Would cabotage ever work?
 

A possible trial run could be between the U.S. and Canada. An even smaller trial could be not to allow a hub but to allow ticketing. For example, Air Canada could be allowed to sell Seattle-New York La Guardia seats via Toronto.

For a U.S. airline to make it work, some sort of Canadian preclearance might help. For example, an end of a concourse could be blocked off and treated like Canadian soil. Southwest could do it at Chicago Midway with flights from Toronto, Montreal, Ottawa, and Halifax continuing on to Vancouver, Edmonton, Calgary, and Victoria. For Chicago passengers or other U.S. originating passengers wanting to go to Canada, they could clear Canadian customs in Chicago. An alternative would be to force Canadians to clear U.S. customs if connecting but that would slow down connections.

American, Delta, and United would probably not want to offend their partners, Westjet and Air Canada. That would leave Southwest as the most likely to be interested.

Recently, I tried flying between a U.S. city, Toronto, Vancouver, and driving to the U.S. What a long trip! It took about 15 hours each way versus 6-8 hours if not through Canada.

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I'm not sure what you're asking.

Anti-cabotage laws are a form of economic protectionism that a government imposes to shield domestic carriers from foreign-carrier competition on domestic routes. Unless and until a majority of the U.S. Senate and a majority of the U.S. House of Representatives feels otherwise, U.S. anti-cabotage laws are here to stay.

I didn't know whether it was legislation or executive branch regulations that prohibited cabotage.

Currently, Air Canada won't even sell you a LAX-YYZ-LGA ticket unless you bought separate tickets. Qantas flies between LAX-JFK but an only fly passengers who originated in Australia and are continuing on to New York.

Another kind of cabotage is if Air Canada would be allowed to set up a U.S. hub but that will never happen.

Some people living in Buffalo choose to fly out of Toronto to another US city. Similarly, people in upstate NY, VT, and NH choose to fly out of Montreal

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"Currently, Air Canada won't even sell you a LAX-YYZ-LGA ticket unless you bought separate tickets."

That's because it's illegal for AC to sell transportation between two points within the U.S. on a single ticket.

The QF JFK-LAX and LAX-JFK flights are permitted, as long as passengers are traveling to or from Australia. (I'm not sure if a QF passenger can have a stopover at LAX, or if only true connections are allowed.)

And I'm pretty sure that Canadian law prohibits U.S. carriers from transporting passengers between two Canadian points via the U.S. on a single ticket.

Cabotage works pretty well in the EU where it is allowed for EU carriers. A few European LCCs like Ryanair, easyJet and Vueling now fly domestic routes outside their home countries. Lufthansa was running an Italian domestic operation for a while, and of course it owns Austrian and Swiss.

Australia and New Zealand have a similar arrangement, and a couple of Australian airlines fly domestically within New Zealand.

But compared to these precedents, it would obviously be a big market game changer to have Canadian hubs competing with US hubs for domestic traffic and vice versa, let alone allowing full cabotage between the two countries...

Would cabotage ever work?
 

Correct, just like in the US, domestic routes can only be served by domestic carriers in Canada.

But as for 5th freedoms, perhaps QF isn't allowed on the domestic segment of their flight to Australia. And I can't think of any purely domestic US tag legs, but know of some Canada-US legs that are/were allowed. BA for example used to be allowed to sell the YYZ - JFK segment of YYZ-JFK-MAN. I believe LY sold LAX-YYZ when that flight stopped on the way to TLV (not anymore). And not sure if they do anymore, but I think JL did YVR-LAS, and Phillipines did YVR-MEX (I may have mixed those last two up). CX still sells JFK-YVR on their flight that continues into HKG. I know AC applied/tried to do YYZ-LAX-SYD, while selling the LAX-SYD portion, but was denied by the DOT. But in the rest of the world, it's common enough. There are a ton of international carriers serving routes like SIN-BKK and CMB-MLE, for example.

As to the OP, really wouldn't work unless both countries allowed it, but still don't know if it would make sense. Especially as you lay it out. For example, both the US and Canada would have to change laws to have a sterile transit as you suggest like there is in Europe/Asia, etc. as both countries have laws requiring each pax to pass through immigration - even if simply doing an international transit.

As for WN being interested, I'm not sure that there is even much interest in them serving Canada, much less selling domestic Canada routings via a US hub. It certainly comes up every few years, but operating in Canada doesn't really fit in a LCC model since costs to operate out of Canadian airports are quite high and would likely cannibalize a lot of the business Canadians already provide at border airports like SEA and BUF.

