Transportation Information Update* Editor: Joseph Monteiro** February 2009, No. 54 Associate Editor: Gerald Robertson** Current Developments in Brief AIR TRANSPORTATION 1. Airport activity [2007 Preliminary] In 2007, air passenger traffic at Canadian airports increased 4.4% compared to 2006, Air Transportation continuing its upward trend since 2003. All sectors witnessed the increase with the CANADA international sector posting the largest increase (6.0%). Cargo tonnages loaded and 1. Airport activity, February 3, 2009, unloaded at Canadian airports increased by 12.9% in 2007 compared to the previous www.statcan.ca year. 2. WestJet announces record January load 2. WestJet announces record January load factor of 76.8 per cent factor of 76.8 per cent, February 4, 2009, On February 4, 2009, Westjet announced a load factor of 76.8 for January 2009, 0.6 www.westjet.ca points higher than January 2008. Available seat miles and revenue passenger miles 3. WestJet, Air France and KLM Announce were 9.4% and 10.3% higher respectively than the January 2008 statistics. Sean Durfy Signing of M emorandum of Understanding, stated that "We are pleased with our increased load factor for the month of February 4, 2009, www.westjet.ca January,...Our traffic results demonstrate the success of our efforts to continue to 4. Air Canada expands Calgary service with profitably grow...." new daily flights to San Diego, CA; London, ON; Whitehorse, YK; and Portland, OR, 3. WestJet, Air France and KLM Announce Signing of Memorandum of February 4, 2009, www.aircanada.ca Understanding 5. Air Canada to launch new non-stop On February 4, 2009, WestJet, Air France and KLM announced that they have signed seasonal service between Sydney, NS and Toronto, February 4, 2009, www.aircanada.ca a memorandum of understanding to build a new commercial relationship between the three airlines. The understanding includes a code-sharing agreement, a interline 6. Air Canada reports record January traffic, agreement (which includes e-tickets, baggage and passengers) and a frequent flyer February 4, 2009, www.aircanada.ca program. It builds on Westjet strategy to increase connectivity. 7. Canadian airlines encounter turbulence in buyer’s market, February 5, 2009, 4. Air Canada expands Calgary service with new daily flights to San Diego, CA; www.nationalpost.ca London, ON; Whitehorse, YK; and Portland, OR 8. Cargo Plummets 22.6% in December, Air Canada on February 3, 2009 announced the introduction of four new non-stop January 29, 2009, ww w.iata.org routes from Calgary to : San Diego, California; London, Ontario; Whitehorse, Yukon; 9. Delta Hotels Partners with Air Canada to and Portland, Oregon . The flights begin in May and June 2009. Provide Big Savings for Business Travelers, February 5, 2009, www.aircanada.com 5. Air Canada to launch new non-stop seasonal service between Sydney, NS 10. Government of Canada invests in airport and Toronto safety across the country, February 6, 2009, Air Canada announced on February 4, 2009 that starting May 1, 2009, it will launch www.tc.gc.ca daily seasonal non-stop service between Sydney, NS and Toronto. 11. Air Canada unions demand pension funding, February 9, 2009, 6. Air Canada reports record January traffic www.globeandmail.ca On February 4, 2009, Air Canada reported its traffic for January 2009: a load factor 12. Airlines sound alarm over passenger of 79.4% (compared to 78.7% for January 2008, a 0.7 points increase); revenue rights bill, February 10, 2009, passenger miles 3,438 million (7.7% lower); and available seat miles or capacity 4, www.globeandmail.ca 330 million (8.5 % lower). For the combined carriers (Air Canada and Jazz), 13. 'All-in' airfare advertising rules stall statistics for January 2009 were: a load factor of 78.1% (compared to 77.9% for before takeoff, February 10, 2009, January 2008); revenue passenger miles 3,713 million (8.5% lower); and available www.nationalpost.ca seat miles or capacity 4, 754 million (8.8% lower). 14. WestJet announces fourth quarter and 7. Canadian airlines encounter turbulence in buyer’s market year-end results, February 11, 2009, While air travellers benefit from the decline in airfares, this decline raises concerns www.westjet.com for Canadian carriers as they find it difficult to further stimulate demand. The weak 15. WestJet profit slides 45.9%, February 11, pricing environment is expected to have a detrimental effect on Canada’s two major 2009, www.nationalpost.ca airlines. The National Post indicates that the average domestic leisure traveller spent 16. WestJet profit falls as revenue rises, 20% less on air fare in January 2009 compared to same period in 2008, while February 11, 2009, www.globeandmail.ca * The CTRF is not responsible for the information provided in this Update. ** The information provided is from the Authors and neither the Competition Bureau or Industry Canada is responsible for it. 1 corporate travellers spent 25% less. Declines in U.S. cross-border fares were even more pronounced by as much as 33% on average year over year, with international fares falling by up to 22%. 