Kelowna Flightcraft moving to YYZ

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Kelowna Flightcraft moving to YYZ

#1 Post by atpilot » Mon Mar 02, 2015 9:06 am

I just read this today. Good news for most of the pilots.


One of Hamilton airport’s major cargo carriers is in a tailspin after losing its only customer. To save itself, Kelowna Flightcraft is moving to Toronto.
Flightcraft spokesperson Grant Stevens said the decision to leave Hamilton was driven by access to potential customers, not by any lack or failing of the John C. Munro Hamilton International Airport. “We’ve lost our single source of revenue and cargo, and now the majority of the customers we want to fly for are based in Toronto,” he said. “Now we’re trying to break into a new market, so we have to be in Toronto.” Kelowna Flightcraft has been moving air freight through Hamilton since 1987 for Canada Post and Purolator. At the end of March it loses that business to CargoJet, also a Hamilton airport mainstay. To get itself back into level flight, the company will rebrand its cargo operation as KF Cargo and launch a new network to move freight to Europe through Toronto and Asia through Vancouver and Alaska. While Stevens wouldn’t talk about details of the new plan, a confidential internal memo obtained by The Spectator says said the company plans to fly cargo in two loops — from Toronto to Brussels, Belgium, four days a week, and from Toronto to Vancouver and Anchorage, Alaska, six days a week. Flights to Belgium are to start May 17. Flights to Alaska are to start in mid-July. Those routes will be supported by two domestic routes — Toronto to Halifax twice a day, seven days a week, and Vancouver-Calgary twice a day five days a week. “Unlike our previous contracts with (Purolator and Canada Post), we have no single customer, no guarantee of volumes, and no guaranteed revenue,” the memo said. “This network will put us in heavy competition with other operators (like CargoJet) but will give us the opportunity to demonstrate our innovativeness, reliability and dependability to a wide variety of potential customers.”
The company admits its plan is risky — it will have to spend millions of dollars on aircraft modification, crew training and new facilities — before the first flight even takes off. Stevens said the costs of the change will be financed internally. The freight operation moving from Hamilton is one unit of the Kelowna Flightcraft Group. Other divisions do aircraft maintenance under contract and training for the Royal Canadian Air Force.
The company was founded in 1970 and came to Hamilton in 1987. It has 1,000 employees across the country and a fleet capable of moving one million pounds (about 450,000 kg) of cargo.
Stevens said the company has 75 pilots based in Hamilton and expects to move 60 to Toronto. The rest will be offered other positions in the company or outplacement assistance. The maintenance operation in Hamilton currently employs 120 and “we anticipate we’ll see that grow by 10-20. We expect to see a net increase in jobs.” Airline analyst Robert Kokonis said Flightcraft’s new network will join a very competitive business, but the company has a good track record. (Kokonis does consulting work for Flightcraft.)
“Kelowna Flightcraft has a track record of taking their business in lucrative directions,” he said. “(Founder) Barry Lapointe is not going to waste his money. “Barry’s a survivor,” Kokonis added. “Entrepreneurs take risks, but he knows what he’s doing.”
Lauren Yakich, spokesperson for Hamilton airport, said the airport has not been officially notified of any changes to Flightcraft’s operations. “Kelowna Flightcraft hasn’t shared its fleet plan with us,” she said. “We don’t have anything confirmed so we can’t comment beyond that.”
Flightcraft’s decision to leave Hamilton comes just as final approval is given to the controversial Airport Employment Growth District — seen by many as the answer to the city’s growing need for employment land. Having cargo operators at the airport was seen by supporters as a key to drawing light manufacturers and other employers to the district. Hamilton airport’s courier and cargo companies handled 388.3 million kilograms of freight in 2013.
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Re: Kelowna Flightcraft moving to YYZ

#2 Post by Donald » Mon Mar 02, 2015 10:55 am

20% layoffs, forced move to yyz for the rest.

Good luck to all.

