Robert Milton is really getting under Clive Beddoe's skin

[Rebel]

Lisa Schmidt
The Calgary Herald

Thursday, December 29, 2005

CALGARY - Robert Milton is really getting under Clive Beddoe's skin.

It should be a happy time for the chief executive of WestJet Airlines Ltd. -- the airline is back in the black, planes are filled with holiday travellers and employees have collected more than 1,000 toys for sick kids at hospitals throughout Western Canada.

But there's little of the usual WestJet cheer when Mr. Beddoe seeks out a reporter at a charity event to criticize media coverage and complain about his competitor, the head of Air Canada's parent company.

"Why do you only report negative things about us?" he asks.

Despite all of WestJet's achievements this year, the media only focus on bad news about the Calgary carrier, Mr. Beddoe complains.

At the same time, no one questions his rival, Mr. Milton, being named chief executive of the year earlier this month by Report on Business magazine.

"How do you bankrupt a monopoly and get named CEO of the year?"

Mr. Milton, president and chief executive of Air Canada parent ACE Aviation Holdings Inc., cut his employees' salaries while accepting rich stock options for himself, Mr. Beddoe adds. When WestJet lost money, Mr. Beddoe slashed his own paycheque to one dollar, but he says media made little mention of it -- squeezing an index finger and thumb together to show just how small.

It's been a tough year for WestJet, and Mr. Beddoe is apparently a little grouchy.

The carrier reported its first loss in its nearly 10-year history, as fuel costs rose and fierce competition from Air Canada and Jetsgo drove down fare prices. The airline remains locked in a legal battle over Air Canada's corporate espionage lawsuit, and its share price, which received a boost in the wake of the Jetsgo collapse in March, has lagged in recent months.

At the same time, its much larger rival, Air Canada, which emerged from bankruptcy protection in the fall of 2004, is on the rebound, earning $270 million in the third quarter -- the best of any North American carrier.

The Montreal airline has been adding smaller jets and more routes on WestJet's home turf in Western Canada. Earlier this year, it spun out its loyalty-program Aeroplan division and plans to do the same with part of its regional division Jazz.

Air Canada has made a huge turnaround this year, while WestJet's performance has been about average, says Doug Reid, an associate business professor at Queen's University.

"For WestJet, average is really a new position. ... They've been wonderful for a long time, and everybody has looked at them and said 'Aren't you guys the smartest people in the world -- you've got this whole crappy business figured out.'

"Fact of the matter is, they didn't -- they were just lucky. They did some smart things, but they had dumb competitors who in 2005 are now smart competitors."

WestJet marks a decade in business in February, having grown from a modest three planes and five cities to become the country's second-largest carrier, flying coast-to-coast and into the United States.

In the first half of the year, the carrier struggled with high fuel prices and the effects of a fierce fare war with Jetsgo that lingered months after the Montreal-based carrier went out of business. In its latest quarter, WestJet reported profits rose 44 per cent to $30 million.

The carrier also has fuller planes as it continues to expand its network -- adding Hawaii earlier this month. Its new U.S. routes have been popular with Canadian travellers, but American customers have been slow to get on board.

Where competitors have taken away perks -- Air Canada started charging for pillows -- WestJet added television service to its jets, which will be the newest fleet in North America once the airline retires the last of its fuel-guzzling 200 series aircraft early next year.

Meanwhile, WestJet's share price, which hit $17.29 on the Toronto Stock Exchange after the demise of Jetsgo, has languished around $12 in recent months. Air Canada shares have averaged $36 in the past year, trading as high as $42.53.

Both carriers have struggled with higher jet fuel costs. The two airlines have raised fares twice this year, but continue to match each other's seat sales.

"This next quarter's going to be interesting because now they are into a slack time of year with high fuel prices," said Barry Prentice, director of the Transport Institute at the University of Manitoba. "It will be surprising to me if they actually do manage to be profitable this quarter."

WestJet is also still mired in a court fight over Air Canada's $220-million lawsuit, originally filed in April 2004. Earlier this year, an Ontario judge tossed out WestJet's counterclaim, which alleged the airline was the target of a smear campaign by its larger rival.

