introduced in 2006. It is up for its five-year renewal, and we are asserting — asking as loudly and as clearly as we can — that stakeholders and our government have a real, genuine opportunity for input.

On the short-term list as well, you will see under “Bilateral ASAs” that we are talking about removing capacity restrictions with Taiwan. I do not think I gave this to you, but I will leave copies. We just collected a series of letters from business and organization leaders from the Taiwanese community in the province to underscore that there is pent-up demand on both the passenger and the cargo side with Taiwan.

I wanted to give you a few examples of what life is like on the airport street out in British Columbia and some examples of where we have not had success and we should be able to have success.

Singapore Airlines flew into YVR for about 20 years. They came three days a week. For them, it just did not make sense. It was kind of like operating a hotel three days a week and there were not enough options for their business travellers. They wanted to come daily. They pursued this with their federal government for a few years. They got turned down, and eventually tired of asking, they left. They pulled their service. Now I guess that traffic comes either through San Francisco or Los Angeles, but it is big loss to the community.

I know Emirates evokes some emotion, but Emirates is just another example. It wanted to come. It was just a direct, non-stop drop-off. There were no beyonds or infiltration into our system. They were told no. They went to Seattle to set up. Part of their marketing program calls themselves the “gateway to Whistler.” That almost brings tears to my eyes because that should not be allowed to happen. That is hurtful, and it would cost YVR between 20,000 and 30,000 seats per year.

I have already talked about Taiwan. There is pent up demand for cargo, and there is a lot of anecdotal evidence, even in my office. My office staff fly back and forth. I guess it was last May; they had to book in September to get a single ticket.

I want to speak about Air France briefly. Air France wanted to come for years. They could not. They set up in Seattle as well. Now they can come because we have signed with EU, but they have capital, people, networks and dollars invested in Seattle, and I do not know if they will come back. There are other stories.

I want to make it clear, too, that we are not talking about cabotage; we are simply talking about beyond rights and more access.

Full article

Transport, Evidence, March 28, 2012

Excellent post Far Rider:ok:

Protectionism won't work. It just delays the inevitable.

Sorry but don't agree. And don't agree that it's protectionism either. If you have plane loads of emirati's... By all means come as much as you want. 10 flights a day. Otherwise it's the same old story... You guys want to eat other peoples lunches to benefit yourself.

Singapore: not enough pax for every other day-so how would daily make sense?

Taiwan: China Airlines and EVA(code share with AC) fly heavies Daily.

Lots of other major carriers sharing the pie.... LOTS. Canada just doesn't like what the UAE is trying to do. Period.

The market is open to sharing... But just looking for the right Partner. That's just the point...the UAE doesn't want partners. The want it ALL.

Freedom rights
 

I'm not sure which version of the freedoms (5th 7th 9th) are involved here...is it possible to post it here...specifically Cathay Pacific rights from HKG to YVR and on to JFK...are they able to take on pax from JFK to YVR and YVR to JFK, what about freight? Or do they just use YVR as a tech stop? It may have some impact on the denial of increased right to EK, and EY...thanks...LC

So by your reckoning, the only pax AC takes from its YYZ hub should be Canadians. As well, LH shouldn't be funneling pax through FRA to anywhere in its global network?

The market isn't open to sharing: AC and LH sure aren't interested. The sharing of the pie is only by a limited few, not really LOTS. Dubai has 120+ airlines flying through DXB so I wouldn't say they are keeping it ALL.

When you say Canada doesn't like what the UAE is trying to do (whatever sinister plot that is); you really mean the Harper government at the behest of AC. This is not necessarily true for Canadians.

Oops! Double post.

Thanks Skiing. I believe your statement to be an oversimplification.

Canada has always been known to be fair and politically correct. Perhaps there is a small amount of pride in the national carrier to give it a fighting chance against others with different advantages, however it was never insofar as to be monopolous. No one can say the UAE has been denied access as they have heavy flights daily to the Canadian hub already. They were only denied MORE.

And if I am wrong - and you are right then why was Qatar given landing rights after Emirates denied?

555,

Just to be correct, Emirates does not have daily flights to YYZ. They only have 3 per week. Yes they would like daily to YYZ and also YVR and YYC.

Looking at the route structure AC has access to with LH and the Star Alliance they have daily access to Dubai India and Africa. EK would be offering an alternative to passengers for those same destinations. Why is the government denying alternative choice for pax and goods to/from these regions? Who benefits most from this policy? I would suggest the only real beneficiaries are AC and LH.

