AC's future
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Re: AC's future
Just to add to that Stick, we have all seen this company grow and shrink every time there is a significant change in world economics. There is nothing out of the ordinary happening these days, it's a fact of life, always has been. The new AC did well in the good times but the changes made were not good enough to withstand the present environment. The trick is for this company to find a way to adopt some of the ideas of the models that are out there. And not just the LCC model. Lowcosts are not the only ones riding the storm successfully. Some of the world's largest legacy airlines will do just fine throughout these tough times. One has to wonder why in times like these, companies like LH and BA will do fine and AC won't. There is work to be done but when the dust settles, and it will, things will be back to expansion mode, only to be followed by more bad times.
Re: AC's future
Westjet pretty much mirrors AC route structure in Canada and is getting more A/C over the next 5 years. Jazz is a different airline, which will serve the smaller centers that are considered a "essential service"
I think the ASM flown domestically will continue to shrink at AC , with A320 replaced by jungle jet,etc, while WJ is projected to expand and the expense of AC domestically , as AC reduces capacity to offset their money losing routes. They have no choice but to cut back on routes that are marginal due to high oil-and oil is going to $200 by 2010. This has a direct, immediate impact on airlines and they have to react immediately. These routes are profitable for WJ, due to their cost structure, and they will move in. This high oil price is simply accelerating the capture of canadian market share from AC, which is going to WJ. WJ has been forcast for some time now to be at 50% of canadian market share in the future. If they do have 50% (or more) of canadian market and jazz is considered a different airline, then why would they government care? Canadian citizens can still travel?
I think the ASM flown domestically will continue to shrink at AC , with A320 replaced by jungle jet,etc, while WJ is projected to expand and the expense of AC domestically , as AC reduces capacity to offset their money losing routes. They have no choice but to cut back on routes that are marginal due to high oil-and oil is going to $200 by 2010. This has a direct, immediate impact on airlines and they have to react immediately. These routes are profitable for WJ, due to their cost structure, and they will move in. This high oil price is simply accelerating the capture of canadian market share from AC, which is going to WJ. WJ has been forcast for some time now to be at 50% of canadian market share in the future. If they do have 50% (or more) of canadian market and jazz is considered a different airline, then why would they government care? Canadian citizens can still travel?
Re: AC's future
Some people have been starting to ring the alarm bell on BA recently
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Re: AC's future
Piggy.WJ has been forcast for some time now to be at 50% of canadian market share in the future. If they do have 50% (or more) of canadian market and jazz is considered a different airline, then why would they government care? Canadian citizens can still travel?
I don't think the government will care. As long as the travelling public is happy, Ottawa will let it be. All things considered as they are, this is WJ's big opportunity. But if the price of oil continues to climb (some experts predict $200/brl), well I don't know. The problem is also the model. Under the present hub and spoke AC/Jazz system, small canadian communities have easy access to all canadian, US destinations and the world. And those that have been dropped will be reintegrated when/if things get better. WJ's model is still point to point flying without an efficient connection system to the rest of canada and beyond on a large scale. Those are big shoes for WJ to fill. Southwest has done it, sort of. Although even they don't serve communities of less than 100,000 in population, I don't think. Not many anyway. That would have to be addressed if WJ aspires to be canada's leading domestic carrier and perhaps this is where the government might scratch their heads a bit. Maybe not so if Jazz continues to serve the smaller communities. There's so much talk of alliances, but so far nothing. Again, this would be the time to act.
Re: AC's future
"There is work to be done but when the dust settles, and it will, things will be back to expansion mode, only to be followed by more bad times.'
So... ahh... has the music stopped Tony? Please relocate your glasses.

So... ahh... has the music stopped Tony? Please relocate your glasses.

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Re: AC's future
Is that WJ's overall strategic plan?tonysoprano wrote: ..... if WJ aspires to be canada's leading domestic carrier and ......
Hhhmmm, is this thing on?
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Re: AC's future
...I don't know. Partly for sure. Just think what it would do for their ads. Canada'a leading domestic carrier!!Herc_Driver wrote:Is that WJ's overall strategic plan?tonysoprano wrote: ..... if WJ aspires to be canada's leading domestic carrier and ......
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Re: AC's future
Well............ I am heading to CYYC from CYHZ middle of September and it is $758.00 return(all tax, surcharges and the like) included. That is still a good price in my view even with the volatility of oil and the nervousness amongst you chattering class on the state of your various airlines, especially that my trip is in three months time.



Re: AC's future
The government will never allow that to happen and if by chance they did, it would be accompanied by the new WJ Act, which would drive up their operating costs. I don’t think WJ wants to go there..tonysoprano wrote:...I don't know. Partly for sure. Just think what it would do for their ads. Canada'a leading domestic carrier!!Herc_Driver wrote:Is that WJ's overall strategic plan?tonysoprano wrote: ..... if WJ aspires to be canada's leading domestic carrier and ......
