jazzsax

https://www.msn.com/en-ca/travel/new...ep_csid=103001

LOL, funny coming from a company who won't even pay for delays that are their own fault *cough*cough*crew planning*cough*cough*

Can't even get a proper premium meal on a flight...

tcook052

WS continues to confound me as this transportation model has been in place for ages and only now they have a problem with it?

WS looks laughable for tilting at such imagined windmills while it's own plethora of problems remain unsolved so maybe von Hoensbroech should focus more on a new CBA with its unions than external irritants.

Adam Smith

Where there's a contractual relationship with an external party, e.g. catering, WS should already be free to negotiate penalties in those contacts if the 3rd party causes a delay that defray some portion of their cost to compensate passengers. Getting the government to compensate for anything service-related is a joke, that's not how governments work.

Airports are a bit of an interesting case given their status (most large Canadian airports are non-profit corporations but with ultimate power still resting with the federal government), but since they're mostly stand-alone, I wouldn't be opposed to the airlines negotiating a commercial arrangement.

But ultimately it's WestJet's responsibility to factor APPR and other regimes (EU261 etc) in to its business model. Decrease the number of flights, increase MCTs, increase fares, etc, there are lots of ways to adjust the business to reduce the number of payouts while maintaining adequate profitability.

Denguin

I mean, why not? They are already getting passengers to share compensation costs for flight delays... by wrongfully denying compensation left, right, and centre.

Fisch

It's not ONLY WS that plays fast and loose with APPR payouts. It's "industry standard" it seems. I disagree that WS is wrong for barking up this tree. The GOVT is hypocritical for the current APPR. Nav Can, Airports, CATSA, etc have massive impacts on the operational performance of the airlines.

Let's take a step back, and think critically about how the operating environment of Canada's civil aviation sector functions. It is not WS, AC or F8 etc. screwing consumers on purpose. Air carriers want to operate on time always. It's in their own interest.

tcook052

It's not that WS is barking up completely the wrong tree but rather the optics of their barking up this tree at this time aren't good as they've been guilty too often lately of scheduling far more flights than they can reasonably operate so need to focus on more important internal matters - including pressing labour issues - before becoming preoccupied with external concerns real or imagined.

As I said, the reality of delays caused by third parties such as airport authorities existed prior to the pandemic so not sure why WS is raising this now other than to pass the blame for some of it's own failures.

And I want to be younger but as Mick said you can't always get what you want; the airlines knew APPR was coming for years pre-pandemic and as Adam Smith says had ample time to gear up and adjust for it so don't buy that the notion they are a wholly innocent party as in many cases WS has simply ignored paying compensation where due or fought tooth & nail from having to provide it at all as in the case of cancelled flights for factors within its control such as staffing shortages.

There is a degree of ineptitude in how civil aviation is governed in Canada I'll grant you as rather than address the root of the problem, airlines ignore APPR, Ottawa chose instead to spend millions to hire more staff to clear a massive CTA complaint backlog but again think WS has more pressing battles to fight rather than engaging in new ones like this. As the saying goes, pick your battles.

Speedbird84

My guess is he wouldn't be doing this if he was still working in Europe, taking into account how airtight the EC regulations are.

Everyone knows how much the CTA sways its regulations in the favour of business over consumer to lessen the burden on the airlines. He's probably doing this out of concern for a) whatever future changes are being considered for APPR and b) to elicit some modicum of sympathy from the public for WS (as if that'll happen).. that it's not all the fault of the airline, etc.

What I don't get though is the general consensus seems to be that for a service like ground handling, WS is picking the lowest bidder for contracts. They're probably the lowest bidder because they pay employees the least. If these ground handlers start getting hit with penalties because they arent staffed as they should be, what's going to happen to those cheap contracts? They start increasing rates, so the airline is going to pay up one place or another.

boomerfss

I've seen a lot of delays for ATC staffing shortages. Every summer there's NOTAM's out for "reduced system capacity due to staffing shortages". Kinda outside the airlines control. NAV CANADA is a private company.

TravellingChris

There are a number of problems with this proposal. First, there are all sorts of reasons why flights may be delayed. Connecting passengers may be held up because of delays at customs, for example. I was on a domestic flight awhile back that was held because we were waiting for inbound passengers from Fort Lauderdale to get through customs and arrive at our gate. So would the CBSA also be expected to compensate the airlines for delays at border screening points?

Second, as others have noted, the current "passenger protection" regulations are already truly, madly, deeply in favour of the airlines. Not only are airlines denying most compensation requests that are made, but there are plenty of situations where the passenger ends up out of pocket and the scenario doesn't qualify for compensation under the APPR in the first place. The "safety" loophole is idiotic because it allows the carrier to describe virtually any delay as due to safety.

Third, WestJet claims that if the burden of (potential) compensation isn't spread around, it will be forced to significantly increase fares. So how is it that in Europe, where passenger protection regulations are MUCH more stringent, airfares are more affordable and competitively-priced than in Canada? Airlines there are forced to operate under an even tougher regime, yet prices are comparatively better.

Frequentlander

First of all, full marks for "truly, madly deeply".

