AC Comments on Proposed Transportation Modernization Act (Passenger Bill of Rights)
Jul 14, 2018, 5:30 am
#121
Join Date: May 2012
Location: Calgary
Programs: Aeroplan (Silver), Air Miles, IHG Rewards (Platinum)
Posts: 668
The argument that a customer somehow “agrees” to unfavourable terms buried in the tariff is simply silly. Equally silly is the notion that if you don’t like it you should choose another airline. The reality is that the airlines have colluded (tacitly or otherwise) to put in place tariffs that have legal standing but are grossly one sided and unfair to the consumer. But we are forced to accept these terms (not necessarily agree to them) because there is effectively no other choice. This is why we need a passenger bill of rights. Unfortunately, the way these things go it very likely won’t do anything to solve the problem.
As a consumer, as long as I am aware of the rules, then that is good enough for me to know if I want to conduct business with a company. I truly believe AC is upfront enough with the fact they overbook and that the compensation levels are spelled out. That should be all the government involvement there needs to be, aside from also holding them to account like the CTA consumer complaint process is in place for when there is a tariff violation. If you don't like the airlines terms/tariff, don't book a ticket with them.
Jul 14, 2018, 8:44 am
#122
Suspended
Join Date: Nov 2007
Location: YVR
Programs: Air Canada Super Elite 2+ Million Miles
Posts: 2,478
What unfavourable term is buried in the tariff? IDB? That is a well known fact, not a buried footnote. And the rules for IDB are clearly laid out. I for one appreciate overbooking. More inventory, more competitive pricing. I have seen people rush and fight to get VDB as it can be pretty generous at times. And during IROP's, imagine no overbooking? You would have to wait ages to get a seat out.
As a consumer, as long as I am aware of the rules, then that is good enough for me to know if I want to conduct business with a company. I truly believe AC is upfront enough with the fact they overbook and that the compensation levels are spelled out. That should be all the government involvement there needs to be, aside from also holding them to account like the CTA consumer complaint process is in place for when there is a tariff violation. If you don't like the airlines terms/tariff, don't book a ticket with them.
As a consumer, as long as I am aware of the rules, then that is good enough for me to know if I want to conduct business with a company. I truly believe AC is upfront enough with the fact they overbook and that the compensation levels are spelled out. That should be all the government involvement there needs to be, aside from also holding them to account like the CTA consumer complaint process is in place for when there is a tariff violation. If you don't like the airlines terms/tariff, don't book a ticket with them.
we should however distinguish between run-of-the-mill complaints the fall under CTA jurisdiction, and of course extraordinary accusations which is the point of the thread Wong versus AirCanada, and even in that situation, the courts exist, which are known to be pretty fair in this country, compared to many other places I go.
Fine line between consumer protection and the nanny state… definitely Worthy of debate here, but the name-calling demonstrates this:
When intellect fails, insults usually will do.
Jul 14, 2018, 12:17 pm
#123
Join Date: Aug 2010
Posts: 3,130
while I agree completely with your post, don’t you realize that putting logic down here is viewed by others as “silly“.
we should however distinguish between run-of-the-mill complaints the fall under CTA jurisdiction, and of course extraordinary accusations which is the point of the thread Wong versus AirCanada, and even in that situation, the courts exist, which are known to be pretty fair in this country, compared to many other places I go.
"The current system, based on one-off rulings by the Canadian Transportation Agency in response to complaints, is producing suboptimal, piecemeal outcomes for industry, consumers, and the regulator alike."
It aims to address this by increasing CTA jurisdiction:
"providing the Canadian Transportation Agency with the power to undertake inves. tigations on its own motion so that it may report on and resolve systemic issues, as well as general order powers so that rulings may be applied to all carriers"
Broadly speaking, it also recommends:
"enacting legislation or regulations that define rights and remedies that are as harmonized as possible with those of the U.S. and the European Union, and that apply to all carriers serving Canada"
Do you disagree with the reports findings and recommendations? If so, why?
