Air Canada Weighs Pulling Out of Toronto Island Airport Amid Push to Cut Overall Costs

Declining revenues, limited access to facilities and constraints on growth may see Air Canada exit the Toronto Island airport.

Air Canada is reviewing the viability of its operations at Billy Bishop Toronto City Airport (YTZ) according to a report from The Globe and Mail. Citing continuing efforts to control costs and limited access to the facility, the airline is reportedly considering terminating service out of YTZ.

The island airport, located along Toronto’s waterfront, began commercial services in 1939 when Tommy Dorsey and his band arrived. It currently serves two million passengers per year and is popular with business travelers. The airfield is owned and operated by the Toronto Port Authority (TPA), and the dominant carrier is Porter Airlines, which has made YTZ its home base and corporate headquarters. Porter also owns the airport’s terminal building.

Porter has used its status at YTZ to secure most of the takeoff and landing slots, limiting any expansion of service by Air Canada. In 2006, Air Canada was evicted from terminal building and had to suspend its operations. After several years of court battles, the Canadian flag carrier returned in 2011.

YTZ is currently served only by turboprop aircraft, but Porter wants to extend the runway to accommodate jet aircraft. The proposal has created a heated debate in civic circles.

The TPA does not plan on increasing the number of takeoff and landing slots at YTZ. Presently, Porter controls 172 slots and operates to 21 cities in eastern North America. Air Canada controls 30 slots, which its uses to offer 15 round-trip flights to Montreal-Pierre Elliott Trudeau International Airport (YUL).

Air Canada’s load factor at YTZ grew during 2014, but according to analysts, the airline saw a 15 percent decline in revenues from its operations at YTZ.

[Photo: Toronto Port Authority]