8. Cargo Plummets 22.6% in December 17. Aircraft movement statistics: Small airports [October 2008], February 12, 2009, IATA reports that for the December 2008, global international cargo traffic plummeted www.statcan.gc.ca 18. Air Canada reports 2008 fourth quarter 22.6% compared to December 2007. The same comparison for international passenger and full year results, February 13, 2009, traffic showed a 4.6% drop. The international load factor stood at 73.8%. For the www.aircanada.com/en/about/media/facts/in dex.html calendar year 2008, international cargo traffic was down 4.0%, passenger traffic 19. Air Canada swings to loss, February 13, showed a modest increase of 1.6%, and the international load factor stood at 75.9% 2009, www.globeandmail.ca down from 77.3% in 2007. 20. Air Canada to shrink after $1-billion loss, February13, 2009, www.globeandmail.ca 9. Delta Hotels Partners with Air Canada to Provide Big Savings for Business 21. Transat and WestJet agree amiably to terminate air transportation agreement, Travelers February 13, 2009, www.westjet.ca 22. Air Fare [2006], February 13, 2009, Delta Hotels announced an exclusive partnership with Air Canada on February 5, www.statcan.gc.ca 2009, providing guests who book and stay at any Delta hotel or resort with 15% off 23. Singapore to stop direct Canada service, February 16, 2009, www.americanshipper.com their airfare with Air Canada to any destination where a Delta hotel is located. This 24. Air Canada pins success on service, 15% discount offer is available on Air Canada's Tango Plus, Latitude and Executive February 17, 2009, www.globeanmail.ca Class fares from February 4, 2009 until June 30, 2009. 25. Air Canada may be forced into bankruptcy: Analyst, February 17, 2009, www.nationalpost.ca 10. Government of Canada invests in airport safety across the country 26. Air Canada revives "The Grand Tour" with new Europe Pass, February 18, 2009, The Honourable Tony Clement, Minister of Industry, announced on February 6, 2009 www.aircanada.com funding under Round Two of the 2009-2010 Airports Capital Assistance program. 27. Canada and Co sta Rica successfully Canadians will benefit from enhanced airport safety of the federal government’s conclude air transport agreement, February 16, 2009, www.tc.gc.ca funding program. 28. More Accidents But Fewer Fatalities in 2008, February 19, 2009, ww w.iata.org 11. Air Canada unions demand pension funding 29. Aviation’s Role in Economic Recovery, Febraury 19, 2009, ww w.iata.org Air Canada's unions have asked Ottawa to demand that the airline's parent, ACE 30. Japanese air forwarders face fines, Aviation Holdings Inc., fund the employees' pension plan before the holding company February 23, 2009, www.joc.com 31. Aircraft movement statistics: Major winds up operations. Unionized workers claim that they made big concessions when airports [January 2009], February 24, 2009, Air Canada was being restructured and that these concessions would not have been www.statcan.gc.ca made if the pension plan was not to be repaid. 32. Canadian airline profits to drop more than 80% in 2009: Report, February 25, 2009, 12. Airlines sound alarm over passenger rights bill www.nationalpost.ca MP Jim Maloway introduced his private member's bill on air passengers rights in 33. Conference Board predicts worst year for airlines since SARS, February 25, 2009, Ottawa on February 10, 2009. The major provisions of this bill are: compensation to www.nationalpost.ca passengers embarked on the plane after the doors close for delays of more than an 34. Economic Gloom Continues in January Traffic, February 26, 2009, ww w.itat.org hour; fines for carriers that fail to make announcement of delays within ten minutes of 35. WestJet flies south for the summer, employees learning of such information; compensation for travellers who are bumped February 26, 2009, www.westjet.com off; and fines every time carriers advertise base air fares instead of the full amount to 36. Aircraft movement statistics: Small airports [November 2008], February 26, 2009, include taxes and surcharges. Canada's airline industry warned that the proposed www.statcan.gc.ca passenger bill of rights threatens to send airfares soaring and throw flights into chaos. 13. 'All-in' airfare advertising rules stall before takeoff US 1. BA cargo revenue up. February 6, 2009, In June 2007, Parliament passed legislation calling for "all-in" advertising for the www.joc.com airline business in Canada. However, consultations were first to be held by Transport Canada before this provision went into effect. No formal consultations have taken 2. British Airways books £127-million loss, February 9, 2009, www.globeandmail.ca place.