Hmmmm?
What was that all about? In your opinion, what does it say about your intellect/the strength of your arguments?
Last edited by yulred; Jul 14, 2018 at 12:27 pm
Jul 14, 2018, 6:25 pm
#124
Suspended
Join Date: Nov 2007
Location: YVR
Programs: Air Canada Super Elite 2+ Million Miles
Posts: 2,478
I can think of a systemic failure the legislation fails to address that impacts far greater numbers of Cdn travellers than IDB.
How dare Parliament enact this legislation that does NOT protect all of us from corporately determined in-cabin service failures, whether they be the case of Sunwing that is NOW getting national attention, or the complaints on this Forum about missing Kit-Kats.
https://www.cbc.ca/news/canada/montr...ting-1.4362288
Why should plaintiffs be forced to the expense and hassle of class action lawsuit, when Parliament could have covered both these circumstances, and others through the CTA mandate.
you cite the words of the CTA review (pg. 205), yet the current Government is ignoring plenty other recommendations from the pre-eminent Dr. Emerson (full disclosure one of the best bosses I ever had) - despite my favoured view of Dr. Emerson, I agree with some but NOT all of the findings, and thus one does NOT intellectually need to fall for everything is perfect perspective or everything is a failure - if I understand correctly that is the attempt in your question whether I agree or not.
Canada Transportation Act Review - Report - Government of Canada
e.g. I disagree that General Revenues should be used to support the industry, albeit, for access to remote communities this may be justified, but in this case must come from Social development earmarked funds, NOT from transportation generated taxes.
Where we do agree is pretty fine line between intellect and humour - and I will keep my day job as evident from my attempts at humour, failing on this account.
How dare Parliament enact this legislation that does NOT protect all of us from corporately determined in-cabin service failures, whether they be the case of Sunwing that is NOW getting national attention, or the complaints on this Forum about missing Kit-Kats.
https://www.cbc.ca/news/canada/montr...ting-1.4362288
Why should plaintiffs be forced to the expense and hassle of class action lawsuit, when Parliament could have covered both these circumstances, and others through the CTA mandate.
you cite the words of the CTA review (pg. 205), yet the current Government is ignoring plenty other recommendations from the pre-eminent Dr. Emerson (full disclosure one of the best bosses I ever had) - despite my favoured view of Dr. Emerson, I agree with some but NOT all of the findings, and thus one does NOT intellectually need to fall for everything is perfect perspective or everything is a failure - if I understand correctly that is the attempt in your question whether I agree or not.
Canada Transportation Act Review - Report - Government of Canada
e.g. I disagree that General Revenues should be used to support the industry, albeit, for access to remote communities this may be justified, but in this case must come from Social development earmarked funds, NOT from transportation generated taxes.
Where we do agree is pretty fine line between intellect and humour - and I will keep my day job as evident from my attempts at humour, failing on this account.
Jul 15, 2018, 12:00 am
#125
Suspended
Join Date: Nov 2007
Location: YVR
Programs: Air Canada Super Elite 2+ Million Miles
Posts: 2,478
Alternate Thesis
In further considering my post #1043 , may I beg all of your indulgences as with EU to SE Asia jet-lag, party late into night in BKK, and pre-dawn wake-up call for flight to CGK, another perspective becomes evident after some more rest.
Dr. D.L. Emerson could rightly ask of me how it is that I readily accept the thesis that the Transportation Act Review recommendations are so easily divisible, and that maybe I have fallen into the political trap of solely debating the lowest common denominator. And this observation would be particularly poignant on his part, as long ago he relied on me for this very type of synthetic advice on how best to develop airport strategy within the globe’s civil aviation network when he first arrived at YVR from high-finance as a Bank President and previously as the Chief of Staff in the BC government.
