Originally Posted by
Bytepusher
The high rents at YYZ translate into high landing fees charged to airlines. So in this case where AC is essentially price matching a competitive operator at an alternate airport they are absorbing the higher landing fees and either making that up with higher fares somewhere else or taking it out of profits.
Well ... the additional factor is that the two airlines are most likely flying completely different metal and potentially rather different load factors. So that may potentially justify very different fare structures, even without bringing profit margins into play.