This month, Air Canada submitted a trail of e-mails between Westjet officials with subject lines such as "007" and references to Air Canada as the "evil empire." The e-mails allegedly contained real-time, flight-specific competitive information that could be used by WestJet to help plan transborder flights to the United States. None of the allegations has been proven in court.

Mr. Beddoe has distanced himself from the issue, claiming he was not aware of the actions of former executive and co-founder Mark Hill. However, one e-mail shows Mr. Hill forwarding Air Canada data to Mr. Beddoe's private e-mail, warning an earlier version sent to his work address should be deleted.

"I'd argue, if anything he's been getting off light," Mr. Reid says.
© The Ottawa Citizen 2005

[exbengal]

[quote="Rebel"]Lisa Schmidt
The Calgary Herald

Thursday, December 29, 2005

CALGARY - Robert Milton is really getting under Clive Beddoe's skin.



At the same time, no one questions his rival, Mr. Milton, being named chief executive of the year earlier this month by Report on Business magazine.

"How do you bankrupt a monopoly and get named CEO of the year?"

Mr. Milton, president and chief executive of Air Canada parent ACE Aviation Holdings Inc., cut his employees' salaries while accepting rich stock options for himself, Mr. Beddoe adds. When WestJet lost money, Mr. Beddoe slashed his own paycheque to one dollar, but he says media made little mention of it -- squeezing an index finger and thumb together to show just how small.

Rebel, you have to admit, Clive does make one valid point here.

[cyyz]

employees have collected more than 1,000 toys for sick kids at hospitals throughout Western Canada.

Mr. Beddoe seeks out a reporter at a charity event to criticize media coverage and complain about his competitor, the head of Air Canada's parent company.

"Why do you only report negative things about us?" he asks.

He made two valid points... They do only mention the "bad." But atleast they don't go into their forum and gloat, like certain members of the AC board who will post every little thing AC does...

[Long Keel]

"How do you bankrupt a monopoly and get named CEO of the year?"

Hmmm.

- Government forced AC to takeover its bloated ready to liquidate competitor,

- then same government forbids AC to make any layoffs...while the new aircraft they were forced to aquire through takeover were gas guzzlers,

- and didn't match the fleet makeup of AC, (DC10, 737, F28),

- while the new employees were senior staff who all went to top payscale after the takeover,

- that less than two years after the takover with its cash reserves depleted due to reasons above faced 9/11, Iraq war, SARS with 24/7 CNN coverage at its main international hub, and record fuel prices,

- oh yah, how many legacy airlines are in Ch11 down south while receiving hundreds of millions of aid from their government, apparently AC is the only company to face this,

- oh yah, and AC's main competitor was running a black ops department getting all of their load info so they could run loss leaders against AC's more profitable flights, creating software to hack their system up thousands of times, and getting illegal faxes from airport managers with confidential data all to harm AC's chances of recovery,


All these things were Milties fault, yah right....


- How can any man call his competitor a monopoly? If AC was a monopoly, he wouldn't exist!

The fact is, even though Miltie can be a prick to deal with, every AC employee out earns every WJ employee; even after their CCAA paycuts by a wide margin, and AC has filled more seats, and earns more money than WJ. The company didn't get a penny of help from the feds during CCAA. Look at Bombardier, hell look at WJ which used government money from the federal EI department to fund their pilots training. AC's money came from the free market, and no laws were broken, and nobody is getting sued for the process.

The business world sees what has been done and recognizes the accomplishments as huge. Apparent Clive and his merry band of worshipers are the only ones out of the loop. But, hey Clive did order TV's, BRAVO!!

[tonysoprano]

Long Keel.
I hear what you're saying. I'm afraid you will never convince the rif raf. It's not just Clive. Just look at what our regionalwiners are saying. Nothing will ever change. I can't believe words such as "monopoly" are still being used. Wake up folks. That era died a long time ago. Clive says "only the bad things about WJ get reported". Oh really? He always makes it sound like there are no bad things at WJ. So what bad things are there to report? I don't think this guy can ever be fit to run a major airline. I would suggest he will be the detriment of his own company if he's not carefull. Lately, I think most Canadians are being turned off by this guy more and more. A word of advise to all the new hires at AC mainline: take it all with grain of salt and enjoy a long rewarding career at a great outfit.

