New Air
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tonysoprano
- Rank 10
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Re: New Air
Airline newcomer complains of red tape turbulence
Scott Deveau, Financial Post
Published: Monday, March 31, 2008
The most notable new entrant trying to break into the Canadian airline industry says it's being weighed down by increased red tape at the Canadian Transportation Agency.
Tim Morgan, one of the co-founders of WestJet Airlines Ltd., says the agency's increased scrutiny over foreign ownership limits has presented a major hurdle obtaining a licence for his latest venture, tentatively named NewAir & Tours.
Mr. Morgan maintains that all 22 of the initial NewAir investors, who contributed $13-million in seed money this fall, are wholly Canadian owned - including the 10 corporations and trusts involved. But he said those investors have been subjected to an unprecedented level of scrutiny from the CTA - something he didn't see in the four other applications he has filed in the past decade, including WestJet's.
"What I'm concerned about is a bureaucratic institution creating rules as they go along," he said. "It's a concern because I need to start the rest of the process. This is simply holding it up."
Under Canadian law, foreign ownership in a Canadian airline is capped at 25% of voting shares. Upstart airlines, among other requirements, must provide legal documentation that their investors fall within those foreign ownership caps.
Up until recently, the CTA simply required affidavits from the applicant to that effect, according to Bill Clark, NewAir's regulatory council. However, more recently, the CTA "arbitrarily" began "climbing further up the tree," requiring affidavits from each individual and institutional investor, he said, including affidavits from each of their directors, and in some cases, even requiring that trusts do the same for their beneficiaries in order to establish de facto control of the airline.
Every investor is subjected to the same level of scrutiny, regardless of whether they are investing 1% or 100% in the airline, Mr. Clark said.
"This has happened since WestJet," he added. "I know this because I did WestJet's."
Ironically, the increased scrutiny comes at a time when the federal government is considering raising the foreign ownership limits on Canadian airlines to 49%, according to sources in Ottawa. In fact, one of the primary objectives of the Competition Policy Review Panel is to receive input from the industry to that effect.
Mr. Morgan says the newfound CTA rigor is not only onerous, but has tied up NewAir's application for nearly five months since the initial paperwork was filed. It is also putting pressure on Mr. Morgan and his partner's ambitions of having the airline in the sky in time to catch the tail end of the peak travel season this summer.
"Now if they have suspicion, or they think that someone is not Canadian, and they have reason to believe someone is not Canadian, I could understand them digging into it," Mr. Morgan said. "But people won't invest if the process is too onerous."
While Mr. Morgan said the length of the process has yet to scare off any initial NewAir investors, it is becoming a source of frustration for him.
Under federal regulations, the CTA has 120 days to render a decision after an application is filed. But that period only begins once the agency has all the documentation it needs to make a decision, according to Jadrino Huot, CTA spokesman.
"The CTA will take the time it needs to render a fair and equitable decision," he said. "We won't render a decision after 119 days if we don't have all the documentation in hand just to say that we have met that deadline."
But, he denied the CTA has made any changes in what it requires from applicants.
"It would be incorrect to say the test has become more stringent," he said. "It could be that their own structures are more complex with funds and trust funds, and individuals injecting money into it. So, that is why it may appear to be more stringent."
He noted that Toronto Island upstart Porter Airlines recently underwent the same level of scrutiny in its licensing process.
While Robert Deluce, Porter chief executive, acknowledges that the process was very thorough, he said it was not overly onerous. Nor was it the most difficult application process he has endured, he said, adding that process for getting Canada 3000 off the ground in the late 1980s was much worse.
"I didn't see the process as being any more difficult than anything we had been through before," he said.
Copyright © 2007 CanWest Interactive, a division of CanWest MediaWorks Publications, Inc.. All rights reserved.
Scott Deveau, Financial Post
Published: Monday, March 31, 2008
The most notable new entrant trying to break into the Canadian airline industry says it's being weighed down by increased red tape at the Canadian Transportation Agency.
Tim Morgan, one of the co-founders of WestJet Airlines Ltd., says the agency's increased scrutiny over foreign ownership limits has presented a major hurdle obtaining a licence for his latest venture, tentatively named NewAir & Tours.
