FlyerTalk Forums - View Single Post - Transport Minister Lapierre to move fast to allow U.S. airlines to fly within Canada
Old Feb 10, 05, 2:45 am
  #25  
notam2
 
Join Date: Aug 2004
Location: YHM
Programs: AC, US
Posts: 224
If Canada and the USA would grant eachother reciprocal cabotage rights, AC would have a major competitive advantage against the American legacy carriers. Let's take a look at the breakdown:

#1) The Canadian domestic market is saturated with respect to airlines. Competition is fierce, and I don't think any American legacy carrier would even want to try and compete on ANY Canadian route. They'd lose their shirt, and they've got their own problems to worry about.

#2) American legacy carriers fly very few point-to-point routes. For instance, how many big-6 carriers fly DTW-LAX non-stop? Only 1 - NW. The rest connect traffic through their hubs. Given this fact, I highly doubt any big-6 US carrier would fly YYZ-YVR non-stop. They'd rather connect traffic through their hubs.

#3) No American legacy carrier will setup a hub in Canada unless they've lost their mind. AC might benefit from setting up a hub (or mini-hub) in the USA.

#4) After the new terminal is built at YYZ, USA-USA connections might not require passing through Canada Customs. Any Canadian flying YYZ-ORD-YVR (or similar) would have to pass through US and Canadian customs. Point for AC.

#5) Say DL decided to fly SLC-YYZ-YUL. Everybody would have to deplane at YYZ and clear customs. Now say that AC decided to fly YYZ-DTW-SLC. Nobody would have to clear customs in DTW (although the bags would need to clear security). AC wins again.

The big question in my mind is whether is whether American legacy carriers could fly YYZ - LON non-stop or AC could fly LAX-NRT non-stop. This wouldn't be covered by cabotage rights, and I'm doubtful the Canadian gov't would want this, but even if they did allow this, I think the American carrier would need consent from the "other" country too (England in my example). As long as AC is Canada's sole international carrier, they're guaranteed a life.

-notam
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