Canadian restrictions on Emirates “complete and utter nonsense”

Following the restrictions imposed on Emirates flights to Canada, the carrier’s president has lashed out saying its “complete and utter nonsense”. Reuters reported that Canada placed restrictions on Emirates earlier this week, limiting it to only three weekly flights to the whole country. The restrictions were fuelled by the Air Canada Pilots Association who believed if Ottawa allowed Emirates to expand in Canada, Air Canada would be forced into bankruptcy and its airline partners would be hurt. “The notion that a few extra flights a week to a destination that the national carrier doesn’t even choose to serve will have any type of impact on their bottom line is clearly ludicrous,” said Emirates President Tim Clark on Wednesday at the Economic Club of Canada Clark told The Globe and Mail that Emirates was a fair competitor against Air Canada and its partners, adding that the flights would help boost tourism and trade to the country. "Opportunities are being missed simply because the transport options are not there” With hopes to introduce services to Calgary and Vancouver, Clark urged Ottawa to approve Emirates Toronto-Dubai flights to more than three weekly flights. On the other side of the argument, Air Canada spokesman Peter Fitzpatrick said the direct flights would not provide mutual benefits as Canada did not receive much traffic from Dubai and Canadians often just used Dubai as a stopover destination. “Air Canada has always said it supports liberalization and open skies agreements with the provision that they create a level playing field and make sense for Canada” said Fitzpatrick. “There is no reciprocal benefit to Canadian carriers or Canada. There has to be advantages for both countries.”

Read more...

Air Canada goes soft, woos travellers with pillows, pets

Air Canada is undoing rules designed to improve its efficiency but that ended up alienating travellers, and will now strive to be kinder to people and gentler on pets.

Chief executive officer Calin Rovinescu is developing the new strategy aimed at softening Air Canada's reputation for taking a hard stance in dealing with consumers. He plans to ease restrictions on pets and sports equipment, pare some extra fees and bring back pillows and blankets.

Mr. Rovinescu, who replaced Montie Brewer as CEO on April 1, wants to simplify a system of ticket pricing that left travellers complaining about being nickeled-and-dimed in recent years.

"Calin has made it known to managers throughout the organization that he wants to reverse customer-unfriendly policies that have been instituted over the last few years," a senior Air Canada official said. "It's a repudiation of policies under Montie Brewer."

Montreal-based Air Canada is reviewing its pet policy. Within weeks, it may allow dogs, cats, rabbits and birds back in the cabin, as long as the weight of the container and pet is less than 10 kilograms and fits under the seat in front of the pet owner.

Calgary-based WestJet Airlines Ltd. still welcomes pets, touting itself as an animal-friendly airline ever since Air Canada banned pets from the cabin in 2006.

The proposed changes are part of an internal review Air Canada is undergoing as it faces a cash crunch, declining passenger loads during the recession and fierce competition from WestJet. Industry analysts have speculated that Air Canada could be headed for another court-supervised restructuring.

At its annual meeting today in Montreal, Air Canada will play the patriotic card, raising the profile of its red logo with the maple leaf in the centre. The logo was relegated to a supporting role when the carrier emerged from bankruptcy protection in the fall of 2004 and pop star Celine Dion helped usher in blue as the dominant colour in marketing campaigns.

"We are a classic brand with stature," Air Canada chief commercial officer Ben Smith said in a recent message to employees.

Air Canada could also relax rules on sports equipment, possibly allowing skis, snowboards and other items to be checked in without charge, over and above transporting two bags.

A $25 service fee charged to customers who booked through the airline's call centre has already been scrapped, and an optional travel assistance fee of $25 to $35 one-way, named On My Way, also "appears headed for the dustbin," a senior official said.

As well, a $2 "comfort kit" consisting of an inflatable plastic pillow and polyester blanket that was introduced in 2005 has fallen out of favour. Regular pillows and better-quality blankets could be restored for certain longer-haul routes within North America.

Mr. Rovinescu also wants to improve relations with travel agents. He met last week at Toronto's Canoe restaurant with a half dozen executives representing travel agency chains that account for $1-billion of the airline's revenue, or 9 per cent, and pledged to improve partnerships with agents.

Other changes being contemplated include increasing the number of Aeroplan miles awarded when taking flights. And bags may soon be transferred for Air Canada passengers connecting to foreign airlines.

For instance, Air Canada customers flying from Toronto to London's Heathrow and then on to Morocco would have their baggage transferred to a Royal Air Maroc flight from London to Morocco.