Mr. Morgan maintains that all 22 of the initial NewAir investors, who contributed $13-million in seed money this fall, are wholly Canadian owned - including the 10 corporations and trusts involved. But he said those investors have been subjected to an unprecedented level of scrutiny from the CTA - something he didn't see in the four other applications he has filed in the past decade, including WestJet's.
"What I'm concerned about is a bureaucratic institution creating rules as they go along," he said. "It's a concern because I need to start the rest of the process. This is simply holding it up."
Under Canadian law, foreign ownership in a Canadian airline is capped at 25% of voting shares. Upstart airlines, among other requirements, must provide legal documentation that their investors fall within those foreign ownership caps.
Up until recently, the CTA simply required affidavits from the applicant to that effect, according to Bill Clark, NewAir's regulatory council. However, more recently, the CTA "arbitrarily" began "climbing further up the tree," requiring affidavits from each individual and institutional investor, he said, including affidavits from each of their directors, and in some cases, even requiring that trusts do the same for their beneficiaries in order to establish de facto control of the airline.
Every investor is subjected to the same level of scrutiny, regardless of whether they are investing 1% or 100% in the airline, Mr. Clark said.
"This has happened since WestJet," he added. "I know this because I did WestJet's."
Ironically, the increased scrutiny comes at a time when the federal government is considering raising the foreign ownership limits on Canadian airlines to 49%, according to sources in Ottawa. In fact, one of the primary objectives of the Competition Policy Review Panel is to receive input from the industry to that effect.
Mr. Morgan says the newfound CTA rigor is not only onerous, but has tied up NewAir's application for nearly five months since the initial paperwork was filed. It is also putting pressure on Mr. Morgan and his partner's ambitions of having the airline in the sky in time to catch the tail end of the peak travel season this summer.
"Now if they have suspicion, or they think that someone is not Canadian, and they have reason to believe someone is not Canadian, I could understand them digging into it," Mr. Morgan said. "But people won't invest if the process is too onerous."
While Mr. Morgan said the length of the process has yet to scare off any initial NewAir investors, it is becoming a source of frustration for him.
Under federal regulations, the CTA has 120 days to render a decision after an application is filed. But that period only begins once the agency has all the documentation it needs to make a decision, according to Jadrino Huot, CTA spokesman.
"The CTA will take the time it needs to render a fair and equitable decision," he said. "We won't render a decision after 119 days if we don't have all the documentation in hand just to say that we have met that deadline."
But, he denied the CTA has made any changes in what it requires from applicants.
"It would be incorrect to say the test has become more stringent," he said. "It could be that their own structures are more complex with funds and trust funds, and individuals injecting money into it. So, that is why it may appear to be more stringent."
He noted that Toronto Island upstart Porter Airlines recently underwent the same level of scrutiny in its licensing process.
While Robert Deluce, Porter chief executive, acknowledges that the process was very thorough, he said it was not overly onerous. Nor was it the most difficult application process he has endured, he said, adding that process for getting Canada 3000 off the ground in the late 1980s was much worse.
"I didn't see the process as being any more difficult than anything we had been through before," he said.
Copyright © 2007 CanWest Interactive, a division of CanWest MediaWorks Publications, Inc.. All rights reserved.
Re: New Air
Tue, April 22, 2008
NewAir trims cash goal
UPDATED: 2008-04-22 01:16:35 MST
By MARKUS ERMISCH, SUN MEDIA
NewAir and Tours founders have scaled back their fundraising target, but are still aiming to launch their fledgling airline in early fall.
Tim Morgan said yesterday he and his partners are trying to raise $50 million, down from the maximum $75 million the group had originally planned to raise.
Morgan, a former WestJet executive, said he and his partners have raised most of the money, but are "not quite there yet."
He said an official announcement, coupled with a sales launch, is tentatively scheduled for late next month.
Calgary aviation analyst Rick Erickson said it's not surprising NewAir scaled back their fundraising target.
While Canada's carriers have been relatively immune to the economic downturn south of the border and sky-high oil prices, airlines in the U.S. are suffering.
Several of them were forced into bankruptcy in recent weeks, citing high fuel costs as one reason for their financial woes.