With all the Tim Hortons popping up in Dubai, there must be enough Canadian content to support more traffic! ;-)

Regarding Qatar, it is a different country altogether; separate airline and bilateral.

Your talking semantics skiing, and that's not a good basis for your argument in my opinion. EK-EY are seen as one in the same to the market. You are an hours drive apart, and essentially serve the same market. Because you divided the 6 flights per week between you is totally up to the govt of the UAE. Qatar is largely seen as serving the same market as well, being an hour flight away, so i believe my point stands.

I cannot confirm this, but I personally believe Qatar was given rights over the UAE because firstly Qatar didn't have a piece of the pie yet, and second, Canada didn't like the way the UAE was trying to hold Canada hostage with the military base issue.

It seems to me the flights were and are there to be had, and we're given to others.

Qatar has the same intentions as the UAE when it comes to expanding their airline... And being geographically so close, and having such a similar footprint in terms of overall dynamics... The question still stands... Why give the flights to Qatar over EK-EY?

I appreciate the views of aviation professionals and even those who represent the interests of airports, they are of course important finacial enterprises but what really turns out wicks up when Seattle boasts that is the gateway for Whistler (where I live) is that it actually isn't.

And that is the point.

Sitting in Europe and contemplating a ski holiday, offered access to Whistler through Seattle I would plump for Colorado via Denver or somewhere else I don't have to sit on a coach for seven hours after a ten hour flight.

Sure, I resent Seattle being easier than YVR. And just how much easier? Well, I am in Vietnam at the moment. We flew from Seattle. We drove for six hours, stayed a night in hotel, twice, once each way, and still came out a good couple of hundred ahead on the travel cost.

I'd rather drive less, I'd rather spend my night in Vancouver, I prefer YVR as an airport but I saved a bundle and got two "free" nights in Seattle. It should be easy. Book your flight from your nearest major airport, but thousands, many, many thousands of people like us are flying from Bellingam or Seattle and even more are taking their holidays elsewhere and saving a bundle because of the cost etc and limited access through YVR.

Cutting our own throats, really.

555,

Well I guess I missed the point of your post to which I initially replied:

To me that indicated the position taken by many, that EK/EY and/or Qatar should only be allowed point to point traffic. Was that an incorrect understanding of your statement?

My point is that AC/LH and many other major carriers operate hubs and funnel pax from multiple points through these hubs to many downline destinations. In fact AC is proud to state how much business they are getting from US pax flying though YYZ to international destinations. My question to you is, why should it be considered an unreasonable business practice for some select carriers to do the same?

If one was in Europe contemplating a ski holiday in North America via ANY Middle Eastern carrier, it would not be a "seven hour coach ride after a ten hour flight". The flights would first need to go through Dubai/Abu Dhabi/Qatar (about 7-8 hours), and then (using EK as example) transfer to a 14-15 hour flight to Seattle. Clear US Customs. Then the 2 hour ride to the border. Clear Canadian Customs. Then the 2 hour ride to Whistler. All assuming good traffic and weather, of course. Hope that's worth saving "a couple hundred". What's a lift ticket at Whistler these days, anyway? Costs aside, I'm not really sure how Seattle via the ME is "easier" than YVR, coming from Europe?

No one considers it an "unreasonable" business practice to funnel pax through their hub to another destination. It's a more fundamental question of how does a developed western nation with all of the costs associated, compete with a developing nation unhindered by similar costs? The answer is, they can't...any more than Nike can make shoes cheaper in Oregon than they can in China. So they (AC, or other legacy carriers) do what they can to protect themselves with regulation. Eventually it will collapse, no doubt, and the consumers will get their cheaper seats, and the workers will get their lower wages. And a few people (like the very highest management in EK) will get extraordinarily wealthy, and everyone else will make a pittance.

It's the Walmartization of the airline industry. No one cares, until it kills THEIR livelihood.

If you're going to compare apples to apples, at least all of the legacy carriers I can think of flying internationally also have a strong domestic presence in their home country. Emirates is a parasite, existing SOLELY to siphon traffic from everyone else's markets.

Bingo. And this was from one of our "allies" in the region.

In terms of Seattle being easier, I believe what the writer was referring to was that for him, as a Canadian living in/near YVR, it is significantly less expensive to fly out of Seattle, likely due to the costs imposed upon canadian travellers by the government and air canada's high cost structure. Plus the lack of competition on international routes.
I've heard some people from my hometown of winnipeg drive down to grand forks, north dakota because they can save a significant amount of money vs flying out of ywg on ac or wj.
Same for southern ontarians using buffalo as a gateway airport vs pearson.

