:
I call this meeting to order.
Welcome to meeting number 112 of the House of Commons Standing Committee on Transport, Infrastructure and Communities.
Pursuant to Standing Order 108(2) and the motion adopted by the committee on Tuesday, April 16, 2024, the committee is resuming its study on the state of airline competition in Canada.
Before I begin, I would like to remind all members and all meeting participants in the room of the following important preventative measures.
To prevent disruptive and potentially harmful audio feedback incidents that can cause injuries, all in-person participants are reminded to keep their earpieces away from the microphones at all times. As indicated in the communiqué from the Speaker to all members on Monday, April 29, the following measures have been taken to help prevent audio feedback incidents.
All earpieces have been replaced by a model that greatly reduces the probability of audio feedback. The new earpieces are black in colour, whereas the former earpieces were grey. Please use only the black, approved earpiece. By default, all unused earpieces will be unplugged at the start of the meeting. When you are not using your earpiece, please place it face down on the middle of the sticker for this purpose, which you will find on the table as indicated.
Please consult the cards on the table for guidelines to prevent audio feedback incidents. The room layout has been adjusted to increase the distance between microphones and to reduce the chance of feedback from an ambient earpiece. These measures are in place so that we can conduct our business without interruption and protect the health and safety of all participants, including our interpreters.
Thank you for your co-operation.
Once again, today's meeting is taking place in a hybrid format in accordance with the committee's routine motion concerning connection tests for witnesses. I'm also informing the committee that all witnesses have completed the required connection tests in advance of this meeting.
I would now like to welcome our witnesses.
Appearing before us for the first hour, we have, from Air Canada, David Rheault, vice-president, government and community relations. Bienvenue. We have, from Air Transat, Mr. Howard Liebman, vice-president, government relations. Welcome to you, sir. From WestJet Airlines, we have Andrew Gibbons, vice-president, external affairs. Welcome once again.
We'll begin with opening remarks. You will each have five minutes.
With that, I will start with you, Mr. Rheault.
[Translation]
You have the floor for five minutes.
[English]
Good morning.
I am pleased to appear before you today.
[Translation]
Air Canada is proud of the services it offers Canadians. We serve more than 180 airports around the world, including 50 airports in Canada. In 2023, we offered nearly 55 million seats and welcomed more than 46 million passengers, whom I thank for having chosen us.
In the domestic market, we offered Canadians nearly 25 million seats. We are the only carrier to serve all the provinces every day of the year.
[English]
At the outset, I would like underline that the Canadian air travel market is highly competitive. Close to 70 international carriers operate to Canada and compete with Canadian airlines. Some of these carriers are two to three times larger than Air Canada, including Delta Air Lines, Air France KLM, British Airways, American Airlines, Turkish Airlines and others.
In fact, Canada has three of the world's 50 most globally connected hubs. This is a significant achievement. No other country, apart from the U.S. and China, has three hubs in this ranking. This highlights that the air travel market in Canada is dynamic and competitive and that Air Canada can compete and succeed at the global level. The level of connectivity offered by Air Canada facilitates trade, tourism and immigration. It allows us to employ 40,000 people and support more than 190,000 indirect jobs.
There has also been a significant increase in competition in the domestic market, with other carriers increasing capacity, including WestJet, Porter and Flair. While in 2001 Air Canada's capacity share of the domestic market was around 75%, it's currently around 43%.
There are 24 airlines serving the Canadian domestic market, including 20 offering more than 50,000 seats per year. Three carriers have more than 10% of the capacity for a total of 82% of the capacity. Let me share with you some facts to put this into a global perspective.
In Australia, Qantas has 58% of the capacity, and more than 90% of the total capacity belongs to two carriers. In total there are 13 carriers.
In France, Air France has 54% of the domestic capacity, and four carriers have more than 10%, for a total of 95%. There are 10 carriers.
Finally, in the U.S., by far the largest market, 20 times bigger than Canada, probably the most competitive market in the world, four carriers have at least 10% of the capacity for a total of 80%. Only 28 carriers offer more than 50,000 seats per year, compared to 20 in Canada.