It must. Just for S&Gs, I tried booking YYZ-YVR on AA.com but because they code share with WestJet, it will allow you to book it as long as the flight in or out of Canada is operated by WS. It does result in some rather creative routings, like YYZ-ORD-DFW-LAX-YVR but you could do it. There was nothing on all AA metal.

Tried the same booking on delta.com, who, AFAIK has no codeshares with Canadian carriers and it didn't allow it. Didn't even bother with UA.com since it would just give me nonstops on AC.

Fifth freedom tags (country B to country C) often have local traffic rights, but tags within a foreign country never do.

While we're fantasizing, one obvious alternative would be for the US and Canada to adopt a Schengen-like system so that there is no passport control between them at all. That would be amazingly good for business in general, not just for travel. Likelihood low, though, especially given all the security paranoia in the US.

Low likelihood is an understatement. I'd love to see it. While Europe is making it easier to cross borders, we're making it more difficult.

I have purchased AAA-YYZ-BBB tickets on AC many times with AAA and BBB being different US cities. It is issued on one ticket, however you are buying 2 fares - AAA-YYZ and YYZ-BBB

Actually, this was being talked about a lot and was somewhat close to happening...before Sept. 2001. But obviously, that changed everything. They were calling it at that time a security perimeter - for around the the U.S., Canada and even potentially Mexico. Don't know how many details were fully worked out but it would have been great - also don't know if they worked out some of the details like for countries who needed visas for the U.S. but not Canada, etc. But the idea was kind of like a schengen zone - imagine how much time that would save travelers leaving YYZ for the U.S. at peak times. Alas, correct, now this is all fantasy.

I have flown AC, HNL-YYZ-MCI on one ticket, but it was 14 years ago. Maybe they have tightened up in recent years.

Doubt that there is much appetite on either the US or Canadian side of the borde for cabotage-y type tickets. And, as to the one-offs such as QF, they might be happy to sell the inbound US segment, but less happy to sell that on the outbound. Same thing for UA on its flights to OZ.

Using the US/Canada example...and removing for a moment the politics and the customs issues...

From a geographical standpoint...and taking into account current service patterns...it's fun to think about what could work. The OP has already posited a SW hub at MDW...obviously, if that works then so would a UA/AA hub at ORD (again, from a purely geographical standpoint).

DL would be positioned fairly well with a Canada-MSP-Canada hub. I could also see AS picking up some British Columbia-SEA-YYZ traffic, with the minor hitch that they don't currently serve YYZ. But geographically, it would work.

On the flip side, YYZ would work fairly well as a connecting point from the western US to New England. If the price was right, I'm sure many folks in the Pacific Northwest would be willing to connect through YVR to head east. (Not to mention Alaska-YVR-lower 48 connections).

But not much else works, geographically, for US-Canada-US connections, especially given Americans' perception of Canada as the "great white North" (even though a significant chunk of the populated part is south of the 49th Parallel.)

Semi-off topic, but the best use of cabbatoge would be on cruise ships, not planes. If I could take an overnight cruise ship from San Francisco to Seattle, or Los Angeles to Honolulu with out stopping in Mexico or Canada that would be awesome.

Be careful about "never." ;)
http://en.wikipedia.org/wiki/Cabotag...enger_aviation

Australia and New Zealand have reciprocity and Chile has such with several countries as well. SQ can also fly domestic hops in the UK if it wants to.

Yes, but still, there are no domestic tags that have local traffic rights -- the only cabotage that goes on at the moment, AFAIK, involves LCCs that have bases outside their home country and are simply flying point-to-point domestically (e.g. Jetstar in New Zealand, Ryanair in Italy). Not saying that it's impossible, but it isn't done.

Canada's two largest cities re located south of Seattle. If Delta can make Detroit work, I am sure Air Canada could make Toronto work as a hub.

I know many people do the reverse, but I have not heard of people choosing Canada over the US unless it was for an international flight.

The thing I would be interested in seeing is Porter airlines. If they ever are able to fly the C-Series from YTZ, I could see them offering a strong connection network from the North East. Most other airports already have S preclearance, so US connections could easily be done without having to go through much. But then again I dont see either country in support of that idea.

IIRC at least one of the mid eastern carriers does Australia-NZ and vv. I guess it's a fifth freedom route but it still seems odd in light of the cabotage prohibitions.