Re: AC's future
Old fella wrote:Well............ I am heading to CYYC from CYHZ middle of September and it is $758.00 return(all tax, surcharges and the like) included. That is still a good price in my view even with the volatility of oil and the nervousness amongst you chattering class on the state of your various airlines, especially that my trip is in three months time.
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Hey that’s a good deal although I’m rather surprised at the industry that they are willing to second guess the fuel surcharge so far in advance. Maybe that’s why the industry is in so much trouble. It’s rather interesting that certain US interest groups are trying to reintroduce regulation again. We seem to be pouring the same old wine out of a new bottle or maybe that’s the other way round.
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Re: AC's future
I think if WJ wanted to become Canada's true domestic leader it would require service to smaller communities hence different equipment, hub and spoke and all the strings attached with that operation. Having 51% of the domestic market doesn't mean you are providing an essential service. The government has imposed certain rules on AC not only because of the numbers but also because of the overall, system-wide service. It's not just the maple leaf on the tail, it's the service. But I still maintain that WJ would be free of any government strings because there already is a carrier under government control. That would be us. Nothing special except for the fact that the government ultimately shares the responsability in the viability of the venture (ya right), like it or not. Although there hasn't been much intervention lately (other than a certain merger to save a few jobs) and that's the way they like it. The one thing Mulroney, Chretien, Martin and Harper have all enjoyed is control over AC. What a country!!!The government will never allow that to happen and if by chance they did, it would be accompanied by the new WJ Act, which would drive up their operating costs. I don’t think WJ wants to go there..
Re: AC's future
I don’t believe in a heart beat that the government would allow WJ to be free of any and all strings if they allowed WJ to become the dominate domestic carrier. It just wouldn’t happen, as that would be against their vision of Canada. As I said before Canadian aviation among other things is purely political. Stay within the vision political guidelines and the government is happy, stray and suffer the consequences.
I hope you don’t believe that WJ’s Clive was let off the hook because Milton is a nice guy. Hey that had government written all over it..If Milton had his way he would have gone for the jugular whatever..
Oh and what I find shameful is the governments’ clandestine poitical control but lack of financial accountability when their vision goes wrong.
I hope you don’t believe that WJ’s Clive was let off the hook because Milton is a nice guy. Hey that had government written all over it..If Milton had his way he would have gone for the jugular whatever..
Oh and what I find shameful is the governments’ clandestine poitical control but lack of financial accountability when their vision goes wrong.
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Re: AC's future
..well, they'll have to let go of us if they regulate them. Can't do us both in. Of course, this is all a pipe dream. Like I said, 51% doesn't give them the helm. We are different animals. When they can carry a pax from Timmins , Ont. to Paris, France, with automatic baggage transfer, same company, same class, same coupon, same booking reference, same reward points etc., then the government will take notice. They will also find it difficult to change the model which has worked till now. IOW, ain't gonna happen. Alliances might play a role, but Ottawa won't see that as a big deal. They will continue to control us as long as we egsist in the model we have now. Remember, LCC and Flag carrier aka apples and oranges. 

Don't be so sure of that. When the brink hits, if it ever does, they'll have to examine our place in the Canadian economy and to a lesser degree, 70 years plus of political, economic and social history of this country. Not to mention the 20 some thousand jobs in Canada and around the world. Yikes, almost makes me feel like a civil servant.Oh and what I find shameful is the governments’ clandestine poitical control but lack of financial accountability when their vision goes wrong.
Re: AC's future
The canadian government has very little control over how "dominant " Wj is in the domestic market. WJ, JAzz and AC are all 100% public traded companies. Yes , there is some regulation, essential service to some communities -the bulk of it done by jazz which is connected to AC only through a capacity purchase agreement, some language regulations, whatever.
The fact is that WJ mirrors AC on the domestic flying, not completely the same as jazz-but jazz is not AC is it..
The government knows it did not work before with can and AC in canada, they want market forces to regulate the market with supply/demand, let the best airline win--this is exactly what is happening.
the fact is that the governments policy of allowing airlines to compete is working. It is a competitive marketplace, which is for the airlines own good, because with operating costs the way the are these days, only the leanest , meanest airline is going to make it work.
Having said that, in some ways, WJ route structure is a little like canadians, minus some can regional routes and the intl routes.
So if WJ goes to 50%, or 60% of the canadian market, will the government will say, oh, wait a minute-you cant do that??? i think not.
i think going forward, jazz will shrink a little perhaps, AC will shrink a little domestically, and their intl flying will grow--unless there is a global recession in 2010, then it will shrink as well at that time.
