According to the National Post AC revised its fare structure and did away with Econo fares on Sunday:



Business flyers gain from new Air Canada fares
Levels playing field

Sandra E. Martin
Financial Post


Tuesday, October 19, 2004


Air Canada has overhauled its fare structure, cancelling econo-class and round-trip tickets for all flights within continental North America, and offering one-way flights exclusively.

Minimum stay and Saturday stay-over rules have been eliminated on these flights as well, the airline said.

Business travellers stand the most to gain from the changes, said Jill Kellow, director of national corporate consulting for BTI Canada, a private business travel management consulting firm.

In the past, round-trip travel that did not include a Saturday stay-over was subject to a significant premium, which effectively forced business travellers to subsidize the lower fares charged to leisure travellers whose trips straddled at least one weekend.

"For the longest time, the business traveller [has been saying], 'No, we don't want to pay tenfold for the same seat,' " Ms. Kellow said, adding Air Canada's new, all-one-way structure levels the playing field.

"Enforced Saturday stay-overs and return fares are the bane of air travellers and the last vestiges of old-style airline pricing," said Montie Brewer, Air Canada's executive vice-president of commercial operations, in a prepared statement. "We're delighted to get rid of them."

Analysts say some of these changes are in response to the success of discounters like West Jet and Jetsgo.

"If you look at low-cost, low-fare [airlines] across the planet -- everything is one-way," said Calgary-based consultant Rick Erickson of RP Erickson & Associates.

Ms. Kellow likes one-way fares because they allow travellers to customize their itineraries to a far greater degree.

For example, she said, you can book a departure flight you like on Air Canada, and pair it up with the best-priced, most convenient return fare on another carrier: "It creates more options for the traveller."

Air Canada has also streamlined its offerings by cutting out the econo-fare option. Travellers can now choose from the five remaining categories, with various pricing and service levels: Tango, Fun, Latitude, Freedom and Executive.

Tango is the cheapest, but also offers the least flexibility, and you have to pay an additional fee for advance seat selection. At the other end of the spectrum, Executive seats are the priciest, but also include advance seat selection, complete flexibility to change flights, food and drink in flight, as well as other perks.

Changes were effective as of Sunday, when Air Canada issued a press release so quietly that even Mr. Erickson, a long-time industry watcher, missed it.

However, Mr. Erickson praised the move as the next step in a full makeover for the carrier, which emerged from 18 months of bankruptcy protection two and a half weeks ago, on September 30.

"I'm bullish on Air Canada's business opportunities," he said. "They're trying to build this trust with their customer base -- and they do this by [displaying] their fares on their Web site and simplifying their fares."

© National Post 2004








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