What WS (and I suppose AC) are conveniently omitting from their argument is that they have a commercial agreement with the passenger and the other entities don't. If there is a delay, for whatever reason and WS is hypothetically required to pay compensation to passengers, WS are totally free to go after the entities that they believe to have caused them to be delayed in which ever forum they think best (courts etc). This is the way insurance works.
When "something" happens. Insurance pays out to the insured (in our instance compensation to the delayed/disrupted passenger), and the insurer then goes after whomever caused the incident on "recovery". Yes, it's messy, and if a similar system were working in the airline/transportation business, this messiness would a huge incentive to perform better.

The problem we have is regulatory capture where the airlines have successfully lobbied to slant the rules - such as they are - "truly madly deeply" in their favour to the extent that the system only works to create an atmosphere of mistrust and annoy passengers even more. There is little chance of problem resolution/compensation because the airlines know they are in control of the process.

aerobod

The amount of revenue an airline gets for a comparable flight distance for a similar product (i.e., same seat pitch, similar aircraft, same cabin class and similar stage length) is less in Canada than in Europe when doing a like-for-like comparison, the big difference is the taxes and fees added in in Canada are overall higher, giving the illusion that the airlines make more money in Canada than Europe for comparable tickets.

For 2022 (from published financial reports), here are some comparisons based on PRASK/RASK/PRASM/RASM (passenger revenue per available seat for a given distance), load factors and stage lengths are comparable on these 3 airlines:

Air Canada - $0.182 (PRASM in CAD)
Air France / KLM - $0.220 (RASM equivalent in CAD, RASK €0.093)
British Airways - $0.204 (PRASM equivalent in CAD, PRASK Ł0.076)
Lufthansa - $0.213 (RASM equivalent in CAD, RASK €0.090)

Air Canada looks to have revenue for comparable tickets 12% lower than British Airways, 17% lower than Lufthansa and 21% lower than Air France / KLM.

In 2019 before COVID, the last reported values for WestJet before it was taken private by Onex can be analysed relative to similar sized LCC orientated European airlines (ULCCs are comparables with Swoop and Flair, not WS), based on Q2 2019 financial reports:

WestJet - $0.149 (RASM in CAD)
Aer Lingus - $0.162 (RASM equivalent in CAD, RASK €0.068)
Austrian Airlines - $0.171 (RASM equivalent in CAD, RASK €0.072)
Finnair - $0.152 (RASM equivalent in CAD, RASK €0.064)

WestJet looked in 2019 to have revenue for comparable tickets 9% lower than Aer Lingus, 15% lower than Austrian and 2% lower than Finnair.

With lower route density and higher winter operating costs due to weather delays and the high cost of deicing an aircraft, one would expect the Canadian airlines would need higher revenue to cover higher operating costs. I expect that APPR payments equivalent to EU passenger rights payments would add at least 10% to current costs and other industry pressures relating to pay, inflation and infrastructure inefficiencies are likely going to push this to more like 25% higher ticket costs over the next 2 years for the airlines to make a small profit.

TravellingChris

Yes, but remember the other side of the coin is that domestic airlines in Canada enjoy a protected market position. There is no cabotage in Canada. Aside from WestJet, which is nevertheless well back of Air Canada in terms of both size and passengers carried, local competitors are all minnows. By contrast in the EU there are several large airline groups (IAG, Air France-KLM, Ryanair, Lufthansa Group) which can operate anywhere in the EU. There is no single airline or group that has a comparable dominant position in the EU-wide market that AC, for example, has in Canada. Yes, the Canadian market is much smaller but the local fish are in a protected pond.

Remember also that airlines such as AC and WS will act aggressively (and arguably anti-competitively) to safeguard their privileged position. Most recently they took legal action against tiny Flair Airlines, alleging that it didn't meet Canadian ownership requirements--despite the fact that Flair is a fraction of the size of either carrier. AC and WS were also accused of anti-competitive tactics (including predatory pricing) that allegedly played a role in the demise of other competitors like JetsGo and Greyhound Air.

aerobod

Yet despite the lack of full cabotage (there is some effect from through traffic from the US, with WS stating in 2019 that up to 25% of Europe bound passengers originated in the US, with AC also having significant US through passengers, too. US Airlines also take near border and foreign / Canada passengers, too), the revenue per ticket airlines get in Canada is lower than in Europe when proper comparisons are done. Basically no matter what the state of market protection in Canada (no different than the US or the EU as a whole from a protection perspective), prices are economically too low for reasonable profitability at the moment. Flair's recent bill paying troubles and the financial losses Sunwing and Air Transat have in their aircraft operations also hammer home the current pricing issues, which stronger APPR rules will only add to.

Passengers wanting better APPR protection need to be willing to pay for it. If they don't want to pay more, then lobby the Government to provide a lot of the infrastructure services such as Nav and their airport rent costs out of general revenues instead of adding to ticket costs, as is done in most countries.

p106_peppy

Nav Canada also laid off a bunch of people during covid and has opted not to rehire, intentionally lean-staffing.

boomerfss

Actually they didn't lay off any operational people. They paused hiring though and that has been very problematic.