Consequently, with my re-read of the Review recommendations today, it becomes abundantly evident that the divisibility challenge is real, and can have material implications for Canada overall. Thus, extracting excerpts, such as from pg. 205, for posting here in support of vote-getting consumer protection efforts may in reality be meaningless. Dr. Emerson would also likely remind me that the Review makes many trade-offs within and between transportation modes (especially around the competition between goods movements operators), together with consideration of broader policy goals. Need I remind all of today’s charged times of global trade friction that must include far greater attention to building a resilent global trading framework, all of which, at least in my estimation that echoes Dr. Emerson’s numerous public statements to this end, we must NOT ignore effective policy integration and avoid our long-term peril by repairing the already abundant internal policy conflicts at the level of GoC (and let’s NOT forget that Dr. Emerson, prior to this particular leadership assignment, represented Her Majesty as Canada’s Minister of International Trade).
And all this warrants an example, and many will be surprise that I start with your PENSION and related long-term financial investments. Starting with CPP (indirectly) and Caisse Depot & Ontario Public/Teacher Pension funds who are directly invested in Airports abroad – while this is good source of return on invested equity, yet, this exposes pensions of Cdns to currency, geo-political and even domestic expropriation risks as we are hearing might occur in S. America soon. Well, GoC has accepted the recommendation for airline ownership to 49% but NOT the recommendation to privatize the airports – and of course AC opposes privatization for fear of higher user fees. But for those of us involved in airport finance, the Cdn model is seriously broken, and with YVR just announcing $9 billion capital plan over next 20 years – yeah was chorus, but with 33 years remaining on lease, and NO guarantee of an extension – the only way this gets paid for is with skyrocketing user fees. Back to your pension, guess who wishes to invest in private Cdn airports, you got it, Cdn pension funds who are desperate to repatriate these funds into high quality long-term assets, but with NO equity provisions at present this can’t happen. And guess also why you see schism between Minister of Finance who comes from pension industry, and the PM that has just thrown his hands in the air over this remarkably complex subject. Trade offs abound and I could write volumes on this topic alone.
And this brings us back to the circumstances of this Thread, which deals with the Modernization Act, writ large, NOT just the IDB compensation and consumer protection elements as this legislation also changes other crucial matters to the development of Canada’s air transportation networks. Yet, the more important question for those following this Thread is whether the CURRENT Government of Canada in ignoring, and in fact publicly de-riding other elements of the Review Recommendations are too making the divisibility error, if in fact the recommendations were NEVER intended to be divided in the first place.
Next time I see David I will ask him about this divisibilty thesis, and yes, I know him well enough to call him by his first name, although I would NEVER be so rude to do so in a formal setting.
In further considering my post #1043 , may I beg all of your indulgences as with EU to SE Asia jet-lag, party late into night in BKK, and pre-dawn wake-up call for flight to CGK, another perspective becomes evident after some more rest.
Dr. D.L. Emerson could rightly ask of me how it is that I readily accept the thesis that the Transportation Act Review recommendations are so easily divisible, and that maybe I have fallen into the political trap of solely debating the lowest common denominator. And this observation would be particularly poignant on his part, as long ago he relied on me for this very type of synthetic advice on how best to develop airport strategy within the globe’s civil aviation network when he first arrived at YVR from high-finance as a Bank President and previously as the Chief of Staff in the BC government.
Consequently, with my re-read of the Review recommendations today, it becomes abundantly evident that the divisibility challenge is real, and can have material implications for Canada overall. Thus, extracting excerpts, such as from pg. 205, for posting here in support of vote-getting consumer protection efforts may in reality be meaningless. Dr. Emerson would also likely remind me that the Review makes many trade-offs within and between transportation modes (especially around the competition between goods movements operators), together with consideration of broader policy goals. Need I remind all of today’s charged times of global trade friction that must include far greater attention to building a resilent global trading framework, all of which, at least in my estimation that echoes Dr. Emerson’s numerous public statements to this end, we must NOT ignore effective policy integration and avoid our long-term peril by repairing the already abundant internal policy conflicts at the level of GoC (and let’s NOT forget that Dr. Emerson, prior to this particular leadership assignment, represented Her Majesty as Canada’s Minister of International Trade).