[Long Keel]

A word of advise to all the new hires at AC mainline: take it all with grain of salt and enjoy a long rewarding career at a great outfit.

Amen brother!

[The Hammer]

Dear Clive

Welcome to the real airline world!!! Your no longer a little upstart from Calgary. Now you get picked on and attacked just like the big boys. Get a little bigger and the "frivolous lawsuits" will show up.

Air Canada makes the news when they remove pillows and ban live animals during the holidays (something WestJet did as well).

Now that you're CEO of a international airline you are going to read things that aren't printed by the West Jet happy, Calgary Herald.

You goin to have to get a little thicker skin Clive, cause no likes a Whiner!

[flyer 1492]

Poor Clive,

It must be really hard to be called average. Your stock is under performing. You appear to be running out of NEW ideas. If I was an employee of WJ, I would be embarrassed by his outbursts.

Flyer

[Rebel]

Do you think Clive is mad at us because we didn’t send him a Christmas card? Nah..

Oh well Happy New Year Clive..

[complexintentions]

Lisa Schmidt
The Calgary Herald

Thursday, December 29, 2005


"For WestJet, average is really a new position. ... They've been wonderful for a long time, and everybody has looked at them and said 'Aren't you guys the smartest people in the world -- you've got this whole crappy business figured out.'

"Fact of the matter is, they didn't -- they were just lucky. They did some smart things, but they had dumb competitors who in 2005 are now smart competitors."

Best quote in the whole article. It's becoming clear that Beddoe actually believes it was his and the WJ's principals brilliance that was responsible for WJ's success. Must suck to have cold water poured on your ego.

[complexintentions]

dbl post, grrrr

[cyyz]

Now that you're CEO of a international airline you are going to read things that aren't printed by the West Jet happy, Calgary Herald.

When did that happen?

[Bede]

The best advice I ever got from a boss is this:

"Every business has it's time under the sun."

One minute you're the company that can do no wrong (WJ in 1999), the next minute, nothing goes right.

[The Hammer]

Last time I checked, Florida, California, Hawaii, Cancun, Dominican, Cuba, Puerto Vallarta, etc. were all not in Canada

Domestic airlines don't leave their country ie Calm air, all others are international (even without the USA, Westjet still visits many countries)

[cyyz]

Last time I checked, Florida, California, Hawaii, Cancun, Dominican, Cuba, Puerto Vallarta, etc. were all not in Canada(even without the USA, Westjet still visits many countries)

Ummm, maybe I don't know how to use the WJ buy a fare thingy, but I can't find anything outside of Canada and the US. I didn't bother adding a "from" city, just scrolled through the "TO"

http://c3dsp.westjet.com/guest/home.shtml?language=EN

Maybe you could find me an International location, and the US isn't "international."

The airline operates a fleet of Boeing aircraft featuring new Next-Generation 737 aircraft with leather seats and more legroom. Transborder service commenced in the fall of 2004 to the cities of Los Angeles, San Francisco, Phoenix, Fort Lauderdale, Tampa, Orlando, and New York. Service to Palm Springs began in January 2005. WestJet is publicly traded on the Toronto Stock Exchange under the symbol WJA<period>

http://c3dsp.westjet.com/guest/about/hi ... mplate.jsp

Would have been nice to mention something about international travel, if they so did offer it...

[complexintentions]

Try talking to your travel agent. Their international destinations are vacation charters so they won't be on the page selling their sked.

[Traf]

tony wrote

regionalwiners are saying

Care to elaborate? Seems pretty sad that in a WJ bashing thread you can't hold back from bashing the regionals. I hate to break it to ya Tony, but all that stuff that keel mentioned actually includes Jazz.

I guess X-mas is over. Time to take the gloves back off?

[tonysoprano]

Traf.

Nothing specific other than a general feeling of bashing that comes from the Jazz types towards the mainline. Thread after thread seems to have it. I particularily like the one where it was stated that Jazz pilots should not have had any cuts because they are not part of the mainline. Traf, I could go on but I really don't want to waste anybodies time here. Yes we bash Jazz too. It goes both ways. I ended my thread by suggesting that if you are a newhire at the mainline, get ready to hear all kinds of bahing from WJ and Jazz against us and to just let it slide and enjoy your work here. You conveniently left the rest of my thread out. And like him or not, Milton did make this place stronger and profitable. Thanks to us and YOU.