[Translation]
However, we face unique challenges in Canada that limit the airlines' ability to stimulate the market, offer more attractive fares and develop our Canadian airports. First of all, our geography is a special challenge. Canada has relatively few major cities, distances are long and the climate difficult. We also have a model in Canada under which travellers bear all costs and certain revenues are not reinvested. Travel could be made more affordable if that model were reviewed.
[English]
For example, airports pay rent to the government, and that totalled around $400 million last year. They also make payments in lieu of taxes to municipalities.
In addition, Canadian travellers are subject to high fees and charges. This includes security fees that have risen by 30% in the 2023 budget, now exceeding $34 for an international flight. In the U.S. the equivalent fee is at $5.60 U.S.
As well, airports charge airport improvement fees to fund infrastructure that can reach $46 per flight in Canada compared to $5.50 in the U.S., where the government reinvests excise taxes into the system and has announced $40 billion U.S. to support airport infrastructure.
Finally, air navigation fees are also higher in Canada.
[Translation]
The impact of the Canadian model has been well documented and extensively studied.
The same findings were made by the Senate Standing Committee on Transport and Communications in 2012, in the Canada Transportation Act Review, the Emerson Report, released in 2015, and, more recently, by the Montreal Economic Institute.
Here's an excerpt from the Emerson Report:
[English]
“Canada is unique among its competitors in charging onerous rents and taxes that undermine competitiveness.”
This committee issued a report last year, recommending a review of all costs imposed on airports and airlines and the reinvesting of all rents collected in airport infrastructure. We welcome that conclusion.
[Translation]
In conclusion, we are here today to state once again how important it is to adopt policies that acknowledge the role of our industry, which, as the Senate put it in 2012, is to be “a spark plug” not “a toll booth”.
Thank you.
Thanks as well to the members of the committee for the invitation to appear today on behalf of my 5,000 Air Transat colleagues.
Established in Montreal in 1987, Air Transat it is an affordable, people-centred, international holiday airline.
[English]
Air Transat connects Canadians to some 54 international destinations in more than 25 countries in the Americas and Europe—and soon, Africa—from eight Canadian cities. Air Transat carries five million passengers every year, including half a million visitors to Canada.
Air Transat is uniquely positioned as an affordable, reliable, international air travel option for Canadians. Our 37 years in the European and sun markets has enhanced competition and lowered prices for Canadians. Air Transat is eager to work with government and with Parliament to protect competition in Canada.
Air Canada is a dominant player, offering 39% of Canada's international airline seats. To southern sun destinations, WestJet and Sunwing together held 50% of our national market when they emerged, with a share of over 70% of western Canada seats to the sun. From Montreal to Europe, Air Canada has grown its seat offering by well over 60% since 2019.
Both Montreal and Toronto airports will undergo much-needed infrastructure upgrades and construction over the coming years. Airport infrastructure, slots and gates, especially at peak times and in peak season, will be in very high demand.
As the aviation experts noted to this committee on Tuesday, we will need to work closely with airports, partners and government to ensure that access to infrastructure during the coming years of construction and beyond at our key hub airports does not impair competition as dominant industry players continue to grow significantly.
The COVID-19 pandemic and the accompanying travel restrictions forced Air Transat, as a purely international carrier, to entirely suspend its operations in 2020 and 2021. Each time, we were making sure to repatriate tens of thousands of our customers safely back home from around the world at a cost of tens of millions of dollars. Eighty-five per cent of my fellow employees were laid off, and our revenues disappeared completely.
In our 33-year prepandemic history, Air Transat never sought financial support from government. We have rebounded from the pandemic and returned to our full prepandemic employment level of 5,000 workers, to revenues of $3 billion and to a fleet of just under 40 large commercial jets.
Our previously debt-free company, which had almost $700 million of liquidity in its coffers in 2018, was able to endure thanks to some $800 million of emergency pandemic loans from the federal government under programs unanimously authorized by Parliament. Of the $800 million loans, $350 million flowed directly to passengers in the form of refunds in 2021.
Your intervention worked. These loans saved Air Transat and 5,000 jobs from the ravages of the pandemic to continue as a strong and reliable competitor in the market, and we are here to thank you for it. This was no small feat. As was noted in committee on Tuesday, Lynx is no longer in business, and Sunwing has since been acquired by WestJet.