And all this warrants an example, and many will be surprise that I start with your PENSION and related long-term financial investments. Starting with CPP (indirectly) and Caisse Depot & Ontario Public/Teacher Pension funds who are directly invested in Airports abroad – while this is good source of return on invested equity, yet, this exposes pensions of Cdns to currency, geo-political and even domestic expropriation risks as we are hearing might occur in S. America soon. Well, GoC has accepted the recommendation for airline ownership to 49% but NOT the recommendation to privatize the airports – and of course AC opposes privatization for fear of higher user fees. But for those of us involved in airport finance, the Cdn model is seriously broken, and with YVR just announcing $9 billion capital plan over next 20 years – yeah was chorus, but with 33 years remaining on lease, and NO guarantee of an extension – the only way this gets paid for is with skyrocketing user fees. Back to your pension, guess who wishes to invest in private Cdn airports, you got it, Cdn pension funds who are desperate to repatriate these funds into high quality long-term assets, but with NO equity provisions at present this can’t happen. And guess also why you see schism between Minister of Finance who comes from pension industry, and the PM that has just thrown his hands in the air over this remarkably complex subject. Trade offs abound and I could write volumes on this topic alone.
And this brings us back to the circumstances of this Thread, which deals with the Modernization Act, writ large, NOT just the IDB compensation and consumer protection elements as this legislation also changes other crucial matters to the development of Canada’s air transportation networks. Yet, the more important question for those following this Thread is whether the CURRENT Government of Canada in ignoring, and in fact publicly de-riding other elements of the Review Recommendations are too making the divisibility error, if in fact the recommendations were NEVER intended to be divided in the first place.
Next time I see David I will ask him about this divisibilty thesis, and yes, I know him well enough to call him by his first name, although I would NEVER be so rude to do so in a formal setting.
Jul 15, 2018, 6:30 am
#126
Join Date: Aug 2010
Posts: 3,130
Alternate Thesis
In further considering my post #1043 , may I beg all of your indulgences as with EU to SE Asia jet-lag, party late into night in BKK, and pre-dawn wake-up call for flight to CGK, another perspective becomes evident after some more rest.
Dr. D.L. Emerson could rightly ask of me how it is that I readily accept the thesis that the Transportation Act Review recommendations are so easily divisible, and that maybe I have fallen into the political trap of solely debating the lowest common denominator. And this observation would be particularly poignant on his part, as long ago he relied on me for this very type of synthetic advice on how best to develop airport strategy within the globe’s civil aviation network when he first arrived at YVR from high-finance as a Bank President and previously as the Chief of Staff in the BC government.
Consequently, with my re-read of the Review recommendations today, it becomes abundantly evident that the divisibility challenge is real, and can have material implications for Canada overall. Thus, extracting excerpts, such as from pg. 205, for posting here in support of vote-getting consumer protection efforts may in reality be meaningless. Dr. Emerson would also likely remind me that the Review makes many trade-offs within and between transportation modes (especially around the competition between goods movements operators), together with consideration of broader policy goals. Need I remind all of today’s charged times of global trade friction that must include far greater attention to building a resilent global trading framework, all of which, at least in my estimation that echoes Dr. Emerson’s numerous public statements to this end, we must NOT ignore effective policy integration and avoid our long-term peril by repairing the already abundant internal policy conflicts at the level of GoC (and let’s NOT forget that Dr. Emerson, prior to this particular leadership assignment, represented Her Majesty as Canada’s Minister of International Trade).
