Penticton greets WestJet with open arms and cash

[teacher]

I'm posting this here because it affects more than 1 airline. Anyone else find it funny that Air Canada is always accused of being subsidized yet WJ has been taking subsides from communities for years in order to start operating out of certain markets. So AC pays the bills and WJ offers cheap fares? I wonder how long it'll be before the landing fees go up for AC to cover the loss. As if being un ultra low wage airline wasn't enough, they get $100,000 just for showing up.

Penticton greets WestJet with open arms and financial incentives

by Joe Fries - Penticton Western News
posted Apr 12, 2014 at 3:00 PM— updated Apr 12, 2014 at 4:12 PMThe first WestJet plane into Penticton landed on Saturday and was promptly parked inside City Hall.

Mayor Garry Litke took delivery of the scale-model aircraft from WestJet Encore president Ferio Pugliese, whose company will provide once-daily, round-trip service between Penticton and Calgary starting Oct. 26.

Pugliese and dozens of other WestJetters visited Penticton for a formal welcome at a community volunteer appreciation event in Gyro Park a day after the long-awaited route was announced.

While the airline boss said previously that community support helped persuade the company to service Penticton, WestJet Encore will also receive financial incentives to land here.

Litke confirmed the city has committed to spend up to $100,000 from its tourism marketing budget to promote the new service in its first year.

“We did the research and that’s (WestJet’s) standard practice. And fair enough: You have to have some skin in the game because our commitment to them is to fill the flights, to make sure when those planes leave the ground there are enough passengers on it that that flight becomes viable,” Litke said.

The mayor noted he’s had discussions with the Thompson Okanagan Tourism Association and neighbouring politicians and is confident they will help foot the bill.

“There will be, I’m sure, a willingness on the part of all the communities to share the responsibility for that financial commitment,” Litke said.

He also confirmed the city is negotiating airport costs with WestJet and is likely to waive the $300 landing fee, which would amount to $109,500 annually.

Pugliese would not confirm details of the incentives.

“We don’t talk about the arrangements we have with the various communities, obviously for competitive reasons,” he said.

“But it’s not unusual for us to work with communities directly and airport authorities… and the whole idea behind that is we enter the service, it allows us to get ourselves established, and that gives us the opportunity to grow.”

City resident Brooke Nowak was among the WestJetters who took part in the Gyro Park reception and then went into the community to generate buzz, and said she’s looking forward to commuting from Penticton instead of Kelowna.

“It’s kind of a long morning to get to work…. It’s beautiful, but it will be more beautiful once I have to drive just 10 minutes instead of an hour,” she said.

Nowak, a flight attendant for 11 years, was acknowledged for her efforts lobbying WestJet bosses for the new service.

“I’m part of this community,” she explained. “We’re a big team, a big family (in Penticton), and that’s what WestJet is, so it’s kind of just aligning.”

http://www.pentictonwesternnews.com/news/255040561.html

[tincanflyer]

Where's the cash you talk of?

I see incentives but no mention of cash?!?

Maybe change the title to reflect the truth and even the articles title.

[freakonature]

I'm sure the City will offer the same incentives to the other airline that has suported the City for many years?

[teacher]

Cash not collected is cash given.

[oldncold]

sometimes those incentives are guaranteed purchased block of seats eg; reserved 3 seats per flight the feds do the same in the north

[BE20 Driver]

Teacher - last I heard, you were flying the machines, not counting the number of peanuts on board. Only the AC accountants know what fees and taxes AC pays. How many destinations does AC and Jazz fly to? Of all of those destinations, you can't tell me that not one of them is subsidized by any form of government?

Penticton was interested in having an airline connect it to Calgary. WestJet probably saw some potential and ran some numbers but fell short. The city decided to drop some fees which probably equates to an extra seat or two of sales which put WS over the top for their projections.

Hate to be the one to break it to you but businesses (airlines and other industries) do this sort of thing all the time in the free market. I used to fly medevacs in Nunavut and do you think they were paying landing fees to the government up there? No. It was a part of the agreement they made when they initiated the service. You can bet that AC will negotiate some sort of deal when they renew service agreements at every airport.

[teacher]

Maybe, maybe not. Last I've heard AC never got a government subsidy to start a new route and advertised it in the news paper. They did however get told they had to continue servicing money losing routes for years at a set price.

Just pointing out that it's WJ once again being subsidized by taxpayers, not AC.

Once AC is no longer required to have their head office in the highest taxed jurisdiction by law, no longer has to abide by the official languages act printing every memo and manual in both official languages even where few if anyone speaks french, forced by law and threat if lawsuit to crew certain flights by "french qualified" staff and no longer have to abide by the Air Canada participation act we can call things even. Last I checked AC was no longer a crown corporation but a public ally traded company and should be treated as such.

I understand that business is business but this is one nice double standard.

[Realitychex]

The incentives, usually in the form of marketing dollars, are available at countless airports in Canada when an airline, any airline, starts a new non-stop route.

There's nothing to see here.

Move along.

WJ can never be accused of not paying its bills. I'm not sure the same could be said for any airline that has gone through CCAA / Chapter 11.

[teacher]

The incentives, usually in the form of marketing dollars, are available at countless airports in Canada when an airline, any airline, starts a new non-stop route.

There's nothing to see here.

Move along.

WJ can never be accused of not paying its bills. I'm not sure the same could be said for any airline that has gone through CCAA / Chapter 11.

Touche.

But than again, WJ wasn't made to pay someone else's bills either in the form of a forced merger of a competitor. Don't get me wrong, AC is no saint. Again, the double standard is strong with this one.

[Realitychex]

Bankruptcy proceedings allow companies to walk away from a lot of unpaid bills, regardless of how they were incurred, including the airline you mentioned.

I would imagine all airports, including YYF, were left holding the bag as a result of various airline bankruptcies over the years.

As you know, WJ has never left any airport holding the bag and has had to pay higher airports fees as a result of airports having to make up the differential from banco deadbeat airlines.

That differential wildly exceeds any perceived "subsidies" WJ has received from a handful of airports over the years.

The moral here is perhaps to not throw stones in glass houses.