"I think investors are just a little skittish and I think it's probably prudent on their part to scale it back," Erickson said.
The reduced amount, he said, may mean NewAir will start with fewer than three aircraft in the fall.
Erickson said NewAir has to start operations in the fall to cash in on the sunspot travellers. Plans are for the carrier to fly from underserved secondary markets to southern vacation destinations.
New Air is expected to go public in three to four years.
http://calsun.canoe.ca/Business/2008/04 ... 6-sun.html
NewAir trims cash goal
UPDATED: 2008-04-22 01:16:35 MST
By MARKUS ERMISCH, SUN MEDIA
NewAir and Tours founders have scaled back their fundraising target, but are still aiming to launch their fledgling airline in early fall.
Tim Morgan said yesterday he and his partners are trying to raise $50 million, down from the maximum $75 million the group had originally planned to raise.
Morgan, a former WestJet executive, said he and his partners have raised most of the money, but are "not quite there yet."
He said an official announcement, coupled with a sales launch, is tentatively scheduled for late next month.
Calgary aviation analyst Rick Erickson said it's not surprising NewAir scaled back their fundraising target.
While Canada's carriers have been relatively immune to the economic downturn south of the border and sky-high oil prices, airlines in the U.S. are suffering.
Several of them were forced into bankruptcy in recent weeks, citing high fuel costs as one reason for their financial woes.
"I think investors are just a little skittish and I think it's probably prudent on their part to scale it back," Erickson said.
The reduced amount, he said, may mean NewAir will start with fewer than three aircraft in the fall.
Erickson said NewAir has to start operations in the fall to cash in on the sunspot travellers. Plans are for the carrier to fly from underserved secondary markets to southern vacation destinations.
New Air is expected to go public in three to four years.
http://calsun.canoe.ca/Business/2008/04 ... 6-sun.html
Drinking outside the box.
Re: New Air
Yes, any news? I read some time ago in an online article that they were supposed to make an official announcement at the end of May, but no news as of yet. Have things been delayed more?
Re: New Air
i've heard nothing besides a couple of rumors. Wait and see I guess.
Drinking outside the box.
Re: New Air
With the price of gas and everything else associated with the airline biz I would imagine New Air is making more money NOT being in business then it would be if it WAS in business.
With the current layoffs at Air Canada and the state of the economy we are going to be seeing the same situation as we saw in the early 80's.
Fasten your seatbelts people as this ride is going to get really bumpy!
With the current layoffs at Air Canada and the state of the economy we are going to be seeing the same situation as we saw in the early 80's.
Fasten your seatbelts people as this ride is going to get really bumpy!
Re: New Air
I hear that NewAir is looking for people… their website now has a recruiting section (https://www.naatgroup.com/admin/jobProf ... rofile.php)… Also, heard something about 737’s anyone else have any updates?
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yyz monkey
- Rank 5
- Posts: 317
- Joined: Wed Nov 01, 2006 8:36 am
- Location: CNC3
Re: New Air
319s are also on the shortlist according to an article from the G&M.
Typing up the cover letter...
Typing up the cover letter...
The Theory of Flight - Because even after 100 years, we're still not sure it works!
Re: New Air
I'll be stunned if it isn't an NG fleet. Even Tim wouldn't be so old fashioned to go with his beloved -200's.
Drinking outside the box.
Re: New Air
I thought there red logo was a hammer and sickle for one second... 
That'll buff right out 
Re: New Air
yes thats exactly what Canada needs - more capacity. With near record oil prices, a wanning economy, I would think this is NOT the time to be opening a new low cost airline.
The feet you step on today might be attached to the ass you're kissing tomorrow.
Chase lifestyle not metal.
Chase lifestyle not metal.
Re: New Air
But they are......and a whole bunch of day oners at wj are going to go. Good on em I say.
Re: New Air
I'll guess we'll have to wait and see who's full of shit and who's serious. Personally, if they're that hot to go to Newair, they can have at'er. No skin off my butt. It's not like it's a financial risk for them...daveg wrote:But they are......and a whole bunch of day oners at wj are going to go. Good on em I say.
Drinking outside the box.
Re: New Air
a lot of the day 1ers are muti-millionaires... they're probably bored of WestJet and looking for some fun again in their golden years.