And all this warrants an example, and many will be surprise that I start with your PENSION and related long-term financial investments. Starting with CPP (indirectly) and Caisse Depot & Ontario Public/Teacher Pension funds who are directly invested in Airports abroad – while this is good source of return on invested equity, yet, this exposes pensions of Cdns to currency, geo-political and even domestic expropriation risks as we are hearing might occur in S. America soon. Well, GoC has accepted the recommendation for airline ownership to 49% but NOT the recommendation to privatize the airports – and of course AC opposes privatization for fear of higher user fees. But for those of us involved in airport finance, the Cdn model is seriously broken, and with YVR just announcing $9 billion capital plan over next 20 years – yeah was chorus, but with 33 years remaining on lease, and NO guarantee of an extension – the only way this gets paid for is with skyrocketing user fees. Back to your pension, guess who wishes to invest in private Cdn airports, you got it, Cdn pension funds who are desperate to repatriate these funds into high quality long-term assets, but with NO equity provisions at present this can’t happen. And guess also why you see schism between Minister of Finance who comes from pension industry, and the PM that has just thrown his hands in the air over this remarkably complex subject. Trade offs abound and I could write volumes on this topic alone.
And this brings us back to the circumstances of this Thread, which deals with the Modernization Act, writ large, NOT just the IDB compensation and consumer protection elements as this legislation also changes other crucial matters to the development of Canada’s air transportation networks. Yet, the more important question for those following this Thread is whether the CURRENT Government of Canada in ignoring, and in fact publicly de-riding other elements of the Review Recommendations are too making the divisibility error, if in fact the recommendations were NEVER intended to be divided in the first place.
Next time I see David I will ask him about this divisibilty thesis, and yes, I know him well enough to call him by his first name, although I would NEVER be so rude to do so in a formal setting.
In further considering my post #1043 , may I beg all of your indulgences as with EU to SE Asia jet-lag, party late into night in BKK, and pre-dawn wake-up call for flight to CGK, another perspective becomes evident after some more rest.
Dr. D.L. Emerson could rightly ask of me how it is that I readily accept the thesis that the Transportation Act Review recommendations are so easily divisible, and that maybe I have fallen into the political trap of solely debating the lowest common denominator. And this observation would be particularly poignant on his part, as long ago he relied on me for this very type of synthetic advice on how best to develop airport strategy within the globe’s civil aviation network when he first arrived at YVR from high-finance as a Bank President and previously as the Chief of Staff in the BC government.
Consequently, with my re-read of the Review recommendations today, it becomes abundantly evident that the divisibility challenge is real, and can have material implications for Canada overall. Thus, extracting excerpts, such as from pg. 205, for posting here in support of vote-getting consumer protection efforts may in reality be meaningless. Dr. Emerson would also likely remind me that the Review makes many trade-offs within and between transportation modes (especially around the competition between goods movements operators), together with consideration of broader policy goals. Need I remind all of today’s charged times of global trade friction that must include far greater attention to building a resilent global trading framework, all of which, at least in my estimation that echoes Dr. Emerson’s numerous public statements to this end, we must NOT ignore effective policy integration and avoid our long-term peril by repairing the already abundant internal policy conflicts at the level of GoC (and let’s NOT forget that Dr. Emerson, prior to this particular leadership assignment, represented Her Majesty as Canada’s Minister of International Trade).
And all this warrants an example, and many will be surprise that I start with your PENSION and related long-term financial investments. Starting with CPP (indirectly) and Caisse Depot & Ontario Public/Teacher Pension funds who are directly invested in Airports abroad – while this is good source of return on invested equity, yet, this exposes pensions of Cdns to currency, geo-political and even domestic expropriation risks as we are hearing might occur in S. America soon. Well, GoC has accepted the recommendation for airline ownership to 49% but NOT the recommendation to privatize the airports – and of course AC opposes privatization for fear of higher user fees. But for those of us involved in airport finance, the Cdn model is seriously broken, and with YVR just announcing $9 billion capital plan over next 20 years – yeah was chorus, but with 33 years remaining on lease, and NO guarantee of an extension – the only way this gets paid for is with skyrocketing user fees. Back to your pension, guess who wishes to invest in private Cdn airports, you got it, Cdn pension funds who are desperate to repatriate these funds into high quality long-term assets, but with NO equity provisions at present this can’t happen. And guess also why you see schism between Minister of Finance who comes from pension industry, and the PM that has just thrown his hands in the air over this remarkably complex subject. Trade offs abound and I could write volumes on this topic alone.
