Found this interesting news article on the internet today



Integra Air files complaint over Air Canada pricing

By DAVE MABELL

Lethbridge Herald

Southern Alberta's hometown airline has filed an official complaint, charging Air Canada's price-cutting is aimed at driving competition out of the market.

Calgary-based Regional 1 gave up its Lethbridge flights earlier this year, citing unfair Air Canada pricing, and now Integra Air has filed a formal complaint with the Competition Bureau of Canada.

Integra Air president Brent Gateman said Thursday he's told the federal bureau Air Canada is using "uneconomical pricing to force the smaller airline out of the marketplace."

At its Internet-posted price of $108 (plus taxes and fees) for a one-way trip, he said, Air Canada appears determined to drive Integra out of scheduled service as it did Regional 1.

"After Regional 1 disappeared, we waited to see if they'd adjust their fares," Gateman said. "They haven't."

He said fares from Lethbridge to Vancouver -- a route where Integra competes directly -- are substantially lower than for similar-length Air Canada service from Lethbridge to Saskatoon or Regina, where there's no comparable competition.

"We have trouble understanding . . . how Air Canada can properly cover their costs with this pricing structure," he said.

"Currently, at the Air Canada pricing level, we would not be able to cover our costs," Gateman said.

Integra flies similar aircraft but Gateman maintains Integra service is superior because it's non-stop (no changing planes in Calgary) and because it offers complimentary meals and beverages as well as free parking at the Lethbridge airport. Same-plane service continues to Victoria, he adds, and there's also weekend service to Abbotsford.

One-way flights are priced at $199, a price Gateman said allows Integra to break even at a 60 per cent payload -- the industry average.

"We will never be able to viably offer the low fare prices such as a large airline in a larger market like Calgary," he said.

If southern Alberta travellers want to keep competitive air service, Gateman said they should weigh the benefits of continued direct flights to key markets including Edmonton and Vancouver, against the national company's "seat sale" prices on strategically selected routes.

"We are hopeful the Competition Bureau will recognize this as predatory pricing and make some changes to Air Canada's pricing in hopes that the community of Lethbridge and southern Alberta will continue to benefit from the current options," he said.

In Ottawa, bureau spokesman Tim Weil confirmed receipt of the formal complaint but was unable to say how long the investigation process could take.

"We will review it carefully and see if it raises any issues under the Competition Act," he said.

In a previous Competition Bureau case, Calgary-based WestJet won a similar judgment against Air Canada.

In Vancouver, Air Canada regional spokesman Angela Mah said Thursday her company has not yet received word of Integra's action.

"We will respond directly to the bureau in due course when the complaint is received," she said.