Fraser Institute takes on Canada's Aviation Policy
Jul 4, 2012, 3:04 pm
#1
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Join Date: Aug 2010
Posts: 3,130
Fraser Institute takes on Canada's Aviation Policy
http://www.calgaryherald.com/news/Mi...783/story.html
Nothing surprising in there, to be honest. Looks like cabotage is being put forward by more and more economists. Doubt it will happen, what with Ottawa's myopic bureaucrats.
Ah well, worth a read nonetheless (delete if repost).
Nothing surprising in there, to be honest. Looks like cabotage is being put forward by more and more economists. Doubt it will happen, what with Ottawa's myopic bureaucrats.
Ah well, worth a read nonetheless (delete if repost).
Jul 4, 2012, 3:23 pm
#2
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Join Date: Aug 2010
Posts: 3,130
Been away for a couple of weeks, but it looks like the economists are all going after Transport Canada's ineptness. First Fraser (no surprise there), now Rotmans (some surprise there).
http://www.thestar.com/opinion/edito...-back-to-earth
Interesting points here:
- Canadian price premium is often between 50 and 100 per cent
- Domestic air travel in Canada, measured by passenger miles flown per-capita, is only about 40 per cent of the corresponding U.S. level.
This is especially surprising given that Canadian cities are generally further apart than are U.S. cities; if anything, we should be flying more than Americans, for whom driving is often a feasible alternative.
- Suggest that Canadians are flying less both for business as well as pleasure.
- (On the Senate's call for lower taxes and fees in Canada's aviation industry): Economic theory has convincingly shown that firms with a lot of pricing power do not respond much to lower costs by reducing final prices. The real driver of such price reductions is competition, and this is something that we have very little of. @:-)
Hmmm. Wonder what's caused the sudden interest. Maybe they tried booking tickets recently ?
http://www.thestar.com/opinion/edito...-back-to-earth
Interesting points here:
- Canadian price premium is often between 50 and 100 per cent
- Domestic air travel in Canada, measured by passenger miles flown per-capita, is only about 40 per cent of the corresponding U.S. level.
This is especially surprising given that Canadian cities are generally further apart than are U.S. cities; if anything, we should be flying more than Americans, for whom driving is often a feasible alternative.
- Suggest that Canadians are flying less both for business as well as pleasure.
- (On the Senate's call for lower taxes and fees in Canada's aviation industry): Economic theory has convincingly shown that firms with a lot of pricing power do not respond much to lower costs by reducing final prices. The real driver of such price reductions is competition, and this is something that we have very little of. @:-)
Hmmm. Wonder what's caused the sudden interest. Maybe they tried booking tickets recently ?
Jul 4, 2012, 7:01 pm
#3
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Feb 17, 2013, 12:04 pm
#4
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The Harper Govt's taxation policy is killing business.
http://www.atlanticbusinessmagazine....up-in-the-air/
"According to the World Economic Forum’s 2008 Travel and Tourism Competitiveness Report, Canada ranked 114 out of 130 nations surveyed for overall “price competitiveness” and 122nd for “ticket taxes and airport charges”, even while it scored first for “air transport infrastructure”. The same survey last year showed improvement in the overall standings (105 in price and first, again, for infrastructure), but the country dropped to 125th place in the metric of taxes and charges. “Canada is losing 5 million Canadian passengers to the U.S. annually,” she says. “And that equates to $1.3 billion in lost Canadian GDP and $200 million in lost tax revenue.”
Indeed, according to the World Economic Forum’s 2008 Travel and Tourism Competitiveness Report, Canada ranked 114 out of 130 nations surveyed for overall “price competitiveness” and 122nd for “ticket taxes and airport charges”, even while it scored first for “air transport infrastructure”. The same survey last year showed improvement in the overall standings (105 in price and first, again, for infrastructure), but the country dropped to 125th place in the metric of taxes and charges.
As a result, Macleans Magazine reported last year, “Over the years, a host of foreign airlines, from Hong Kong’s Cathay Pacific and Israel’s El Al to Virgin America and Frontier Airlines, have either shelved expansion plans or stopped f lying to Canada altogether . . . airfares . . . are, on average, up to $120 more expensive than in the United States, according to some estimates.”
http://www.atlanticbusinessmagazine....up-in-the-air/
"According to the World Economic Forum’s 2008 Travel and Tourism Competitiveness Report, Canada ranked 114 out of 130 nations surveyed for overall “price competitiveness” and 122nd for “ticket taxes and airport charges”, even while it scored first for “air transport infrastructure”. The same survey last year showed improvement in the overall standings (105 in price and first, again, for infrastructure), but the country dropped to 125th place in the metric of taxes and charges. “Canada is losing 5 million Canadian passengers to the U.S. annually,” she says. “And that equates to $1.3 billion in lost Canadian GDP and $200 million in lost tax revenue.”
Indeed, according to the World Economic Forum’s 2008 Travel and Tourism Competitiveness Report, Canada ranked 114 out of 130 nations surveyed for overall “price competitiveness” and 122nd for “ticket taxes and airport charges”, even while it scored first for “air transport infrastructure”. The same survey last year showed improvement in the overall standings (105 in price and first, again, for infrastructure), but the country dropped to 125th place in the metric of taxes and charges.
As a result, Macleans Magazine reported last year, “Over the years, a host of foreign airlines, from Hong Kong’s Cathay Pacific and Israel’s El Al to Virgin America and Frontier Airlines, have either shelved expansion plans or stopped f lying to Canada altogether . . . airfares . . . are, on average, up to $120 more expensive than in the United States, according to some estimates.”
Feb 18, 2013, 1:42 pm
#6
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Domestic air travel in Canada, measured by passenger miles flown per-capita, is only about 40 per cent of the corresponding U.S. level.
This is especially surprising given that Canadian cities are generally further apart than are U.S. cities; if anything, we should be flying more than Americans, for whom driving is often a feasible alternative.
This is especially surprising given that Canadian cities are generally further apart than are U.S. cities; if anything, we should be flying more than Americans, for whom driving is often a feasible alternative.
1) It's a self-fulfilling prophesy. Flights are expensive, so Canadians fly less.
2) Flyers on vacation tend to leave Canada rather than fly domestically. If my retired parents can fly from Vancouver to London for $300 less than it costs to fly from Vancouver to Charlottetown, guess where they're going to go?
3) Canadians are less nomadic than Americans. While Americans know people scattered all over the place and fly to visit them, Canadians' friends and family tend to be in their own cities.
4) Canadian business travellers fly North/South much more than east/west