[double-j]

Tony, just curious...Did you come from the connectors?

respectfully

jazzy

[tonysoprano]

Yep.

[cyyz]

Try talking to your travel agent. Their international destinations are vacation charters so they won't be on the page selling their sked.

If it's a charter it's not an international airline. With that logic Bearskin, Air Georgian, Jazz, anyone is an "international airline," you offer them cash and they'll charter you a flight anywhere you want.

[The Hammer]

Main Entry: 1in·ter·na·tion·al
Pronunciation: "in-t&r-'nash-n&l, -'na-sh&-n&l
Function: adjective
1 : of, relating to, or affecting two or more nations <international trade>
2 : of, relating to, or constituting a group or association having members in two or more nations <international movement>
3 : active, known, or reaching beyond national boundaries <an international reputation>

CYYZ IF your gonna get picky your own post states WESTJET IS a international airline cause we ain't the 51st State yet!!! Do people flying between YYZ and YOW have to clear customs??

Maybe you could find me an International location, and the US isn't "international

Ummm, maybe I don't know how to use the WJ buy a fare thingy, but I can't find anything outside of Canada and the US. I didn't bother adding a "from" city, just scrolled through the "TO"

[Traf]

Cmon tony, your posts always make it like Jazz is the problem and the poor mainline guys keep getting picked on. I have been here long enough to see through the bullshit. Both sides are bad. Very bad to be exact. I have seen DC9s give Dash 8s the finger and seen grumpy old dash drivers refuse a jumpseat to a mailiner when he was trying to get to TO for work. IMHO, it is disgraceful and pathetic.

The current and future pilots for both sides will have to live with the old timers legacy. What will it cost? Pay, vacation and work rules to protect their own work. As much as some hate Milton, you have to respect the fact that AC showing profits while the US carriers are still floundering after bankruptcy. You also have to admire how he uses the divided groups to get what he needs.

As for the Jazz guys not taking cuts, I believe you are now the one leaving out info. That was a remark made in reference to the fact that when CCAA hit, ACE made sure we all took the hit but when times got better, they were turning our guys down at a rate of 80plus percent. The company took away our triple time because ACPA whined, yet they claim we are too distinctive companies with no ties. Which is it? Are we a part of the gand scheme or not? Seems when they need us to be we are, but not when we want to be. Unfortunately, we seem to be the weapon of choice for getting cuts at mainline. Look at the pay on the EMB and relief guys starting at AC now. On the flip side, Jazz pilots are flying 75 seaters for less than our previous 36 seat wage.

Clap clap clap!!! let's keep it up and see how low we can go in the future.

[Jaques Strappe]

Traf

I enjoyed your last post. Something to add if I may, When our contracts were last negotiated, CCAA was the weapon of choice for Milton. Not really one group against another, although that is a major issue.

Do you think it is a coincidence that Milton is talking about leaving now, as contracts start maturing? He will take his ( our ) money and run like a bandit.

He will have a hard time trying to sell everyone on the need for wage capping when he is planning on giving 300 million to "new" shareholders who didn't lose a thing.

As far as Clives' comment about how Milton could be named CEO of the year after bankrupting a monopoloy, while it made me laugh, it shows that Clive thinks his audience is pretty naive.

Both of these guys are sleazy, IMHO

[tonysoprano]

ACE owns Jazz and Air Canada. It runs them as separate entities but in the end it is one bank account. When ACE reports profits or losses it includes both companies. It only makes sense that when cuts are to be made, they are made across the board. Renewal time is coming up and although we won't get it all back, some things will return. As far as taking Jazz guys, I'm sure AC would love to. Where does that leave Jazz? With too big a whole to fill. In my day AC was getting 50% of it's pilots from Jazz because it could be done. Now Jazz is expanding at a rate faster than AC. How could we take 50%. It doesn't make sense. Nothing personal Traf, just a business decision. Perhaps your management has something to do with it too. Tripple time? At a time when the company is in need of productivity? It's not whining Traf, it's a matter of survival. If you get tripple time, I want my 15% back on my salary and then some. It never ends does it? Like I said, take it with a grain of salt and enjoy the ride. To me, it's still the best deal in town.