Originally Posted by
CloudsBelow
Another pull down from a foreign carrier serving Canada.
US (AA) have cut YOWCLT. There goes another 18,000 seats. FFS
I don't want to give AC more credit than they deserve but Ottawa/Gatineau > South Florida is a (relatively) huge market. CLT feeds Southeast USA. AC extends YOWFLL year-round, goes double-daily on some days .... And now we get the cancellation of YOWCLT. Hard to argue US/AA's decision to cut was not heavily impacted by AC.
In the last 18 months, AA (and US) have pulled over 60,000 annual seats out of Ottawa market. This "undersupplied" talk needs to go away
The US carriers are at a disadvantage to AC now - while both have to buy fuel in US dollars, AC gets revenue from US Pax in USD that covers a substantial portion of that. Unfortunately US carriers get Canadian revenues in CAD.
So when it comes to employees AC can augment its fuel bill with USD and pay its crews and staff in CAD. The US airlines can pay for nothing in CAD. Air Canada's relative cost of labour (biggest airline expense) is dropping, while it may not have the same fuel gains as the US carriers it has the effect of a broad across the board cost cut at AC.
And if you don't think this is a factor take a look at when the US carriers really started flying to all of the cities in Canada (like YQR and YXE) - it was when the Canadian dollar was much closer to par in a better economy. If you look across the board the US carriers are on retreat. YHZ->ORD is done for example... I never flew on it when it wasn't full... Me thinks this is just the beginning.
Also please spare us the AC is cutting capacity in Edmonton crap - Its cutting LHR on the whole it will deploy something like 15% (the stat was posted somewhere from the horses mouth in a press release/news piece) more seats to the airport this year. Thats not a cut.
Personally I think once there are 787-8s to spare Edmonton will get LHR back for the summer. The higher density configuration will give them back a cost advantage of KLM -AirFrance, HD has allowed them to be more aggressive with KLM-AF in the east.