"Confidential internal memo" gotta love that.
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Re: Kelowna Flightcraft moving to YYZ

#3 Post by Longtimer » Mon Mar 02, 2015 12:25 pm

anada's Kelowna Flightcraft to rebrand, set up Toronto cargo hub
Logo of Kelowna Flightcraft© Kelowna Flightcraft Logo of Kelowna Flightcraft
5 hours ago
Kelowna Flightcraft (KW, Kelowna) is set to rebrand its cargo operation as KF Cargo as it moves to revitalize its operations following the loss of its Canada Post and Purolator contracts to rival, Cargojet Airways (W8, Hamilton, ON).

The Canadian freight specialist is to move its one of its two bases of operations from Hamilton, ON airport to Toronto Pearson in line with plans to develop the latter into an intercontinental hub for traffic to Europe and Asia.

"We've lost our single source of revenue and cargo, and now the majority of the customers we want to fly for are based in Toronto," Flightcraft spokesman Grant Stevens told Canada's Spectator magazine. "Now we're trying to break into a new market, so we have to be in Toronto."

According to the CargoFowarder site, KF Cargo's first flight to Europe is set to be to Brussels National with a tentative 4x weekly service to begin on May 17. Service is on-board one of the carrier's four DC-10-30(F)s. Other routes include a 6x weekly Toronto to Vancouver Int'l and Anchorage Ted Stevens, Alaska, service slated to begin in mid-July. The routes will be supported by two domestic routes — a 2x daily Toronto to Halifax flight, and a 2x daily (weekdays only) Vancouver-Calgary service.

The carrier said in an internal memo that the new business plan, while catering to no single customer with no guarantee of volumes, and no guaranteed revenue, will give it the opportunity to demonstrate its 'innovativeness, reliability and dependability to a wide variety of potential customers.'

“There is a lot of cargo from Europe, Africa and South America destined for Canada, but we are concentrating on the EU market through Brussels right now. The rest we’ll worry about later,” Bryan Akerstream, Director of Business Development, said.
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Re: Kelowna Flightcraft moving to YYZ

#4 Post by palebird » Mon Mar 02, 2015 12:41 pm

Ha ha ha ha ha....like a fish out of water Barry this will spell the end of KFC..They have no idea what they are getting themselves into and are twenty years behind the times with their DC10's. It might have worked in your little cocoon in Canada but not in the big bad open market.
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Re: Kelowna Flightcraft moving to YYZ

#5 Post by palebird » Mon Mar 02, 2015 6:19 pm

Seriously folks truth is stranger than fiction.. I wonder if they actually meant to release this news on April 01 and someone made a boo boo..
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Re: Kelowna Flightcraft moving to YYZ

#6 Post by Realitychex » Mon Mar 02, 2015 8:12 pm

palebird wrote:Ha ha ha ha ha....like a fish out of water Barry this will spell the end of KFC..They have no idea what they are getting themselves into and are twenty years behind the times with their DC10's. It might have worked in your little cocoon in Canada but not in the big bad open market.
I guess we'll see what sort of staying power the folks who bought the contract have.

Never underestimate Barry Lapointe.

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Re: Kelowna Flightcraft moving to YYZ

#7 Post by boeingboy » Mon Mar 02, 2015 9:17 pm

88 Ha ha ha ha ha....like a fish out of water Barry this will spell the end of KFC..They have no idea what they are getting themselves into and are twenty years behind the times with their DC10's. It might have worked in your little cocoon in Canada but not in the big bad open market.

Sorry - it's you that has no clue. There is actually a large overseas cargo market in this country. As for the 10's - yea - they are old, but they were the only type of widebody freighter certified in Canada. It cost them next to nothing to aquire and certify. Any other type of aircraft will cost millions of dollars and 6 or more months to certify.
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Re: Kelowna Flightcraft moving to YYZ

#8 Post by fish4life » Mon Mar 02, 2015 9:40 pm

I hope it works out well for KF and everyone there. It would have been very easy for the owner to just say screw it sell off all his assets and move to the Caribbean sipping on drinks. I applaud the fact he is trying to innovate and find a market to fly cargo keeping most of his employees getting pay checks.
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Re: Kelowna Flightcraft moving to YYZ

#9 Post by Diadem » Tue Mar 03, 2015 6:37 am

boeingboy wrote:As for the 10's - yea - they are old, but they were the only type of widebody freighter certified in Canada. It cost them next to nothing to aquire and certify. Any other type of aircraft will cost millions of dollars and 6 or more months to certify.
That's funny, I didn't realize Cargojet's and First Air's 767s weren't certified in Canada. Someone should probably let them know.
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Re: Kelowna Flightcraft moving to YYZ