WJ will continue their expansion with 45 more 737 until 2013, feeding off what AC cant afford to do, and generating new pax, as canadians travel more.
The fact is that WJ mirrors AC on the domestic flying, not completely the same as jazz-but jazz is not AC is it..
The government knows it did not work before with can and AC in canada, they want market forces to regulate the market with supply/demand, let the best airline win--this is exactly what is happening.
the fact is that the governments policy of allowing airlines to compete is working. It is a competitive marketplace, which is for the airlines own good, because with operating costs the way the are these days, only the leanest , meanest airline is going to make it work.
Having said that, in some ways, WJ route structure is a little like canadians, minus some can regional routes and the intl routes.
So if WJ goes to 50%, or 60% of the canadian market, will the government will say, oh, wait a minute-you cant do that??? i think not.
i think going forward, jazz will shrink a little perhaps, AC will shrink a little domestically, and their intl flying will grow--unless there is a global recession in 2010, then it will shrink as well at that time.
WJ will continue their expansion with 45 more 737 until 2013, feeding off what AC cant afford to do, and generating new pax, as canadians travel more.
Re: AC's future
Sorry piggy your vision is wishful thinking, you seem to forget you live in Canada..
Re: AC's future
Please elaborate, interested.Rebel wrote:Sorry piggy your vision is wishful thinking, you seem to forget you live in Canada..
Re: AC's future
Heck if there were a level playing field there would be a WJ Act to match the AC Act. What I find interesting is the denial of the AC Act on this forum. The majority said there was no such act until others published the link. It matters little what this forum or for that matter any other forum thinks. It’s what the government thinks and does that counts.
That's Canadian aviation reality...
That's Canadian aviation reality...
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Re: AC's future
Piggy:
Not entirely true. Correct me if I'm wrong but WJ does very little feeding from small communities (100,000 or less) to bigger ones and onwards to US and overseas destinations. I believe the original WJ model avoided this scenario and still does but maybe that will change if AC drastically shrienks??? Also, Jazz may not be AC but that doesn't matter. They feed AC. They are part of the model. So does Georgian. At this time, who feeds WJ?The fact is that WJ mirrors AC on the domestic flying, not completely the same as jazz-but jazz is not AC is it..
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Re: AC's future
Remember when WJ serviced Thompson and Sudbury in 2002 or so? It wasn't profitable, hence the pullout from those markets. It created little or no public reaction (outside of those areas) that I can recall. If AC attempted this, it would be front page national news and wouldn't be permitted because AC doesn't enjoy the same liberties as WJ...
I recall when AC (with a DC9 and then later a DH8) had to stop in YQI (Yarmouth NS) enroute to Boston only to drop off one or deux pax, a bag of mail, dump the shitter, and discard the half eaten muffins that passengers didn't have time to finish because the segment was too short. Finally, I think circa 1996-97, service to YQI stopped altogether and so did some of the bleeding. Local and provincial leaders in NS took it to the federal level to try to have the service re-instated because they knew that they may have success perhaps because of the ACPPA. They didn't succeed in their attempt, but MP's listened, and it made more than just the local news.
I recall when AC (with a DC9 and then later a DH8) had to stop in YQI (Yarmouth NS) enroute to Boston only to drop off one or deux pax, a bag of mail, dump the shitter, and discard the half eaten muffins that passengers didn't have time to finish because the segment was too short. Finally, I think circa 1996-97, service to YQI stopped altogether and so did some of the bleeding. Local and provincial leaders in NS took it to the federal level to try to have the service re-instated because they knew that they may have success perhaps because of the ACPPA. They didn't succeed in their attempt, but MP's listened, and it made more than just the local news.
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Re: AC's future
Old fella wrote:Well............ I am heading to CYYC from CYHZ middle of September and it is $758.00 return(all tax, surcharges and the like) included. That is still a good price in my view even with the volatility of oil and the nervousness amongst you chattering class on the state of your various airlines, especially that my trip is in three months time.
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Old Fella
I am happy that you got a good deal on the above ticket but if I may, I would like to use this example in my argument that airlines will never make money until the traveling public realizes that there needs to be a drastic increase in fare structures. I know for a fact that I cannot ride my motorcycle from YHZ to YYC and back again for $758. That is just my cost in fuel for the motorcycle, not wear and tear or depreciation. Not to mention it would take me several weeks. Along with that, your total price includes all the parasitic fees that now plague the industry, so the airline is seeing quite a bit less than the $758 it is collecting.
Personally, I think the "model" of paying bus fare for airfare is the most ridiculous thing I have ever heard and since its' inception, it has done nothing but deteriorate the professional pilot profession.
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