Without the pandemic and our large resulting indebtedness, Air Transat would have been in a much more favourable financial position to grow and further enhance competition in Canada.
Three years later, market conditions have evolved significantly in our industry. We recommend that the government undertake a review of the pandemic supports that were offered, how these arrangements are now operating and whether adjustments could be made that would continue to enhance competition in the marketplace.
It may sound odd for an airline to say this, but we welcome fewer restrictions on ownership. We need more capital to be able to compete. While we would not change ultimate ownership restriction at 49% for non-Canadians, we believe it is futile to leave the limit on a single foreign shareholder at 25%, particularly in the age of large global airline alliances.
In closing, while some airlines are exiting some markets, we are offering Canadians more choice. Air Transat has entered into a new commercial joint venture with Porter Airlines whereby the two airlines will code-share and offer convenient, seamless, affordable domestic and international travel options for Canadians.
We will connect Porter's growing domestic and North American network with Air Transat's expanding international network. This commercial agreement is a major win for travellers and for airline competition in Canada, with expanded service to more and more cities.
[Translation]
Thank you once again for your invitation to appear today.
I will be pleased to continue the discussion with committee members.
:
Thank you, Mr. Chair and members of the committee.
[English]
Thank you very much for having me here today.
My name is Andy Gibbon. I am the vice-president of external affairs for the WestJet group.
[Translation]
We are pleased to be here to express our views on the state of airline competition in Canada.
WestJet has been enhancing competition and offering Canadians a range of affordable air travel options for 28 years.
[English]
No company or individual has our vantage point for this discussion. WestJet is the company that made it. We took on the nation’s largest carrier when many said it could not be done.
Canada is best served by a strong and profitable WestJet, but we can do this only thanks to our guests. They have a choice, and they choose us. We are grateful.
The democratization of Canadian air travel is a WestJet achievement. In our years of serving Canadians, WestJet has cut airfares in half and increased the percentage of Canadians flying by more than 50%.
Launched in 1996 with two aircraft, 200 employees, five destinations and a dream, WestJet has grown to more than 180 aircraft and 14,000 employees, flying to more than 100 destinations in 23 countries.
With great effort, we built an airline to serve Canada. Our plan is to continue to grow better, to connect Canadians with where they want to go and to support the recovery of the tourism industry across the nation. We are adding more routes, more services and more choices under our ambitious growth strategy, which is just shy of two years old.
While there are no barriers to entry into the Canadian marketplace, it isn’t easy to grow and succeed as a new airline in Canada.
First, Canada’s geography and market are challenges. To take one example, in Europe there are 100 air travel markets with a population of over 500,000, while in Canada there are 10.
[Translation]
Even though its area is similar to ours, Europe, with a population 20 times greater than that of Canada, has a market that can more readily support very low-cost carriers and market newcomers.
[English]
Second, we heard experts say on Tuesday that Canada has a high and uncompetitive tax and regulatory environment, with high mandatory third party fees. The most recent budget states, “It is only fair that Canadians have full transparency about the full cost of their flight.” We agree. This must include the mandatory third party fees that truly drive up ticket prices.
Successful American carriers have found a way to serve Canadians through U.S. border communities. They do this because there are fewer fees. To them, Canada is a low-margin, high-tax and regulatory burdensome market. To this end, we recommend reviewing all taxes, fees and service charges to provide greater transparency for Canadians and a market environment to enable all carriers to thrive. This must be part of an overall review on whether the user-pay model is working for a modern Canada.
I’d like to briefly update from my last appearance at this committee to address the challenges we all face in the postpandemic start-up. We at WestJet are thriving once again. We have hired thousands of new staff. We are beyond 100% capacity and back to where we were before 2020. We have further expanded with new strategic routes while maximizing choice for Canadian consumers.
Our ambitious growth plan, which has been welcomed by Canadian communities in all regions, has three pillars. The first is to continue to be Canada’s coast to coast leisure champion. The second is to provide western leadership and bring strategic investments to historically underserved markets in the west. The third is to return to our low-cost routes.
