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Old Aug 30, 2016, 1:10 pm
  #9945  
jlemon
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Join Date: Apr 2010
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Originally Posted by WHBM
I believe this was part of a commercial deal between Nordair and Stelco, the mainstream Canadian steel producer of the 1970s, to operate direct flights between Hamilton, site of the major Stelco facility, and Pittsburgh, as they had considerable commercial contacts with US Steel and others there.

Until this was agreed, Air Canada out of Toronto were apparently not interested, and many staff actually drove over the border to Buffalo NY and went from there, took a Stelco corporate flight, or even drove all the way. Air Canada probably never imagined anyone would ask for the route, then never imagined that Transport Canada would allow it, then thought it would be on a DC3 or something. But a 737 ? Bigger than AC's DC-9-30s ?

We are sustained here at London City by a similar commercial deal 40 years on, where the BA A318 flight to New York was underpinned by Barclays Bank buying 25% of the capacity for years ahead, which gave BA the commercial certainty to buy the A318s and get the service up and running. it's not 25% of every flight, but averaged over time. The American service from London Heathrow to off-hub Raleigh/Durham is similarly sustained by a long-term agreement with the SmithKline pharmaceuticals company.
And I am reminded of a good friend who is an aviation manager with a certain super-major oil and gas company that has a global presence. He was involved in negotiating a commercial deal for employee travel between Houston (IAH) and Amsterdam (AMS). There are only two air carriers operating nonstop service on the route, being KLM and United, of course. Negotiations were conducted with both airlines and it appeared UA had the upper hand with regard to pricing. Then my friend said, "But, United, you are operating a 767 on the route while KLM is operating a 747. It sure would be nice to have a larger aircraft on the service, especially as many of our employees are permitted to fly business class internationally." No problem, said UA, and then offered to operate a B777-200ER with a BusinessFirst cabin on the route. And so the deal was done.
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