If you're going to compare apples to apples, at least all of the legacy carriers I can think of flying internationally also have a strong domestic presence in their home country. Emirates is a parasite, existing SOLELY to siphon traffic from everyone else's markets.



Maybe you could propose a domestic route structure for the UAE airlines. Have you even looked at a map?

Emirates does have an extensive network in the region; routes of 40 min to 3 hours.

I guess, by your reckoning airlines like Singapore and Cathay fall into the same parasitic category?

Or even BA or LH or LX for that matter.. sure a few small aircraft doing a very small domestic market..

I would not consider Singapore or Cathay "legacy" carriers and yes, I would put them in the same category as Emirates. And I'm quite aware of the geography and culture and employers of the UAE, having lived in Dubai for over seven years. That was my point, they were created to take traffic from other markets because they have none of their own.

But back to the debate about unfettered access to Canada's airports by foreign carriers. As long as we have something they want, they should be paying for it. Not giving it away for free. Simply because it would make someone's ski vacation easier or whatever.

So now the only airlines that should be allowed to exist are legacy carriers with a large enough geographical size to have a sizable domestic market?

I don't think we are discussing "unfettered" access; just increased access.

Who would they have to pay for this access? Air Canada I presume.

In the mean time those individuals and businesses not part of AC, that could benefit from more travel options are s.o.l.

Making someones 'ski vacation or whatever' easier should be a consideration. Tourism is a vital part of the Canadian economy and it is already underdeveloped so easier travel would be a benefit.

I think Rob Howard's presentation to the Senate Committee addressed it quite clearly.

Skiing: can you please give me an example of some of EKs domestic flights?
Thank you.

Gentlemen,

Regarding Cathay, not only do they share the pie through One-World, but they serve the largest population in the world. china. Or did you miss the succession?

BA has a huge domestic market of travelers, and also shares with other airlines through Skyteam I believe.

Singapore: same thing, but to a lesser degree. And did you miss your own posting that they scaled back their flights?

I never said they had a domestic network. In fact I said just the opposite.

nolimitholdem said:
To which I replied:
My point being that while they don't have a 'domestic' network they do have a not unsubstantial short haul 'regional' network serving Qatar, Bahrain, Saudi, Kuwait etc.

555, in order to 'share the pie' an airline is required to be part of one of the alliances? When was it determined that these alliances were sole servers of 'the pie'?

It is this idea that the legacy carriers have some 'right' to the travelling public and that the rest of the world must conform to their established structure I find hard to accept.

At any rate, despite the struggles of the west and especially Europe, much of the rest of the developing world has growing passenger numbers and the likes of AC and LH couldn't handle it all by themselves. Since Canada wants to engage more economically with some of these regions, increased transportation links are inevitable.

You know what, when it does happen, it won't kill AC contrary to the chicken littles out there. If AC goes the way of the Dodo, it will be mostly their own doing. Hopefully they get their s**t sorted out.

Thanks Skiing.

... For helping me with my point.
So it seems EK doesn't have a domestic market at all. They are serving And benefitting themselves at the behest of their neighbors. And I'm curious why you conveniently left out India? Let's not forget S Africa and every other country in the region. God help you if the Indians alone decide they want their share back. Lol, I have seen the pax you have out of any NAmerican city. It's almost 100% Indian.

The point is there is not enough "domestic" UAE traffic to give MORE flights to EK. Again in reiteration, no one can say Canada is not sharing the market with you already. It was just determined that it's probably more fair to give the rights to some of these other counties.

Of course every airline has a certain percent of foreign traffic. Again - semantics.

You say AC has to get its "----" together. From where I stand i have more respect there than EK. And NO, I don't work there. I would defend them before any ME airline. They struggle because fortunately for the Canadians, labor law income taxes and human rights etc take a greater portion of the equation. But that's not new to any western country. You might be padding your bank account working over there, but from what I read, you are paying for it.

Tell me, where do you think EK would be if it didn't have oil in the region? If the Emiratis actually had to work for their money like everyone else?

And another spanner in your gears: you say you serve Qatar? And yet complain that EK isn't given more landing rights in Canada, yet Qatar airways did get Some of the extra landing rights you wanted? How come?

The alliances are just an example of how companies share and do business together.

The alliances are an example of how crappy airlines eliminate the need for improvement through the elimination of competition, and also can control and manipulate the fares on certain routes that they control completely.
Check the fares on routes to Europe that AC/Lufthansa control exclusively vs routes that they compete with others on, on a site like expedia. No wonder they're terrified of EK.