This is what made WestJet successful and what Canadians fell in love with. We know that; we've heard that, and we are returning to what made us successful.
[Translation]
We are proud to be part of an industry that, despite across-the-board cost increases, has managed to maintain stable and constant prices.
[English]
Canada has a competitive air travel market, but we can work together to make it better in partnership with government.
We put forward the following recommendations for committee members:
First, review the user-pay model for a modern Canada. All government and third party fees should be reviewed for competitiveness impacts, intermodal equity and value for taxpayers' money.
Second, officially suspend all APPR policy developments. There is agreement across all communities, chambers, airports, airlines big and small, and provincial governments that these proposals do not help lower prices or increase competition. We do not believe changes should be contemplated until the current system works for Canadians. Currently, there is inconsistent application of these policies, and there are huge backlogs at the Canadian Transportation Agency that need to be addressed.
Thank you again for having me here today. I welcome your questions and look forward to this discussion.
I appreciate that we're trying to get forward and, of course, we're behind schedule, but I just think we wanted to make Air Canada feel comfortable, being behind schedule in getting this meeting going.
I'm going to start with competition, what we're looking at here in Canada, what Canadians are feeling and what they're trying to get us to do here in committee and as parliamentarians.
We really don't have a lot of competition across all markets in Canada, across all provinces and certainly between all destinations. What we've seen with that is that there are three different problems.
One, there's not a lot of competition in high-frequency routes. There is in some of them, but not all. Two, we have routes to less-travelled regions in Canada that really don't have a lot of competition and sometimes have only one or, if they're lucky, two carriers going into them. The third complaint we hear from Canadians is that it's really expensive to fly from Canada to international destinations compared to the experience of some Canadians who go across the border and find cheaper flights.
My question is for Mr. Rheault from Air Canada. Air Canada was just ranked dead last in on-time performance among North American airlines. In January 2023, 63% of flights did not arrive within 15 minutes of their scheduled time—63% of your flights.
Do you believe we need more competition to have Air Canada improve that ranking?
:
Thank you. I'm so sorry, Mr. Rheault; I have only so much time.
We're going to look at two major routes between two major city centres.
We'll look two weeks in the future between two routes. We'll look at Toronto to Ottawa, and then we'll look at Toronto to Vancouver. For Toronto to Vancouver, there's more competition, it seems. There seem to be four airlines: Flair, Porter, WestJet and Air Canada that are competing, and you can get a round-trip price with Air Canada for $385, which seems pretty low, but if you look at Toronto to Ottawa, it seems that you have only Porter, WestJet and Air Canada, and that price goes to $585.
For a destination, Toronto to Vancouver, that is nine times further than Toronto to Ottawa, it seems that the price goes way up with not having that competition.
How do you explain that you have a price that's so much higher for a local Toronto to Ottawa destination than for a Toronto to Vancouver destination?
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What's of value here, Mr. Williams, is what the American carriers have to say about why they avoid Canada.
Their testimony, whether it's the president of Southwest or JetBlue or what have you.... These are some of the most successful low-cost carriers in the world. Their public comments about why they avoid the Canadian market and how they serve from American airports is the most critical testimony you could find.
The reason, as I said in my original comments, is that I don't think we have a tax and regulatory environment for a modern Canada. There was a time when air travel was not the essential connective tissue of Canada, as it is today.
I have nothing against rail, but we see that in issues like the rail subsidy. Passengers from Moncton to Montreal are very heavily subsidized on a train. Is that essential for Canada today? We are now the essential mode for Canada.
It's not about us versus them; it's about a regulatory environment that believes that all modes should be treated equally and that we should prioritize a different psychology and culture around aviation.
:
We don't sit around and calculate benefit when an airline fails.
As I said in my remarks, we are the company that succeeded. So many others have not. It's not a day of joy around our office when an airline fails. Actually, competition makes us stronger.
I'd submit to this committee that we've made Air Canada stronger. Air Transat has made us stronger. New carriers make us stronger.
It's not a day of celebration for us. What I can tell you is what we're doing to serve that market. What we're doing to serve that market is reconfiguring all of our aircraft so that there is an ultra-low-cost part of the cabin on every WestJet airplane.