And this brings us back to the circumstances of this Thread, which deals with the Modernization Act, writ large, NOT just the IDB compensation and consumer protection elements as this legislation also changes other crucial matters to the development of Canada’s air transportation networks. Yet, the more important question for those following this Thread is whether the CURRENT Government of Canada in ignoring, and in fact publicly de-riding other elements of the Review Recommendations are too making the divisibility error, if in fact the recommendations were NEVER intended to be divided in the first place.
Next time I see David I will ask him about this divisibilty thesis, and yes, I know him well enough to call him by his first name, although I would NEVER be so rude to do so in a formal setting.
Jul 15, 2018, 8:44 am
#127
Suspended
Join Date: Nov 2007
Location: YVR
Programs: Air Canada Super Elite 2+ Million Miles
Posts: 2,478
And in the policy world, these choices as we all know can take on a heavy partisan element, where short term gains for politicians (e.g. for upcoming 2019 voting cycle) are heavily weighted against the future, as who really cares what the next batch of politicians will face from their predecessors actions. The public definitely should care, and of course we routinely get calls that politicians are too shortsighted.
And while I do not agree with the current government legislative action on IDB, so we can agree to disagree I suppose, but how do we get to this situation. Pretty simple, multiple previous govts of both stripes in their efforts to liberalize the industry chose NOT to take on IDB oriented consumer protection policies, leading to the current calls for action.
as I'm overseas, do not have handy my copy of the 1985 Royal Commission on the Future of Transportation (the project's research director, Dr. BIll Waters from UBC Economics Dept was one of my most favourite professors, and unfortunately has long passed away). One would need to go back to this seminal policy document (which went much further than the recent Emerson led effort) to see what was recommended then, whether consumer protection was on the table and to what degree, and how then Minister Crosbie and the Cabinet of the day reacted to the propositions at hand. Well, it has taken +30 years to get the current government to take action on IDB and other important matters - so we really cannot understand where we are today without understanding where we came from so if anyone has this document, please let us know what it says on airline ownership, consumer protections, airport operations (this I know about), foreign bilateral relations, etc...
I can agree that sometimes a policy topic is a policy topic that stands alone - however, given that the industry lobby group (which is what they get paid to do) says IDB will cause harm and industry is more than capable to protect itself, my bet is the AC response may NOT become evident to the public, but let's NOT pretend AC will just hand the bill for this GoC promise to shareholders - don't think so...
btw...it would be pretty bold for AC to pull a RyanAir on passenger compensation, when EU largest airline added 2 Euro in 2011 in an upfront and public way to stick their thumb in Brussell's eyes.
https://www.theguardian.com/business...ensation-eu261
Jul 16, 2018, 2:01 am
#128
Original Member
Join Date: May 1998
Location: Vancouver, Canada
Posts: 6,222
Economics the study of the allocation of limited resources. To claim that any particular action "hurts" the "economy" is absurd.
In every economic policy decision there are groups that will come out ahead (winners) and those that will come out behind (losers). (There's also a 3rd group that may not be affected at all.) To say the policy decision "hurt's" the economy is meaningless.
As well, to claim that a 10 cent increase (or decrease - I can't tell from your claims) in Air Canada's ticket prices would adversely affect "the economy" is equally absurd. Either the theoretical effect on any given person or group of persons will be so small as to be immaterial, or, the economy is so desperately tied to Air Canada that absolutely every aspect of their operation, including finances, needs to be strictly and completely regulated.
If you are going to claim that 10 cents on each of some ~34 million tickets are year is going to take ~3.4 million dollars out of the economy because it's going to the government, then you are also way off the mark. The government is not going to just bury the cash in the back yard of the Minister of Finance. They are going to spend it -- either by paying civil service employees who will in turn either save, invest or spend it back into the private economy, or they will purchase goods and/or services, also from the private economy, thus once again returning that "tax" into the "economy."