#10 Post by l_reason » Tue Mar 03, 2015 7:12 am

This is going to require some new blood in YLW if it's going to be successful. This is a company that has been flying Boeings around Canada for 4 years without RNAV capabilities. That's right VOR to VOR to shout dive and drive NDB approach (B727). The crews are highly skilled and do a good job with the equipment they've got. I wonder how you plan on flying out of YYZ when you can't fly any of the arrivals or departures? Management is going to need an attitude adjustment to be competitive. With fuel burns of 9,000lbs/hr (4.1T) in the 727 and 17,000lb/hr (7.7T) in the DC-10. It's not going to be easy to complete with a modern equipment.

I think this news is just a ploy to make the pilots eat the pay cut that Grant Stevens shoving down their throats to get the retention bonus they were promised a year ago.
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Re: Kelowna Flightcraft moving to YYZ

#11 Post by palebird » Tue Mar 03, 2015 10:18 am

Boeing Boy there is no "large overseas cargo market" in Canada. Never has been. I love the Dc10 but it's day has come and gone. Finished. This is all just a joke that Barry is playing on somebody.And if he is silly enough to try it he will lose his shirt.
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Re: Kelowna Flightcraft moving to YYZ

#12 Post by AirMail » Tue Mar 03, 2015 11:14 am

How much are lease payments on a 57/67 per day/mth? I'm sure the extra fuel burn will still be less than a bunch of lease payments... I could be wrong. The non RNAV is a joke, funny hearing them on the radio asking for headings to a certain point. None the less, it's good to see that those old birds will still have some life and most guys/gals there still have a job.
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Re: Kelowna Flightcraft moving to YYZ

#13 Post by palebird » Tue Mar 03, 2015 1:37 pm

What people seem to be missing is "dispatch reliability" along with engineering support and parts support for an aircraft that Boeing has zero interest in. It is an old MDC aircraft remember... Boeing never were into the ongoing support and modifications of aged airframes, especially ones that they inherited. They would much rather sell you a new one. The flying that they are proposing is light years away from the hopscotch across Canada they currently do. Amusing..
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Re: Kelowna Flightcraft moving to YYZ

#14 Post by boeingboy » Tue Mar 03, 2015 3:03 pm

That's funny, I didn't realize Cargojet's and First Air's 767s weren't certified in Canada. Someone should probably let them know.
Whats really funny is if you read my post I used the past tense - at the time - the were.

Just like ACE did - cargojet almost went broke certifying them. It took forever, and of course - screwing over their customer for them didn't help matters any when they dumped them.......but thats another story.
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Re: Kelowna Flightcraft moving to YYZ

#15 Post by YYZSaabGuy » Tue Mar 03, 2015 3:14 pm

boeingboy wrote:As for the 10's - yea - they are old, but they were the only type of widebody freighter certified in Canada. It cost them next to nothing to aquire and certify. Any other type of aircraft will cost millions of dollars and 6 or more months to certify.
boeingboy wrote:Whats really funny is if you read my post I used the past tense - at the time - the were. Just like ACE did - cargojet almost went broke certifying them. It took forever, and of course - screwing over their customer for them didn't help matters any when they dumped them.......but thats another story.
You can perhaps appreciate why some of us might find this explanation confusing.
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Re: Kelowna Flightcraft moving to YYZ

#16 Post by BMLtech » Tue Mar 03, 2015 4:58 pm

I always get a kick out of the armchair quarterbacking on this site. Yes, the DC10 is old. It is also tough, and has an almost unlimited airframe life( like other MD products, it does not slowly turn into white powder, the way that old boeings do). The aircraft has the capability to lift payloads in excess of 50 tons over very long distances, and in my opinion, was being underutilized on the line haul. They are still in regular service with fed-ex in the MD10 modified format. Also heavily used by the US airforce as the KC10 extender, I'm sure they would know if it is viable or not. The price of jet fuel is down, and looks set to stay that way for a while. I think it's great that KF is finally going to use those aircraft for the overseas service they were designed for. Like others have said, they bought them for scrap value at the time when high fuel cost took them out of service with other carriers, so no capital costs to worry about, and they can put the money into good engine overhauls and maintenance. I wish them the best of luck, and also do not underestimate BL. I have never known him to lose money on any operation.
The one thing I would question is it seems to me that the DC10-30 did not pass the latest euro noise regulations and of course they must have RVSM etc. on board by now.
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Re: Kelowna Flightcraft moving to YYZ

