New Airline to launch Transcon routes out of YHM by end of Summer, how will AC react?
Jun 12, 2015, 11:13 am
#91
Join Date: Dec 2008
Posts: 797
Those tariffs help for pay for my cheap Quebec education 
It is hard to make ULCC work here, but someone out there has to be able to figure it out. This is different from the food tariff and quota system. HST/security/ fuel will be the same no matter who operates in the country, it's changing the business model to make it profitable.
- 24 hour airport at YHM may be able to help, I said before expect weird flight times, this will help increase utilization of the planes. Flying longer, more revenue they will collect. I assume they will get a sweetheart deal at Hamilton and Winnipeg for landing and gate fees, plus charge for everything. Water 2 bucks, print ticket 20 bucks, bag too big and found out at gate 100 bucks, need to call? Call the Winnipeg local number, no need to splurge on a 1800#, Plus sell you tourists tickets while on board, while taking a cut.
It is possible to make it work, is it likely sadly I don't think so but as a guy with family all over this country - I'd want it to work.
It is hard to make ULCC work here, but someone out there has to be able to figure it out. This is different from the food tariff and quota system. HST/security/ fuel will be the same no matter who operates in the country, it's changing the business model to make it profitable.
- 24 hour airport at YHM may be able to help, I said before expect weird flight times, this will help increase utilization of the planes. Flying longer, more revenue they will collect. I assume they will get a sweetheart deal at Hamilton and Winnipeg for landing and gate fees, plus charge for everything. Water 2 bucks, print ticket 20 bucks, bag too big and found out at gate 100 bucks, need to call? Call the Winnipeg local number, no need to splurge on a 1800#, Plus sell you tourists tickets while on board, while taking a cut.
It is possible to make it work, is it likely sadly I don't think so but as a guy with family all over this country - I'd want it to work.
Poof, there goes that cost supposed advantage....
Rouge is luxurious compared ryanair.
I really want it to work as well but it won't. Ryanair and easyjet fly out of cheap cheap facilities and they were able to have enough say to ensure the facilities are spartan/cheap. $28 AIF is not cheap. Heck I imagine those ULCCs built their own facilities (also notice how in the USA, airlines often pay for their own terminals and upgrades?) And the airports charge extremely high rent + facility costs. And there's probably other hidden crap that we wouldn't think about like corporate+plane insurance costing 5x what it would in the US or something because of some Ontario "consumer protection" law or something. And considering the flashy new airport at YWG, I'd imagine a "sweetheart" deal would cost triple what a spartan airport at the US border would charge. Airports in Canada are amazing rackets, seriously if you want to get rich just get in on one of those "non profits". You should see all the waste that goes on at YYC.
It's not corporate greed, it's government greed. And government is greedy because its citizens want a government that large. And Canadians have the big government that they deserve, whether they consciously want it or not. Just go on the cbc news website, story after story of people wanting more government. So in effect, do Canadians really deserve a ULCC? Do Canadians really deserve affordable cheese and milk? No, they want taxation, they want protection, but they want to b--- and moan when that comes at a price.
And imagine how a whiney Canadian populace would take a Spirit like model....I mean paying more for a carry on? AC doesn't charge for carry ons! The government must do something!
The most rational thing to do if trying to save $$$ at the ed of the day is drive to Buffalo or Bellingham. The regulatory environment is favorable for consumers. Plus the cheese at trader joe's is cheap.
I really want it to work as well but it won't. Ryanair and easyjet fly out of cheap cheap facilities and they were able to have enough say to ensure the facilities are spartan/cheap. $28 AIF is not cheap. Heck I imagine those ULCCs built their own facilities (also notice how in the USA, airlines often pay for their own terminals and upgrades?) And the airports charge extremely high rent + facility costs. And there's probably other hidden crap that we wouldn't think about like corporate+plane insurance costing 5x what it would in the US or something because of some Ontario "consumer protection" law or something. And considering the flashy new airport at YWG, I'd imagine a "sweetheart" deal would cost triple what a spartan airport at the US border would charge. Airports in Canada are amazing rackets, seriously if you want to get rich just get in on one of those "non profits". You should see all the waste that goes on at YYC.
It's not corporate greed, it's government greed. And government is greedy because its citizens want a government that large. And Canadians have the big government that they deserve, whether they consciously want it or not. Just go on the cbc news website, story after story of people wanting more government. So in effect, do Canadians really deserve a ULCC? Do Canadians really deserve affordable cheese and milk? No, they want taxation, they want protection, but they want to b--- and moan when that comes at a price.
And imagine how a whiney Canadian populace would take a Spirit like model....I mean paying more for a carry on? AC doesn't charge for carry ons! The government must do something!
The most rational thing to do if trying to save $$$ at the ed of the day is drive to Buffalo or Bellingham. The regulatory environment is favorable for consumers. Plus the cheese at trader joe's is cheap.