In the Eastern Triangle of Toronto-Montreal-Ottawa, the airline is poised to reinvigorate its Rapidair brand. Rapidair flight frequencies could be beefed up as Toronto-based Porter Airlines Inc. expands in the region.

AIR CANADA (AC.B) Close: $1.80, up 40¢

BRENT JANG From Friday's Globe and Mail May 8, 2009 at 6:42 AM EDT

Read more...

WestJet unveils service guarantees

WestJet Airlines Ltd. unveiled a new list of customer-service guarantees today as part of an aggressive new marketing campaign aimed at winning market share from Air Canada and staving off the need for the proposed passenger bill of rights now before Parliament.

The campaign launched this morning sets in stone what the airline will offer its passengers on day-to-day basis and in the event of delays or cancellations.

Many of the so-called "care-antees" are already part of the airline's regular operations, including services such as two free checked bags.

Others entrench practices that were, until now, discretionary, including providing meal vouchers for passengers delayed by more than two hours and hotel rooms for those delayed overnight.

But they also include some new services, such as a cash-back guarantee for a cancellation made within 24 hours of booking it.

Bob Cummings, WestJet vice-president of guest experience and marketing, said the campaign is aimed at giving the carrier an edge over its competitors in an increasingly aggressive market for air travel due to declining demand.

"We have a smaller pie this year with respect to demand and revenue," Mr. Cummings said. "We had to look to way to steal more share."

The move comes on the tails of an apparent shift in strategy at Air Canada under the leadership of its new chief executive, Calin Rovinescu.

Until now, Air Canada has been scaling back its capacity to ensure it was flying its planes full and profitably. However, Mr. Rovinescu has said in a series of recent internal communications that he doesn't adhere to the strategy of "shrinking to profitablity."

"I don't want to lose market share to our competitors without putting up a fight," he said in a video to employees that was posted on YouTube.

Air Canada is looking for creative solutions to compensate for declining demand, he said, including leveraging its frequent-flyer partnership with Groupe Aeroplan Inc. To that end, the carrier announced last week it had sold an additional 250,000 seats to Aeroplan this year to help fill its planes.

But WestJet is not aiming its new campaign at just Air Canada. After a particularly difficult holiday season this past December due to harsh winter weather in Vancouver, a private member's bill was presented to Parliament proposing a Passenger Bill of Rights be established in Canada.

Among other measures contained in the bill, carriers would be forced to pay hefty financial penalties to customers for delays or cancellations.

"We believe we have a market-driven solution that addresses each of the areas that is proposed under the bill," Mr. Cummings said of the campaign.

Still, the new guarantees are not without their risks. WestJet incurred $5.3-million in additional expenses in the fourth quarter related to the storms in Vancouver, including covering the cost of meal vouchers, hotels, ground transportation and charters for its affected customers across the country.

Heading into the busiest time of the year, at a time Air Canada is set to renegotiate all of its labour pacts, WestJet's network runs the risk of being overwhelmed by a job action at its domestic rival.

In addition, there is a risk this might occur if Air Canada were to file for creditor protection, as some have speculated.

"It simply could not replace Air Canada's capacity," said Chris Murray, CIBC analyst, in a recent note to clients. "In a strike or lockout situation, we expect we would see what happened at Vancouver replicated at every major hub across the country."

Scott Deveau, Financial Post - scdeveau@nationalpost.com

Read more...

Japan and Canada expand Air Services Agreement

February 2007, Canada and Japan have just announced an expanded air services agreement between the two countries. Promises to passengers of increases to flights, greater route flexibility, and enhanced commercial ties are offered up in support of the agreements that have just been made.

Two years forward and in February 2009 Air Canada is operating a single daily frequency between the two countries down from three, having abandoned Osaka and prior to the earlier announcement having withdrawn from Nagoya. Japan Airlines similarly has reduced frequency between the two countries.

Here we are in April 2009 and a new bilateral air transport agreement is announced with similar promises being made.

Can the airlines of Canada and Japan work to achieve a reinstatement of services to provide a platform for growth and development?

For an innovative commercial airline that can make the right marketing investment for the long term the evolving bilateral presents a great opportunity. Access to unlimited services outside of Tokyo, extended reach through codeshare provisions, access to Tokyo's Haneda airport, and an increasingly liberal pricing regime. In addition, the maximum return on Canada's portfolio of slots at Tokyo's Narita airport remains to be achieved.

Read more...