Moreover, it's not like "no one" is going to receive any benefit from that 10 cent surcharge, particularly if the plan is to use it to finance protections for displaced passengers, or even just to finance the implementation of policy to protect the rights of passengers. Like paying for a fire department that you hope you never need, this anticipated benefit is herd protection from exceptionally concentrated points of power and influence.
There are a lot of smart, intelligent, educated, motivated, creative and generous people in this forum.
Your claim to fame seems to be to anonymously claim that you're smarter than the lot of them, because of a claimed (but not demonstrated) background in all 3 levels of government (or maybe as a lobbyist?,) casual implications and allusions to a claimed education, and to drop the names of people you think are famous enough to impress the starry-eyed participants in this forum. So many of your claims and even questions are such eye-rollers that I don't buy any of it.
Jul 16, 2018, 7:55 am
#130
Join Date: Jan 2017
Location: Halifax
Programs: AC SE100K, Marriott Lifetime Platinum Elite. NEXUS
Posts: 4,562
If you are going to claim that 10 cents on each of some ~34 million tickets are year is going to take ~3.4 million dollars out of the economy because it's going to the government, then you are also way off the mark. The government is not going to just bury the cash in the back yard of the Minister of Finance. They are going to spend it -- either by paying civil service employees who will in turn either save, invest or spend it back into the private economy, or they will purchase goods and/or services, also from the private economy, thus once again returning that "tax" into the "economy."
Jul 16, 2018, 8:13 am
#131
Suspended
Join Date: Nov 2007
Location: YVR
Programs: Air Canada Super Elite 2+ Million Miles
Posts: 2,478
And the increase in ticket prices (because of increase obligations) isn't going to go to the government, anyway. If the obligation is for some higher OTA, or a regulated SLA for answering the phone, or whatever, then the increase in ticket price would go to cover that minimum.
https://www.iata.org/whatwedo/Docume...Study_2007.pdf
In sum, NO FREE LUNCH, despite those who will say price elasticity of demand is Fake News and it all washes out in the end...
Last edited by skybluesea; Jul 16, 2018 at 8:19 am
Jul 16, 2018, 8:33 am
#133
Suspended
Join Date: Nov 2007
Location: YVR
Programs: Air Canada Super Elite 2+ Million Miles
Posts: 2,478
And since this legislation now allows up to 49% of AC shares to be sold out of Canada, this increased wealth just flows out of the country. I could go on, but lots of smart folks out there that KNOW better than believing increasing obligations on corporations does not matter to Canada competitiveness, the wealth distribution from economic activity, and just plain common sense.
Last edited by skybluesea; Jul 16, 2018 at 8:38 am
Jul 16, 2018, 8:42 am
#134
Join Date: Jan 2017
Location: Halifax
Programs: AC SE100K, Marriott Lifetime Platinum Elite. NEXUS
Posts: 4,562
What more profit?
If the increased costs due to regulation is X and AC shareholders expect a Y% ROI, then ticket prices will go up X+Y*X. Total margins will still be Y%.
Basic economic theory would suggest that as prices go up consumption goes down, but it could well be the case today that the lowest price today is lower then the price consumers are willing to pay. Impossible to know, and airline RM departments are generally good at this. But AC (and WS) could well support a $10/ticket increase with zero decrease in traveling. Indeed, the high load levels that exist today would suggest that that is exactly what would happen.
Actually, since the race to the bottom has many people disgusted with the service, they might not fly at all; Those who 20 years ago might have flown in business might not fly at all because of the huge violent pain that flying is today. AC (and WS) charging $10 more and thus offering service not comparable to a cell phone company might increase sales. But WS and AC are in a spiral to cheap, focusing on that local optimization before all others.
If the increased costs due to regulation is X and AC shareholders expect a Y% ROI, then ticket prices will go up X+Y*X. Total margins will still be Y%.