#17 Post by Realitychex » Tue Mar 03, 2015 5:57 pm

YYZSaabGuy wrote:
boeingboy wrote:As for the 10's - yea - they are old, but they were the only type of widebody freighter certified in Canada. It cost them next to nothing to aquire and certify. Any other type of aircraft will cost millions of dollars and 6 or more months to certify.
boeingboy wrote:Whats really funny is if you read my post I used the past tense - at the time - the were. Just like ACE did - cargojet almost went broke certifying them. It took forever, and of course - screwing over their customer for them didn't help matters any when they dumped them.......but thats another story.
You can perhaps appreciate why some of us might find this explanation confusing.
If I had to place a bet on who the last one standing will be, I'd be pretty comfortable betting on KFC ahead of everyone else.

Recall the parable of the hare and the tortoise.

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Re: Kelowna Flightcraft moving to YYZ

#18 Post by glorifieddriver » Tue Mar 03, 2015 6:17 pm

Speculation or not, but the fact that there is a potential for 60 guys to keep their jobs is good! I am happy for that group. As for the bottom of the list, I am pretty sure over 70% of it are guys that started since they lost the contract and did not expect to keep the job past a year anyways, and in any case will probably easily find good jobs! It is easy to make it fun topic to harass, but for the respect of our co-workers we should just stay optimistic and hope they will continue bringing home a paycheck doing what they love! Hope it works out for them!
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Re: Kelowna Flightcraft moving to YYZ

#19 Post by Diadem » Tue Mar 03, 2015 9:13 pm

boeingboy wrote:
That's funny, I didn't realize Cargojet's and First Air's 767s weren't certified in Canada. Someone should probably let them know.
Whats really funny is if you read my post I used the past tense - at the time - the were.

Just like ACE did - cargojet almost went broke certifying them. It took forever, and of course - screwing over their customer for them didn't help matters any when they dumped them.......but thats another story.
Okay, but we're not talking about the past tense, we're talking about the present. You were trying to make the argument that this new KF venture has potential:
boeingboy wrote:Sorry - it's you that has no clue. There is actually a large overseas cargo market in this country. As for the 10's - yea - they are old, but they were the only type of widebody freighter certified in Canada. It cost them next to nothing to aquire and certify. Any other type of aircraft will cost millions of dollars and 6 or more months to certify.
But if the DC-10 is no longer the only widebody freighter certified in Canada, what does it matter that it used to be? It's no longer economical. If they launched this operation with DC-4s that they got for free from Buffalo, that wouldn't make it a good idea.
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Re: Kelowna Flightcraft moving to YYZ

#20 Post by boeingboy » Tue Mar 03, 2015 9:24 pm

But if the DC-10 is no longer the only widebody freighter certified in Canada, what does it matter that it used to be? It's no longer economical. If they launched this operation with DC-4s that they got for free from Buffalo, that wouldn't make it a good idea.
No - but they already have them - why not make them work, then go spend money one newer models while the old ones still bring in the cash?

What should they do? Spend a fortune certifying 747's or 777's or MD-11's? Not very smart to park everything and then go out and go broke certifying something newer.
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Re: Kelowna Flightcraft moving to YYZ

#21 Post by boeingboy » Tue Mar 03, 2015 9:30 pm

boeingboy wrote:

As for the 10's - yea - they are old, but they were the only type of widebody freighter certified in Canada. It cost them next to nothing to aquire and certify. Any other type of aircraft will cost millions of dollars and 6 or more months to certify.

boeingboy wrote:

Whats really funny is if you read my post I used the past tense - at the time - the were. Just like ACE did - cargojet almost went broke certifying them. It took forever, and of course - screwing over their customer for them didn't help matters any when they dumped them.......but thats another story.