Our determination is not different from Lynx's in that we ran Swoop; we owned Swoop and we operated Swoop. Our determination as a company was that this market segment can best be served within WestJet. Instead of having to stimulate 180 seats, you may have to stimulate only 40 or 60.
We believe that is the path forward for Canadian travellers. We think that is what they want. We'll come back in a year to find out how it's going.
We serve that market too, but it is not a day of celebration for us when an airline fails.
:
Thank you very much, Mr. Chair.
Thanks to our witnesses for being here. The topic we're discussing today, the state of airline competition in Canada, is very important.
I'll go first to the Air Transat representative for a simple reason. We are actually conducting this study as a result of Lynx Air's bankruptcy. In recent years, WestJet has acquired Sunwing. There's also Swoop, which belongs to WestJet, and Flare Airlines, which is now in trouble. Porter is in business, but it doesn't necessarily offer international flights.
In one sense, Air Transat is the lone bulwark against a potential Air Canada-WestJet duopoly.
Not so long ago, many people were skeptical about Air Transat's future, assuming that the business would go bankrupt. However, it made it through the pandemic and now seems to have a sound growth plan.
How did your company manage to navigate the crisis when others failed?
:
Thank you for your question.
I have to say it wasn't easy. The pandemic was our biggest challenge. As I admitted in my opening remarks, we're now deeply in debt. If the pandemic hadn't occurred and we hadn't taken on all that debt, Air Transat would have been able to bring even more growth to the market. However, we want to work with Parliament to find a way to continue growing.
I also mentioned our alliance with Porter, with which we've entered into a commercial agreement to offer more options and choices to all Canadians and Quebeckers. We're also going to add new destinations, such as Marrakesh, Morocco, and Lima, Peru. We've also maintained the sole link between Montreal, Canada and Port-au-Prince, Haiti.
I have to admit that people around me often say they choose Air Transat because they're certain, or feel guaranteed, that they'll get good service in French, which I think is very important.
Some witnesses told us at a previous meeting that one of the factors that might help improve competition is good time slot and gate access. However, they also said that shouldn't come at the expense of an established business. When I asked Air Canada, which holds a major market position, if it should limit its growth, I was told no.
How do you limit Air Canada's growth while allowing smaller players to grow? I assume there'll be construction at the major airports and that slots will be limited.
Is there a way to do both?
:
Thank you, Mr. Chair, and thank you to our witnesses for being with us today and answering our questions.
Mr. Rheault, you described Canada's airline sector as “dynamic and competitive”. It seems like a message that is in stark contrast to the one that we heard at our last meeting, when we heard from researchers and academics who work in this space and look at the structure of the air travel sector.
One of the questions that came up was one I thought was really good. Our chair, right at the end of the meeting, essentially asked this: If we were to take up this recommendation to reduce fees and charges and make it cheaper to operate an airline in Canada, what would prevent airlines from simply increasing their prices, charging the same amount to passengers and taking that as profit? The answer we got back was nothing, essentially. “Welcome to capitalism” was basically the answer we got.
The question for you would be this: What would ensure that those savings would be passed on to customers?
I would argue that we don't have a very competitive airline industry. Certainly, the communities I represent don't see that competition translating into lower prices.
Right now, both Air Canada and WestJet are posting profits. I think Moody's projects that those profits are going to be even greater in 2024. It seems like you're doing fine under the current regulatory, tax and fee structure.
Why do those need to be lower?
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I would say, first, as I mentioned in my remarks, that the market in Canada is very competitive if you compare it to other jurisdictions.
[Translation]
With your permission, I'll continue in French.
In 2012, the Senate considered the same question that the chair asked last time, and prepared a report on it. It considered what would happen if taxes and fees declined. One element of consensus among the witnesses and one of the report's recommendations was that, if the cost base were lowered for operators, that would help large and small airlines further stimulate the market. Stimulating the market will generate more volume and enable more carriers to offer more capacity at more affordable prices.
You and the chair asked the same question: If fees go down, by what mechanism will the savings be reflected in ticket prices? The answer is that it will do so through competition because, if a carrier wants to make a profit, competition will enter the market.
:
Thank you very much, Mr. Strahl.