TWA had a tag leg (IIRC sometimes flown with a much smaller plane but the same flight number) from CDG to MUC but wasn't allowed to serve local traffic, even for someone who flew TWA TATL to CDG and did a Paris stopover before continuing to Munich.

IIRC NW had intraAsian flights from NRT to a few other airports in Japan that were basically treated like international flights. I don't know whether local traffic was permitted.

What would the advantage be of a New York resident crossing into Canada to take a flight back into the USA? International might make sense but back into the USA doesn't. :confused:

As to the original question, Canada will never allow cabotage. Air Canada would be out of business in a year.

Someone in a different thread just last week mentioned going from Seattle up to YVR to catch a flight back to the US. If the price is right, why not? Crossing the US- Canada border twice in one trip is not a huge hassle for most people.

I wouldn't be so sure about that. Even if it was allowed the high airport fees would make make it unappealing for other carriers who are not used to the domestic airline business north of the border. There is a reason Southwest or Jetblue has never expanded into Canada to even fly trans-border, and it certainly doesn't have to do with gaining slots at Canadian airports.

That is probably correct for Montreal and Toronto but perhaps not for Hamilton or Kitchener. YKF would fall all over itself if a U.S. carrier could offer Canadian destinations. Until recently they were subsidizing AA to keep its one daily flight to Chicago.

If Canadians will drive to Buffalo for cheaper flights to the U.S. they will most certainly drive to Kitchener or Hamilton for cheaper flights to Canadian destinations and the big loser would be Air Canada.

I think it could work with Canada/USA with the requirement at least one intermediate stop be in the other country. I don't think many passengers are all that interested in flying BOS-YYZ-SFO, or YYC-MSP-YYZ (or so on and so forth), but if such combinations make available a few extra seats without adding capacity on either side of the border and improve the efficiency of the overall system, I can't see a problem with it.

As have pointed out or implied, its probably only of interest/use to budget, bargain basement fare travellers who have no problem adding 3-5 hours to their journey each way. But on the upside, it could help to support marginal transborder services to smaller centres on both sides of the border. Western Canada, for instance, has atrocious air connectivity to the northwestern USA.

I've flown SEA-YVR-SFO on flight passes, and yeah, it was far more painful than it needed to be and wouldn't have fathomed if I wasn't on an unlimited pass.

It has been tried and failed out of YHM before with WS.

I think you answered yourself when you stated that the city and airport subsidized the flight. If the demand was there the competition would be there and they wouldn't have to pay an airline to fly in.

As for going to Buffalo, really doesn't come into play in this case as the conversation is whether it would be cheaper if US airlines were allowed to fly within Canada. Pax traveling to Buffalo generally only do so to take domestic flights within the US. Southern Ontario, BC, and Quebec have been flying out of border airports for over a decade now and it doesn't dent AC's business at all.

Even if the big American airlines come in they would only the big routes such as YYZ-YVR, but they would have to rely mainly on point to point travel which has failed for a graveyard of airlines who have tried it before. AC's route network provides enough connections for them to not worry. You really think AA is going to start flying to YYB or YTS to connect to their, at best twice daily, YYZ-YVR?

I think you have let your dislike of AC overpower common sense in this argument. Canada just is too geographically large and the airport taxes make it a long shot anyone could come in and significantly hurt AC without doing the same to their operating line. If you want lower domestic airfares ask the Federal government to cut the airport taxes. The Ontario government in adding even more tax it is only going to get more expensive for everyone not just AC. Not exactly an environment any real LCC or anyone else could really come in and undercut without creating a financial bloodbath for everyone.

Tried this YYZ to FLA the Wed. before US Thxgiving due to close-in ticket price. One way car rental from Upstate NY, 2 customs hurdles, a SSSS due to one way ticket and a 2.5 hour flight in A/C rouge make this an experience Im not about to repeat. Even the MLL in YYZ did not make this trip worthy. :(:(:(

But maybe the flight wouldn't need subsidy (or as much subsidy) if they could capture some of the intra-Canada traffic with a US connection. From an origin such as YKF, in nearly all cases, the passenger is going to be forced into a connection. Does it really matter if that connection to an onward Canadian destination is in Chicago, versus, say Toronto?

Likewise, airlines in Canada can capture intra-USA business as well. Syracuse-San Francisco is always going to be a connection -- why not allow AC into the game with YYZ? Any time you remove these artificial restrictions, you increase utilization of aircraft and efficiency on both sides of the border.