555, you say

I was referring to their local regional routes as a loose comparison to a domestic market. Of course India is a significant component of EK's business. As is Africa. One wonders why AC is not more open to serving these emerging markets. Maybe that is a question you can answer for me?

It seems to me it is because they are restricted by their Alliance partners and not free to make independent business decisions.

Actually quite the opposite; I was paying a higher price in Canada. No, I am not just referring to taxes. I no longer worry about my job because of the health of the airline I work for. My family is happy. My kids are getting good education and we have the opportunity to see parts of the world that would not likely be possible from Canada. I enjoy my job overall; I like the airplane and route structure. No, it is not perfect but what situation is?

Truth is, oil accounts for less than 6% of Dubai's GDP and is decreasing. Believe what you want about EK but it wouldn't account for their ability to fill their a/c like they do. Like WJ, Ek has done a very good job of marketing themselves and they provide a good product that pax seem to enjoy.

At the same time, Canadian energy sector accounts for 6.8% of its GDP.

It still comes down to the same thing: protecting AC and trying to convince everyone that it is done in the best interest of all Canadians. I simply don't buy it. As I stated earlier; I think Rob Howard's presentation to the Senate Committee addressed it quite clearly.

Alliances are only a way competitors get together to be more competitive against other who are doing the same gmc. Partnerships are a good way to do more business, not less. Just like EY is doing with Seychelles, Air Berlin, and Virgin.

Skiing, any measure short of total free trade does not equal market protection. For most countries... (I say most because it's in some companies overall strategy not to partner) ... The balance lies somewhere in between. You have to be smart and not only open competition to the right people, but also in a balanced progressive way. Ie: not all at once. Think of it this way: your gonna have a race. You drive a Prius, and te other guy has a mustang. Your not really in a position to compete are you? Rob Howard's presentation fully and completely misses this point and is just stupid because of it. It actually does a disservice to the country. In the end, Canada's leaders and thankfully most people are smart enough to know it and that's why we are where we are.

Ps, I'm glad your happy over there. there's no denying its a decent job. No job is perfect and there are different specific issues everywhere. EK would be one of my first choices if I was looking.

BA= One World..

As a Canadian working abroad, even when I am home I will drive to Bellingham or SEA to pick up a Zed fare to US. Taxes from Vancouver almost $80 a head more.. X family of 5.. well.. you see why I'd drive an hr to Bellingham and park FREE. 2.5 to SEA.. last such trip recently to Hawaii.. Sure AC has a nonstop.. but sh*t service and extra 400 in taxes? Not a chance.

555,

True, but the flip side is also true: it doesn't have to be a totally closed market for protection measures to be in effect.

Also true, but if I show up to a race in a Prius it is not the fault of the Mustang driver I am at a disadvantage.

A phased in approach is a very good strategy as long as the time provided is used to upgrade the Prius. If not, the spectators don't get to enjoy a good race. Nor do the drivers.

Maybe Rob Howard's briefing did not address the issue completely. Total disregard, however, of the benefits of increased air transportation (not just EK/EY) to other sectors of the Canadian economy also misses the point.

If Canada's leaders are, in fact, smart they would be assisting AC and the rest of the Canadian industry to be more globally competitive. They would treat this industry as an economic asset instead of a cash cow to be milked to death. I think most recognize this to be true as well and that we shouldn't have to be where we are now.

Thanks for the well wishes. It is always good to not have to be looking for a job!

Skiing, are you kidding?

There is no flip side skiing as there is no "total market protection" in this case.

One of the comparative disadvantages financially to any company in Canada compared to ME to which I'm referring to would be civil rights. It's an advantage for the citizens, but costs the corporations financially a bit more. If you put a sweat shop in China against a factory in Canada trying to make shoes, of course it's not balanced. It's not competition. Strange that you don't see it that way.

Spectators? You got to be kidding right?

Ron Howard: Again, there is no "total disregard". Lots of Airlines coming to Canada including 2 major carriers from your very small country already.

Cash Cow? AC is is not a cash cow period... And certainly not for the govt. Maybe The shareholders? Guess what... AC is a public company. how about you?

Competition? ! There is more now that Canada decided to spread the ME traffic around by granting Qatar.

Clearly, you are missing a lot of facts here, as did Howard.

Do you have any real facts to base your arguments on... Maybe you should take Howard and go skiing instead. Oh wait: you can't. PS, I think your just sugar coating....
Heard your bonus rules will change as the govt wants to keep more of your bonus for themselves? Nice that they can just change stuff on you.

