Remember that Aeroplan is now a separate subsidiary of AC, likely to be spun off. It was mandated to make money for the carrier and become a major profit centre. After moving in this direction last year, I expounded how an internal booking methodology had to be established to charge AC for the services provided by Aeroplan. These changes reflect a cost-recovery accounting method on many levels.

First, the services previously borne by AC for booking and issuing Aeroplan tickets must now be borne by the user, us. AC lost a billion dollars last year, and has likely absorbed 10% or more of its res time and energies on Aeroplan bookings, etc. The only way to recapture that cost is to collect it from the users. Obviously, Aeroplan itself will not absorb any of that cost, other than setting up the initial reservation and issuing the original ticket.

Second, Aeroplan has upped the cost of buying miles for everyone. AC, faced with the decision of keeping accumulations stable or reducing them to offset the 35% increase, opted to drop them in the context which made the most sense: low-yield domestic tickets. Granted, the lack of serious competition made this more realistic on domestic travel, but with Q, L and N fares at the level they were, in the face of increased operating costs, it was either add another couple of dollars for the Aeroplan miles, or reduce them to keep control on costs. Remember, AC is paying Aeroplan for each mile it gives us. This payment comes from a piece of the ticket price. As a trade-off, AC has increased the miles earned on more costlier discount tickets. As for COS bonus on upgrades, well, these too cost money and AC feels it is spending enough giving us the additional services of J.

Like it or not, when a company is hemoraging cash, it has to make serious adjustments. Yes, they may be alienating a certain percentage of its customer base, but the overwhelming majority of corporate accounts will hardly notice these changes. Smaller, owner-operated companies, individuals like ourselves will certainly be aware of them, but the major corporations manage their travel in a very different way.

Yeah, sure I am being an appologist for AC. But I am also willing to face up to reality, guys. People are losing their jobs because the airline(s) cannot bring the books into any semblance of balance. Yes, full fares are rediculously high and the industry needs to seriously rethink its fare structure. But it is also a fact that if more people are paying less money, without even further cutting back of capacity, those remaining last minute seats have to pick up the balance of the costs. A report this past weekend noted that the major US carriers now require load factors in the high 80% level -- 86%, 87% -- to break even! This is an unachievable level. AC likely is in a similar situation.

Yes, it is nickel and dime time. I understand some of you are rightly pissed off at having to pay full Y fares, which strike you are outrageous given what advance booking fares are running. My small business cannot afford them, so I make judicious use of Aeroplan awards in such last-minute travel situations, or earlier this year took advantage of the MHD anomoly. I may even consider an H-class HKG ticket next time I have to head off to YVR with less than 7-days notice, assuming I can spend a couple of days sight seeing in the old colony.

Yet when I can buy a $650 return ticket to YEG every month, and know I will be sitting in the front cabin, I really cannot complain about being gouged by AC. I could save $200 and fly Q or L, but the extra cost for V-class is within line of those US carriers that still permit upgrading from any fare. Afterall, those 500-mile upgrades go quickly on transcons, and thus will require the purchase of upgrades at somewhat more than the AC class difference. So in the end, AC actually is providing me with, in effect, an any class upgrade at a cost that is less than AA or UA. And perhaps at this fare level, it is breaking even on my seat in Hospitality, but certainly not so in Business [even with downgraded service of late].

I do agree AC could have made these changes in a more enlightened fashion. Its PR and street smarts remain at an inexcuseable low. What are they paying Donolo for? When will the boys in the Dorval bunker start seeing the world outside?