Last edited by tcook052; Jun 12, 2015 at 11:25 am Reason: merge posts
Jun 12, 2015, 11:19 am
#92
Join Date: Feb 2014
Posts: 186
Most airports offer some sort of incentive to new airlines, will these get it? I don't know - but it would make smart business sense for the airport which has what 300,000 passengers in a city of 500,000.
Jun 12, 2015, 11:32 am
#93
Join Date: Dec 2008
Posts: 797
Well, except the market isn't just Canada. We are making use of our geography to source many pax going to/from the US. Also, looking at one of the primary routes of the 77P (YUL-CDG), that's one of the largest markets out there (next to NYC-LON). Not a LCC aircraft, just one better suited to the market.
True, except that FR benefits from much (legal) cabotage, so can look for the best location to utilise its assets. They have dense population centres. They can also source crews from lower-paying parts of the Eurozone, don't have to worry about paying benefits, they don't have to deal with delays or IRROPS (they just cancel their flights), they don't have employee pensions, they hawk e-cigarettes and car insurance midflight, the seats don't recline, they charge to print BPs at the airport, etc. Which is great for them, they've made a model that works. All this to say rouge is far, far from a ULCC, and I highly doubt any new entrant in Canada will make any money offering $15 fares on YQT-YXE.
I get what you're saying, but personally I believe it's simply a pipe dream.
True, except that FR benefits from much (legal) cabotage, so can look for the best location to utilise its assets. They have dense population centres. They can also source crews from lower-paying parts of the Eurozone, don't have to worry about paying benefits, they don't have to deal with delays or IRROPS (they just cancel their flights), they don't have employee pensions, they hawk e-cigarettes and car insurance midflight, the seats don't recline, they charge to print BPs at the airport, etc. Which is great for them, they've made a model that works. All this to say rouge is far, far from a ULCC, and I highly doubt any new entrant in Canada will make any money offering $15 fares on YQT-YXE.
I get what you're saying, but personally I believe it's simply a pipe dream.
We are in complete agreement on this.
From a quantitative and qualitative perspective, I can't conjure up any sort of realistic business case that would allow a Cdn domiciled ULCC to survive an annual business cycle in Canada. Add very questionable management prowess in two of the three and the odds don't look very good.
The U.S. ULCC's don't need to be in Canada. 90% of the Canadian population lives within 200 miles of the border, where taxes, seen and unseen, are far less expensive. They can can happily perch on the border and operate business as usual.
If investors are prepared to underwrite some pretty horrific losses by constantly pumping in cash, they could extend the misery for a bit, but the harsh reality is that for a myriad of reasons that are way beyond the scope of this forum or an "in depth" article in the Globe and Mail, I don't see a successful ULCC in Canada anytime soon.
Success is not putting bums in seats. It's making sustainable and consistent profits by putting bums in seats and doing it regardless of the oil price variations we've seen in the past 5 years.
Big difference.
Jun 12, 2015, 11:52 am
#94
Join Date: Dec 2008
Posts: 797
After 15+ years in the market, WJ has a pretty good idea what works from YHM, what doesn't, and when.
WJ learned long ago that flights from secondary urban markets to other secondary urban airports rarely work.
Greyhound learned the hard way that non-stop trumps one stop trans-con every time. That may have not been the case in the DC9/737-200/300/MD80/727 era as that iron did not have reliable trans-con capability, but that all changed with the NG/Airbus/Emb era.
Jun 12, 2015, 11:54 am
#96
Join Date: Feb 2010
Location: YYZ / FRA
Programs: IHG RA; Avis First
Posts: 1,444
This is always good news doesn't matter how small, thats where usually companies start. The best move for AC not care about this small airline 
and continue to increase prices and decrease Altitude enhancements.
and continue to increase prices and decrease Altitude enhancements.
Jun 12, 2015, 1:28 pm
#97
Join Date: Mar 2005
Programs: fwp blood diamond, dykwia uranium
Posts: 7,252
One of them (among the many) is that they can deliberately put FA bases in areas that pay less, (something I'm not against and if you are against this AND use ryanair, you are a hypocrite). Another is Lisbon-Prague is closer than YVR-YYZ for chrissakes. Another is that they operate in airports/old military bases where airports are not glorified bureaucracies that support the federal government's mandate/policy of airports as piggy banks. We can't have it both ways. Canada's too expensive and too big.
Jun 12, 2015, 3:44 pm
#98
Join Date: Aug 2010
Posts: 3,130
Yeah but those european airlines have geographical realities that help them to succeed, realities that make Canada so unappealing to invest air service into.
One of them (among the many) is that they can deliberately put FA bases in areas that pay less, (something I'm not against and if you are against this AND use ryanair, you are a hypocrite). Another is Lisbon-Prague is closer than YVR-YYZ for chrissakes. Another is that they operate in airports/old military bases where airports are not glorified bureaucracies that support the federal government's mandate/policy of airports as piggy banks. We can't have it both ways. Canada's too expensive and too big.