Basic economic theory would suggest that as prices go up consumption goes down, but it could well be the case today that the lowest price today is lower then the price consumers are willing to pay. Impossible to know, and airline RM departments are generally good at this. But AC (and WS) could well support a $10/ticket increase with zero decrease in traveling. Indeed, the high load levels that exist today would suggest that that is exactly what would happen.
Actually, since the race to the bottom has many people disgusted with the service, they might not fly at all; Those who 20 years ago might have flown in business might not fly at all because of the huge violent pain that flying is today. AC (and WS) charging $10 more and thus offering service not comparable to a cell phone company might increase sales. But WS and AC are in a spiral to cheap, focusing on that local optimization before all others.
Jul 16, 2018, 8:57 am
#135
Join Date: Aug 2010
Posts: 3,130
No, not at all, my post just posits an alternate thesis, recognizing that taking one recommendation and not another can have significant unintended consequences as they may very well be related, directly or indirectly.
And in the policy world, these choices as we all know can take on a heavy partisan element, where short term gains for politicians (e.g. for upcoming 2019 voting cycle) are heavily weighted against the future, as who really cares what the next batch of politicians will face from their predecessors actions. The public definitely should care, and of course we routinely get calls that politicians are too shortsighted.
And while I do not agree with the current government legislative action on IDB, so we can agree to disagree I suppose, but how do we get to this situation. Pretty simple, multiple previous govts of both stripes in their efforts to liberalize the industry chose NOT to take on IDB oriented consumer protection policies, leading to the current calls for action.
as I'm overseas, do not have handy my copy of the 1985 Royal Commission on the Future of Transportation (the project's research director, Dr. BIll Waters from UBC Economics Dept was one of my most favourite professors, and unfortunately has long passed away). One would need to go back to this seminal policy document (which went much further than the recent Emerson led effort) to see what was recommended then, whether consumer protection was on the table and to what degree, and how then Minister Crosbie and the Cabinet of the day reacted to the propositions at hand. Well, it has taken +30 years to get the current government to take action on IDB and other important matters - so we really cannot understand where we are today without understanding where we came from so if anyone has this document, please let us know what it says on airline ownership, consumer protections, airport operations (this I know about), foreign bilateral relations, etc...
I can agree that sometimes a policy topic is a policy topic that stands alone - however, given that the industry lobby group (which is what they get paid to do) says IDB will cause harm and industry is more than capable to protect itself, my bet is the AC response may NOT become evident to the public, but let's NOT pretend AC will just hand the bill for this GoC promise to shareholders - don't think so...
btw...it would be pretty bold for AC to pull a RyanAir on passenger compensation, when EU largest airline added 2 Euro in 2011 in an upfront and public way to stick their thumb in Brussell's eyes.
https://www.theguardian.com/business...ensation-eu261
If we assume the whole thing is for votes, we must ask why this issue animates voters. The airlines unilaterally wrote and imposed the contracts. They had ample time - decades - to listen to consumer feedback and adjust the terms. They chose not to. The people are now using their representatives to fix these issues. Spin it however you want, but the market has failed to find a balance between airlines and consumers. This, in turn, necessitates intervention. As the sole authors of the contract, with the ability to change that contract unilaterally, airlines - not politicians or consumers - are responsible for any regulatory interventions that follow.
This brings us to IDB, an issue you are evidently unfamiliar with. The previous tariff offered $100 as compensation for delays that could exceed 24 hours. Consumers got upset; AC told them to get lost. Eventually the CTA got involved and ruled that it was "unreasonable". You can find details of the ruling, which dates back to 2013, here:
https://www.otc-cta.gc.ca/eng/ruling/204-c-a-2013
Note that this issue was not addressed through legislation. As far as I can tell, no politicians were ever involved. It was simply a case of CTA calling AC out on its IDB policy. The blame for that rests with AC. It was all within the jurisdiction of the CTA, which you claim you support. If you're going to insist on discussing issues, at least have the decency to learn about them first.