Island Cut Off

Globe and Mail clipThe CBC is reporting that Air Canada will cut its direct flight from Charlottetown to Toronto this fall. They quote a Globe and Mail story that begins:

Air Canada is cancelling its Toronto-Charlottetown fall and winter flights because it’s livid about the PEI government’s subsidies for rival WestJet Airlines Ltd.

The change won’t exactly leave the Island cut off from the rest of Canada, but it certainly will have a negative impact on leisure and business travelers flying off-season because it will mean that all connections through Toronto will involve a flight to Montreal or Halifax first.


Nils's picture
Nils on July 18, 2005 - 18:15 Permalink

I’ve defended Air Canada in the past — mostly defending the people who work there under fairly trying conditions. And I still say they do a decent job with what their management gives them to work with in terms of policies and priorities.

But damn, this is such a spoiled brat, we-want-it-all-or-screw-you attitude by the airline that it makes my blood boil.

If two airlines were coming into a market fresh and at the same moment, then subsidizing (or, to be more accurate, offering guarantees to) one over the other is probably bordering on unfair business practices. But when one airline is established in a place, has a virtual monopoly and uses it to provide substandard and shrinking services at grossly inflated prices, then it’s not at all unfair for the government to step in and take steps to break the stranglehold.

Let ‘em go, says I. I really hope the provincial government does not fall into the trap of letting this outsized behemoth bully it into a matching subsidy.

Kevin O's picture
Kevin O on July 19, 2005 - 04:05 Permalink

Two points:

1) Notwithstanding the importance of air travel, what percentage of Islanders are actually affected by this? And of those affected, what percentage can easily afford alternatives?

2) Subsidies invariably lead to trouble.

Leo's picture
Leo on July 19, 2005 - 14:04 Permalink

In following the news reports on this issue — I am struck by three things:

1) Air Canada’s actions will punish Islanders and Island businesses and it is being done in direct reaction to the province’s funding of Westjet — there have even been discussions (negotiations?) between Air Canada and the Province as a result of this provincial decision — I think Air Canada is acting poorly and irresponsibly toward its customers on PEI like myself who would prefer to use an airline which does not cherry pick routes, serves a national purpose and who employ Islanders in a fair manner (although its recent treatment of its local baggage handlers call that into question). Westjet and some other carriers can charge lower prices simply because they pay their workers less or contract out some of the services they carry out — a race to the bottom.
The cuts to Air Canada staff and use of smaller planes have resulted sometimes in problems with lost luggage. The wonder is that it does not happen more often with the degree of lost positions that have taken place within Air Canada.

2) I think the provincial decision to subsidize Westjet should be seen in light of ALL the other ill fated provincial government business funding initiatives (almost too numerous to name but we just handed over additional millions to a Bank making hundres of millions of dollars recently not to mention other things like Polar Foods )- I simply think that the people making these decisions within the Province are very short sighted and are making decisions without regard to the consequences of their actions — I think if Westjet made the decision to fly here on its own, I commend them but do not understand why a profitable airline needs to be subsidized by Islanders who are facing cutbacks in vital public services — I would rather have the money fund an ambulance service which we can count on (obviously it is underfunded and not meeting needs) or keep Souris Hospital emergency services open 24/7.

3) I think that the state of the airline industry today are the result of the deregulation and privatization which may not serve countries like Canada where there are vast areas to be served across the country and some airlines are expected to serve everyone where others cherry pick routes. Also, smaller airports like Charlottetown are forced to compete against other regional airports due to the privatization and downloading of our public transportation and other infrastructure. Will we see ads touting the advantages of the Port of Charlottetown versus the Port of Summerside in a few years? Should not the ad money be used to reinvest in services which should be public and were public in the first place?