AAI... Good for you. You saved a buck. FYI: Another eg of COMPETITION to those who say there is none in Canada.

555, do you even read my posts before you go off?

Did I say there was? No.

Well, you started the analogy about car racing.

Again, if you took a moment to read what I posted, I said . No, I am not publicly traded; my wife prefers privately held.

As many 'facts' as you have brought to the table. This is a debate mostly of theory and ideology. If it was clearly defined by irrefutable 'facts' there would not be a discussion.

I can go skiing, anytime. It isn't really very good, but I can go.

So is the wish to think I am lying about my life satisfaction just anger based because I don't agree with you?

@ 555 Orange Qatar doesn't have more landing slot that the UAE. 6 each my understanding :)

Just to note that it can go both ways. Next week I am flying IAD-YYZ-CDG in J class. TATL is on AC. Over $1500 cheaper than using UA IAD-CDG. So even within Star Alliance there can be some competition.

Thanks Seenit all. There you go.

Thanks Chuck. Precisely. It was more fair to spread out the pie instead of give it all to EK. Skiing is sore about it and thinks its all market protection and ideology and theory. A conflict in itself. Lol. Now he's just taking an opposing positions everything with no substance as he argues from a position of weakness. Hence his response to AC being a public company, for eg. Regressing. So really it's not much of a debate. Arguing for the sake of arguing is no argument at all.

Anger has nothing to do with it Skiing. Are you sensitive on the topic? I just enjoy the debate. I know where I stand on it, and your entitled to yours too. You want emirates to have more flights to Canada right? And it's aaall about market protection... And the next day Qatar gets more rights. So... Right-... Next.

This debate is not on theory or ideology. But the fact that you believe so says everything.

Seattle pretends it's like Vancouver...... but it's not.

I would never cross the border to fly out but then I fly staff. No idea how EK got into conversation.... or Prius.

Sore? Not really. Disagree with Canada's position? Yes.

Would I like to see more flights to Canada? Sure. So would Air France and Singapore. Maybe Westjet too since they benefit from onward connections.

So, 555, if this not about protecting AC but, in fact, about what is best for Canada/Canadians, perhaps you could tell me how more access would be harmful? Can you detail what sectors of the Canadian economy would be negatively impacted and to what extent? What would be the negative impact on individual Canadians?

Since the debate isn't theoretical, you obviously have irrefutable facts to support your side. I am looking forward to hearing them.

In the mean time, as you so generously have allowed, I will maintain my position on this.

I agree, Seattle is not like Vancouver. Unfortunately, SEA operates in a much less restrictive environment than YVR.

SEA is trying to capitalize on that greater freedom to attract airlines to fly there. It is marketing itself as a gateway for tourists to Canada, especially Whistler. EK is just the latest airline to go to SEA because they could not get any flights to YVR. Obviously, to some, that is good for Canada.

The Prius was 555's analogy for Air Canada vs a Mustang for EK. Which implied to me that denying more rights to EK was to protect a weaker AC. I guess I misunderstood the analogy because, apparently, Canada's policy position has nothing to do with protecting AC.

@ 555 orange. Sorry but I agree with skiing. The only one winning in this is AC no one else ie airport, business or the Canadian themself. :ugh:

In its most simplest sense, more choice is always good, but it's a diminishing return and often comes at the expense of something else. Just like dumping cheap Chinese stuff negatively affects local manufacturer. Its very convenient to look at it one dimensionally in terms of "choice" purely because it benefits you. *Its very ignorant. It's very simple and I'm always surprised when people just don't get it.*

Chuck, much of the traffic you want to access flies home westbound via Asia. That is just one eg of how the market is shared and would negatively impact.*

Gentlemen, in the end all players are granted access, there is no protection. It's just that within Canada, the powers decided that for now EK will only be granted through Toronto, and to apparently to SHARE the market further, Qatar was added to the market. Actually, I think EK screwed itself in this case by trying to force their hand with the Canadians. If it happens, I bet Qatar will fly direct Vancouver, not EK.*

The Americans are more desperate right now, and tend to have a lesser inclination to monitor a market while also allowing greater access. Hence what happened to them in Banking and Real Estate as opposed to Canada. In Canada you could never buy a home unless you had the income to support it. In the States, anyone was given a loan, because they falsely assumed the market would always go up. It was foolish and lead to where they are now.*

This is reality. This is Canada. We are open to your business, but we are responsible at the same time. Sorry if it doesnt suit you.*

There are a LOT of people out there then that don't get it when it comes to consumer goods and services. I am afraid to see you are dealing with reality.