One of them (among the many) is that they can deliberately put FA bases in areas that pay less, (something I'm not against and if you are against this AND use ryanair, you are a hypocrite). Another is Lisbon-Prague is closer than YVR-YYZ for chrissakes. Another is that they operate in airports/old military bases where airports are not glorified bureaucracies that support the federal government's mandate/policy of airports as piggy banks. We can't have it both ways. Canada's too expensive and too big.
1. Geography is a moot point. These airlines aren't going to serve every single airport in the country. They'll likely focus on underserved airports. If those exist, they'll succeed. I think there may well be.
2. Europe has much stiffer competition for air travel. Since we're talking geography, can you imagine the impact a high speed rail service like AVE or ICE or TGV would have on the golden triangle (YOW/YUL/YYZ)? The only routes that can sustain 3 carriers will get decimated. Canada is nowhere nearly as competitive as Europe.
3. Agreed on the aviation cash cow.
4. Investment. I didn't know the limit on foreign investment was so low. Makes me think of Telecom. Nobody in the country may wish to take on AC but if foreign capital were available....well we saw how Telecom stocks performed when the Verizon rumor spread. In short, it's a problem that can be easily rectified. Granted, there's no appetite.
I don't have a horse in the race. I think they'll succeed purely on three assumptions:
1. They can stimulate demand by dropping prices below incumbents. They don't have to offer FR fares to achieve that. Just lower. This is based partly on the commonly held view here that people will choose the cheapest option above all.
2. The value for money proposition delta between the a ULCC and WS or RV domestic will likely be in the ULCC favor because the gap in quality is unlikely to be much.
3. They are going to adopt a ULCC structure. No pensions, benefits etc. Just McDonalds jobs.
Sure it's expensive to operate here, but their is also a market for dirt cheap goods that may provide a better value proposition - if only by virtue of being cheaper.
If I m wrong, i m wrong. If I m right, Canada will be better off for it.
Jun 12, 2015, 7:17 pm
#99
Join Date: Mar 2013
Location: YYZ
Programs: Aeroplan, 50K Altitude, Nexus
Posts: 339
WJ operates 3x daily to YYC, plus n/s to Edmonton, Moncton and Halifax out of Hamilton.
After 15+ years in the market, WJ has a pretty good idea what works from YHM, what doesn't, and when.
WJ learned long ago that flights from secondary urban markets to other secondary urban airports rarely work.
Greyhound learned the hard way that non-stop trumps one stop trans-con every time. That may have not been the case in the DC9/737-200/300/MD80/727 era as that iron did not have reliable trans-con capability, but that all changed with the NG/Airbus/Emb era.
After 15+ years in the market, WJ has a pretty good idea what works from YHM, what doesn't, and when.
WJ learned long ago that flights from secondary urban markets to other secondary urban airports rarely work.
Greyhound learned the hard way that non-stop trumps one stop trans-con every time. That may have not been the case in the DC9/737-200/300/MD80/727 era as that iron did not have reliable trans-con capability, but that all changed with the NG/Airbus/Emb era.
They rarely work under their business model.
This new company, frankly will probably fail, but no one has attempted a real ULCC model in this country the way it's run by Spirit of Ryanair so maybe they will succeed and drive down the price of trans cons flights. Or at least give people cheap flights till they run out of cash.
Maybe I'm just upset cause I just booked a Sunday- Wedensday YYZ-YVR trip for 1500.
Jan 6, 2016, 12:04 pm
#100
Join Date: Jun 1999
Location: YVR
Programs: ACSEMM QRGold SPGLifetimePlat FairmontPlat HyattD AMEXCenturion SerenaPlat TalkBoard Founding Member
Posts: 8,963
New no-frills air carrier NewLeaf is offering introductory fares as low as $89 for flights between Winnipeg and select Canadian cities.
NewLeaf Travel will offer non-stop flights from its main bases in Winnipeg, Hamilton, Ont., and Kelowna, B.C., to multiple destinations starting Feb. 12.
NewLeaf Travel will offer non-stop flights from its main bases in Winnipeg, Hamilton, Ont., and Kelowna, B.C., to multiple destinations starting Feb. 12.
http://www.cbc.ca/news/canada/manito...owna-1.3389775
Route map: http://flynewleaf.ca/travel-info/route-map-south/
Jan 6, 2016, 1:53 pm
#101
Join Date: Nov 2015
Location: YOW
Programs: AC 75K
Posts: 583
Jan 6, 2016, 4:25 pm
#105
Join Date: Feb 2013
Location: Never home.
Posts: 2,971
But that $200 is assuming essentially no carry-on baggage. $25 each way for regular sized carry-on if you pay at booking, and $80 at the gate.
They will probably shut themselves down. Charging for carry-on in Canada won't be popular, and flying from 3rd tier cities with small populations is unlikely to be a smashing success. Paying to charter aircraft from Flair adds another layer of cost.
Seems like PEOPLExpress.
If their IT is as good as it seems, they may not even get off the ground.
Last edited by winnipegrev; Jan 6, 2016 at 4:31 pm