You can perhaps appreciate why some of us might find this explanation confusing.


ACE was the first ones to certify a widebody freighter in this country - but went broke doing it.........When KFC needed a widebody freighter - the DC-10-30F was the only one certified, thanks to ACE........so it took them (relatively) no time at all to do. Far less time and far less money than to certify anything else.......and the aircraft were being sold on the used market for pennies on the dollar.

Cargojet made the same mistake with the 767's that ACE did with the DC-10's- in thinking it would be simpler (and therefore less expensive and less time consuming) than it actually was. Then they lost their original primary customer for that aircraft and very nearly went bankrupt.
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Re: Kelowna Flightcraft moving to YYZ

#22 Post by Diadem » Tue Mar 03, 2015 10:26 pm

boeingboy wrote:
But if the DC-10 is no longer the only widebody freighter certified in Canada, what does it matter that it used to be? It's no longer economical. If they launched this operation with DC-4s that they got for free from Buffalo, that wouldn't make it a good idea.
No - but they already have them - why not make them work, then go spend money one newer models while the old ones still bring in the cash?

What should they do? Spend a fortune certifying 747's or 777's or MD-11's? Not very smart to park everything and then go out and go broke certifying something newer.
Why not focus on being an AMO? Just because they have the aircraft doesn't mean they need to use them. They have 727s too, but they aren't keeping those in service. It's not like they're leasing the aircraft they own to an existing customer; they're creating a whole new enterprise, at the world's most expensive airport, competing against freight companies with far broader route networks, and they're doing it with aircraft that have three engines, need three crew members, and aren't RNAV certified. They're going to need to pay for ground handling at all of their airports, find customers who want their freight to go specifically to Anchorage and Brussels (or else they'd just use UPS or FedEx to get it right to their destinations), and underbid all of their competitors. I don't doubt that if a customer took a quote from KF to Purolator or UPS that they'd get a 5% discount from the quote, simply because those companies have the volume to take a bit of a hit like that in order to retain the customer.
Just because you own a horse cart that's been paid off doesn't mean you should try to compete with trucking companies.
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Re: Kelowna Flightcraft moving to YYZ

#23 Post by boeingboy » Tue Mar 03, 2015 10:51 pm

Because there is a market for this.

I agree - on the surface - simply stopping in Anchorage seems kind of odd, I'm sure there's a reason though.......maybe it's what his customer wants. No freight forwarder would use DHL or Purolator.....are you nuts????? It costs $9 to send a letter to Victoria. That's why they use belly space. Now give them a dedicated plane and you'd be surprised how fast you could fill it.

You do make some valid points, and I wouldn't use the 10's more than 2 or 3 years until you got something better - but the pros outweigh the cons in this case.

I mean come on......Do you really think Barry simply closed his eyes, pointed at a map and said "we're flying here - find someone to fill the plane"??? :roll:
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Re: Kelowna Flightcraft moving to YYZ

#24 Post by YYZSaabGuy » Wed Mar 04, 2015 5:39 am

boeingboy wrote:ACE was the first ones to certify a widebody freighter in this country - but went broke doing it.........When KFC needed a widebody freighter - the DC-10-30F was the only one certified, thanks to ACE........so it took them (relatively) no time at all to do. Far less time and far less money than to certify anything else.......and the aircraft were being sold on the used market for pennies on the dollar.

Cargojet made the same mistake with the 767's that ACE did with the DC-10's- in thinking it would be simpler (and therefore less expensive and less time consuming) than it actually was. Then they lost their original primary customer for that aircraft and very nearly went bankrupt.
Thank you for the explanation: I couldn't figure out why Cargojet would have to re-certify the DC-10 all over again when ACE had already done so. The 767 explanation makes more sense.
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Re: Kelowna Flightcraft moving to YYZ

#25 Post by corytrevor » Wed Mar 04, 2015 9:58 am

boeingboy wrote:Cargojet made the same mistake with the 767's that ACE did with the DC-10's- in thinking it would be simpler (and therefore less expensive and less time consuming) than it actually was. Then they lost their original primary customer for that aircraft and very nearly went bankrupt
Which customer did they lose? They have always flown UPS freight and still do.
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