I don't know if this would be considered pure 'cabotage', but simply amending the rules to allow US and Canadian airlines to sell connecting flights in both countries (but maintain the rule that no foreign airline may fly revenue pax between two points in the same country) would definitely work. And occasionally, would likely make for some amazing mileage run opportunities on both sides of the border for those so inclined.

Low airport fees in the US are largely the result of deferred maintenance on facilities. The "heavy lifting" in terms of modernizing the airport facilities in Canada has been largely performed in the past decade of high AIFs, and expansion projects are now few and far between. Meanwhile, a whole plethora of US airports, particularly ones which do not charge significant AIFs, are in quite dilapidated condition and will likely be forced to increase their rates quite dramatically in the future. I think FT'ers are well aware of some prime examples.

Having said that, the whole idea of allowing carriers to sell connecting flights between two points in the 'other' country is relevant for mostly low-fare situations -- ie: grabbing any revenue they possibly can over and above the non-avoidable cost of flying a seat. Or very high-end traffic, ie: selling seats into a market when everything is full with the domestic carriers.

For instance, in Canada, Thanksgiving is in early October. It is in late November in the US. The planes run absolutely full in Canada domestically on the morning after Canadian Thanksgiving, but the transborder flights are quite empty. If AC could sell the 50 seats on YVR-SFO-YYZ that otherwise probably would go empty that day, that's more usable capacity to the market without putting a single additional flight onto the network. UA, AA, etc., could do the same. Likewise, Canadian connections would become useful during US Thanksgiving, usually a fairly boring low-load November days in Canada.

The one that *potentially* comes to mind is YYZ-HNL (or maybe YUL-HNL, if that exists). A bit of a drive plus a higher airfare, but you get a widebody nonstop flight.

I doubt anyone living in Buffalo drives the 90-120 minutes to Toronto to go fly back to the US, and then has to drive back another 90-120 minutes upon arrival. For the purpose of what? Going through customs 4 times instead of 2 times and paying more for the flight?

It works the other way around. Torontonians go to Buffalo to fly to American cities since it's a lot less expensive given the lower taxes in Buffalo vs Toronto.

Once we're fantasizing, why not just have Canada dissolving and the provinces all applying for statehood? It's about equally like.

:D

What would stop a U.S. airline from buying up an operator in Canada, renaming it Delta Airlines Canada LLC dba Delta Airlines and then just offer flights like YYZ-MSP-YEG on that license.

That kind of airline would probably have to be majority owned by Canadians, not Delta. Passengers would also have to go through customs twice (4 times for a round trip). There might (?) be regulations preventing it if ticketed on the same ticket.....Maybe look up schedules to see if there are flights which could connect, like YYZ-ORD-YVR.

EDIT: Looked up DL schedules. They say no flight but, looking at the schedule, you can piece together such a flight.

Example: Winnepeg - MSP - Toronto
YWG arrives in MSP at 1025 am, next flight to YYZ is 1:42 pm.
YWG arrives in MSP at 613 pm, next flight to YYZ is 735 pm.

This would only work if there was no passport control between the two countries. In such a case there would be no difference flying from JFK to SFO via ORD or YYZ. In fact it would probably work fairly well for us passengers as it would increase competition and open new routing options.

I can't see it happening from a political point of view though. At least not in the close future.

EDIT: Anyone knows what would happen if AC and UA were allowed to compete on domestic routes in the US/Canada? I mean for Star Alliance.

Canadian costs are higher so I would suspect that an open US-Canada market would hurt Air Canada. Delta's hubs at MSP and DTW could siphon traffic from YYZ. If there were an open border, BUF would siphon more traffic from YYZ.

Very briefly, after Ansett failed, UA was allowed cabotage on SYD<->MEL. If you dig far enough back in the Trip reports forum, you can probably find some posts related to it.

Passengers were able to buy tickets for MEL<->SYD stand alone without connecting to a UA trans-pacific flight.

IIRC, the cabotage rights lasted only a month or two.

EDIT: Found some old threads about it:
http://www.flyertalk.com/forum/unite...ights-yet.html
http://www.flyertalk.com/forum/unite...-december.html

Well, for one thing, Canadian law. Foreign companies can not own more than a certain percent of a Canadian carrier (I forget what it is exactly now, maybe 25%). So it would never go through in the first place.

In fact, IIRC, when there was a fight for CP before AC bought it, one of the issues with the competing bid was it was going to have too much of an ownership stake by AMR, the parent of AA at the time.