The figure we've used is about that, publicly. We say that, for a domestic return flight, it's about $160 before the WestJet group's base fare is applied. We think that's high. Lynx thought that was high.
Most importantly for this discussion, it stifles competition. You can stimulate the market only so much when you're starting at $161. I think that's the issue.
That's the issue you see in your community, with your constituents going to Washington state. They don't have better planes, crews, staff or service. They're there because of that barrier, which has nothing to do with our company.
:
I think that's the record, honestly.
The government does overcollect for services it provides to the Canadian traveller. I think it's about the traveller and the consumer.
One quick example is CATSA. I have nothing against CATSA's leadership—they're doing their best job for the people of Canada—but that fee was raised by 29.5%, and we have questions as to whether that money.... That is a fee paid by our guests. We believe that that money should be held in public trust and should be directly tied to the services rendered by the organization. It's not that straight a line, and it's quite confusing at times to understand where the fee goes versus what the allocation of the budget is to the organization.
The new concern that we have, Mr. Strahl, is that the fees travellers are paying for their security are sometimes going to general revenues, and there's an overpay.
It's a small example of where a fee goes, and we think that if consumers and our guests are paying the fee, there should be a greater level of transparency around it.
Thanks to the witnesses for being here.
Mr. Rheault, at the last meeting, which you no doubt watched, one of the things we discussed was regional air transportation, in which Air Canada plays a certain role. Today, as at the last meeting, virtually everyone has discussed user taxes and fees, which restrict consumer use of those services by increasing prices.
As I previously pointed out, if we subsidized air travel for people travelling south to enjoy the sun, that might be less acceptable to ordinary people than partially subsidizing air travel in certain remote regions where it's essential.
I'd like to know what Air Canada thinks about that. It might even help you play a larger role in regional air travel.
:
Thank you very much, Mr. Chair.
Mr. Gibbons, I want to continue our conversation. We have seen Nav Canada fees, since the pandemic, go up 29%. You mentioned that CATSA fees in the last budget were raised 29%. We have seen that the airport rents paid to the government have increased by 42.5% in the last decade.
As the government keeps layering on fees, which they impose on customers who are trying to fly, driving up the costs for Canadian travellers, it appears to me that the government really has no interest in increasing air travel across the country. Through increasing taxes and fees, it may in fact want to decrease air travel in the country.
Do you have any opinion on that? Have you seen any indication from the government that its goal is actually to increase air travel in this country, or does it want to decrease it?
:
In communities across the country, the response to what we're doing is very positive, Mr. Strahl.
This is what the experts have said. Canada has a high tax and regulatory burden, and reorienting and modernizing those policies is going to help competition.
The motion before the committee is in light of Lynx Air's failure. Lynx cited the reasons, in their opinion, for their failure. I think this was a very well capitalized airline. They had ownership from one of the most savvy airline owner-operators in the world, and they failed.
There are challenges. You went through CATSA, Nav Canada, rents and AIFs, and I think the common denominator with all of them is that there is a lot of debt to dig out of from the pandemic. That debt, whether it's airlines or whether it's those organizations, is all being felt by the traveller. We're in an affordability crisis.
Again, back to the APPR, every community, every small airline, every small region and everyone across the country has said that this is not the time to increase the cost of travel. We can protect Canadian travellers, but we also should not be increasing costs at this time.
:
Thank you, Mr. Gibbons.
I'm sorry to interrupt you. The was invited, and we have no indication that he has accepted that invitation to talk about this with us.
I want to discuss, as well, something you talked about in your remarks about intermodal equity in terms of how the government supports different modes of transport in the country. We just had a lengthy study on high-frequency rail in Canada.
Do you believe that we need to address issues of lack of competition or the competitive environment in the aerospace sector in air travel in this country before we look at massively investing in a mode of transport that won't be available? I know you're focused on the west. I can tell you that none of my constituents would ever use HFR. They'd have to fly 3,000 kilometres on one of your jets to get onto the start of that.
Do you believe we need to look at the competitiveness and investments in the air sector before we can have a fulsome look at things like high-speed rail or bus service, as has been mentioned before? Do you believe the government has done that work to look at how we can improve connectivity via the airspace before investing $10 billion, $20 billion or $30 billion in a new HFR?