Re: New Air
After news of the B737NG being selected and a possible trade name for the company - all is quite again at NewAir? Anyone have any updates at all?
If they really do plan on starting this fall (which I've read many times), they have very seriously got to get things moving. Can they even get pilots trained in time if they really do plan on starting this fall, or by the end of the year at that? Perhaps they've got guys/gals that are already typed? I guess they're waiting for the AOC first?
At any rate, sounds like a very promising company/business plan. All the best!
If they really do plan on starting this fall (which I've read many times), they have very seriously got to get things moving. Can they even get pilots trained in time if they really do plan on starting this fall, or by the end of the year at that? Perhaps they've got guys/gals that are already typed? I guess they're waiting for the AOC first?
At any rate, sounds like a very promising company/business plan. All the best!
Re: New Air
Pilots are already trained and maintaining currency whilst under the employment of WS.
jjj
jjj
Re: New Air
There are at least 7 captains that are going over asap. Plan is to start with 3 NG's and go from there. Class for the FA's started today. The whole company will basically be ex WestJet folks, should be in the air by Late October. They certainly have a lot of sharp people over there running all aspects of things. Hope they do well.
Re: New Air
Lol, the F/A class did not start today. They just posted on Workopolis.... the few weeks away from class start.
Re: New Air
Sorry, you're wrong. Some of WS senior fa's don't need to go through the "application process", many are close friends with Tim and have worked together for years. They are only interviewing for new applicants.
Re: New Air
daveg - you didn't read my post. I did not say anything in regards to F/A's jumping ship. I commented on your statement that the F/A class "just started today". The trainer for that class hasn't quite their other job yet... I have no doubt that there will be lots of people that just walk on over from WJ to NA, but again training has not started yet.
Re: New Air
Hey just found this looks like they already got one of the planes in Canada
Mark: C-GOEJ
Common Name: Boeing Model Name: 737-7BD
Serial No: 33920
Basis for Eligibility for Registration: Type Certificate - CAR Standard 507.02 (1), 507.03 (3) - A16WE
Category: Aeroplane Max take-off weight: 60327.79 kgs
Engine: 2, Turbo Fan
24-bit address: 110000000110101000010010
Regional Office: Winnipeg Year Imported: 2008
Base of Operations: CANADA , Alberta, Calgary
Manufacturer Information
Manufacturer: BOEING
Country of manufacture: U.S.A. Year of Manufacture: 2005
Registration Information
Type of Registration: Commercial
Owner Registered Since: 2008-09-03
Latest Certificate of Registration Issued: 2008-09-03
Last Registered Owner Information
Name: 1263343 Alberta Inc.
Address: 770 McTavish RD. N.E.
City: Calgary Province/State: Alberta
Postal Code: T2E 7G6 Country: CANADA
Region: Prairie and Northern
Mail Recipient: Yes
searched it out on A.net and it is an ex AirTran plane reg N268AT
Mark: C-GOEJ
Common Name: Boeing Model Name: 737-7BD
Serial No: 33920
Basis for Eligibility for Registration: Type Certificate - CAR Standard 507.02 (1), 507.03 (3) - A16WE
Category: Aeroplane Max take-off weight: 60327.79 kgs
Engine: 2, Turbo Fan
24-bit address: 110000000110101000010010
Regional Office: Winnipeg Year Imported: 2008
Base of Operations: CANADA , Alberta, Calgary
Manufacturer Information
Manufacturer: BOEING
Country of manufacture: U.S.A. Year of Manufacture: 2005
Registration Information
Type of Registration: Commercial
Owner Registered Since: 2008-09-03
Latest Certificate of Registration Issued: 2008-09-03
Last Registered Owner Information
Name: 1263343 Alberta Inc.
Address: 770 McTavish RD. N.E.
City: Calgary Province/State: Alberta
Postal Code: T2E 7G6 Country: CANADA
Region: Prairie and Northern
Mail Recipient: Yes
searched it out on A.net and it is an ex AirTran plane reg N268AT
Re: New Air
Commuter;
Exactly, definitely not a -700 with that gear underneath.
carholme
Exactly, definitely not a -700 with that gear underneath.
carholme