This has been a very enlightening conversation. I'm not going to start speaking about the politics of what we're trying to discuss today or, of course, some of the answers that some of the people around us are trying to get out of you to further that agenda. I am going to concentrate my questions on the business at hand, and that is to deal with the state of airline competition here in Canada and ultimately the ability that we have as partners to make it better for the consumer, whether it be through cost or through connectivity.
I'm really going to concentrate on this session with you, Mr. Liebman, with respect to Air Transat, and the following session with Mr. Jones from Flair, specifically on the “how” to the “what”. I just basically underline and bold what the “what” is. Now it's the “how”.
I'm going to give you the floor, because you will not actually be answering to me but to this young lady over here with testimony that is going to be contained within the final report to be presented to this committee, which will go to the department for a response and then, hopefully, from there to a strategy to actually get it done.
With that, I have a very simple question: How did you do it? Specifically, how do we learn from you with respect to encouraging further competition? How did you stay afloat? What investments did you make on the operating and capital sides? How can we learn from you to ensure that from that level or foundation we can move forward with a strategy we can embark upon?
:
I want to reiterate that Air Transat and the 5,000 employees of Air Transat are here to work with Parliament and with government to protect and enhance competition in Canada.
For 37 years, Air Transat has been taking Canadians on their, mostly, leisure trips, on their international trips, and sometimes on their trips back home. We've also been bringing hundreds of thousands of visitors to this country, primarily from Europe, every year as well. We've grown from one plane to, today, almost 40, with 5,000 employees.
We have kept in our lane. We've focused on the business. It's a testament to the professionalism of my colleagues. We had a very major challenge, a very major upset in the pandemic. When the borders are closed, there are just no operations; there are just no revenues. Obviously, that was the biggest challenge we've had in our 37-year history.
Thankfully, and thanks to the government's emergency support, we're still here. We intend to keep doing what we've been doing for the past 37 years in a bigger and better way, and in a new way with new partners, reaching out to the likes of Porter and others. We have a code-sharing agreement with WestJet as well. We're here to work with anyone and everyone, with a view to delivering reliable air service and competing in the marketplace.
:
I call this meeting back to order.
Colleagues, appearing before us for the second half, we have, from Abbotsford International Airport, Mr. Parm Sidhu, general manager, by video conference.
We have, from Flair Airlines, Mr. Stephen Jones, president and chief executive officer.
From the National Airlines Council of Canada, we have Mr. Jeff Morrison, president and chief executive officer.
Welcome to you all.
As discussed, I will be asking for unanimous consent to forgo our traditional opening remarks and have those submitted electronically and included as testimony, so that we can go straight to a line of questioning.
Do I have unanimous consent?
Some hon. members: Agreed.
The Chair: Seeing no objections, it is so adopted.
With that, I will be turning the floor over to you, Mr. Williams. You have six minutes, sir.
:
I'm not going to pretend it's been an easy journey. It hasn't, but we are still here. We've done it without any specific support from the government, with the exception of the RATI funding of $11 million we received, and that went directly to encouraging regional connections. We didn't get the $270 million that Porter got, the $370 million that Sunwing got, the $800 million that Transat got, or the $5 billion that Air Canada got.
We have been funded privately, and it's very tough, but again, we do it by being very focused on our business model, so we know what we're about. We're about low-cost, low-fare, affordable travel for all Canadians and being true to that model. It's a model that's worked in jurisdictions around the world. We believe there's nothing about Canada that makes it so different that an ultra-low-cost model shouldn't work here.
I hear a lot about how it's different in Canada. I'm here to tell you it's not. Every country is nuanced, but Australia is a big country, like Canada. It has 28 million people. Most of the people live within 100 miles of the coastline. It has half a dozen big cities, and it has 53 aircraft and Jetstar as an ultra-low-cost carrier. Chile is a long, thin country. It has four or five big cities. It has 17 million people, and it has three airlines. Two of them are low-cost carriers.
There's nothing specific about Canada or Canadians to say that they don't deserve affordable travel. They do deserve affordable travel, and Flair's here to deliver it.