"Open Skies" deal reached with Europe

[Rubberbiscuit]

A double edged sword in my opinion. Allowing more foreign ownership/investment might be good for those who need it. I don't see anything positive for Canadian operators in allowing foreign airlines to stop in Toronto or Montreal after a trans atlantic flight, to load up with pax and continue to say Vancouver or Calgary. Call me a protectionist if you like but the thought of someone like Lufthansa with very deep pockets coming in and potentially undercutting WJ and other Canadian companies does not give me a warm and fuzzy feeling!

Business Open-skies deal reached with Europe
More flights seen
By Scott Deveau, Financial PostMarch 30, 2009
StoryPhotos ( 1 )
The EU expects the deal to increase the number of travellers across the Atlantic by nearly 40% within a "few years."Photograph by: Alex Grimm, Reuters, Financial PostThe European Union gave the green light to a new air agreement with Canada yesterday it hopes will bolster competition and air travel, and pave the way for even greater liberalization of the airspace across the Atlantic.

Efforts to raise foreignownership limits, however, are not expected to be ready in time for the deal's signing, despite Parliament passing the necessary amendments to the Canadian Transportation Act earlier this month.

The first phase of the air pact will allow European carriers to fly to Canada from any airport in their 27-nation bloc, and vice versa. It will replace a patchwork of bilateral agreements that were deemed to violate the EU's efforts to establish itself as a single market by its high court.

Officials drafted the new pact in December, and the first phase is expected to be signed and implemented on May 6 in Brussels.

The move follows a similar arrangement between the EU and the United States, and has been lauded by Air Canada, WestJet Airlines Ltd. and Air Transat.

The EU expects the deal to increase the number of travellers across the Atlantic by nearly 40% within a "few years," create 1,000 new jobs and generate about $120-million in economic activity. Roughly nine million travellers flew between Canada and the EU in 2007, making it the second-largest market, behind the United States.

The new deal comes as carriers around the globe struggle with declining demand and the worst revenue environment for 50 years, according to the International Air Transport Association, which last week increased its forecast loss for the industry to US$4.7-billion for 2009.

The EU air agreement eventually aims to raise foreignownership limits on Canadian carriers, allowing the establishment of foreign-owned domestic airlines in each other's markets -- so-called right of establishment airlines -- and to allow for airlines to carry passengers on to a third destination after landing in each other's market, which is currently forbidden.

Parl iament passed an amendment earlier this month as part of its budget package that will raise the foreign-ownership cap on Canadian carriers to 49% from 25%. But Transport Canada said yesterday the regulatory framework will not be in place to do so by the May signing.

Raising those caps quickly, however, could throw a "life line" to Air Canada with its liquidity issues, according to Ben Cherniavsky, Raymond James analyst.

"Although very few global carriers are in a strong enough financial position these days to help out Air Canada, the strategic value of the company's domestic feeder traffic to members of the Star Alliance cannot be underestimated," he wrote in a recent note to clients.

In 1999, UAL and Lufthansa provided $730-million in financial support to Air Canada, fending off a takeover bid that would have seen it merged with Canadian Airlines and the oneworld alliance, he noted. "Albeit those were very different times," Mr. Cherniavsky said.

[2R]

Bye bye Cabotage protection ,
Welcome to the free world .
Amazing how many airlines can survive without governments subsidies and handouts on the rest of the planet.Simply because they do not have huge management overheads and fees.How many seats does Air Canada have to sell to pay ONE person 42 million dollars a year ?

I wonder how much Ryan Air will charge for a trip from Toronto to Vancouver or YVR to YHX

A cynic might say that it is a ploy to break the union if they strike or threaten to strike at big red

[yycflyguy]

Bye bye Cabotage protection ,
Welcome to the free world .
Amazing how many airlines can survive without governments subsidies and handouts on the rest of the planet.Simply because they do not have huge management overheads and fees.How many seats does Air Canada have to sell to pay ONE person 42 million dollars a year ?

I wonder how much Ryan Air will charge for a trip from Toronto to Vancouver or YVR to YHX

A cynic might say that it is a ploy to break the union if they strike or threaten to strike at big red

I think you have it wrong. How many government subsidies and handouts has AC received in its privatized existence? There are many threads on that topic so I wont bother.

If Luftansia takes advantage of the 49% ownership change the pilots will view it as a positive change. An airline understands the airline industry and would be interested in the long term sustainability as opposed to a holding company looking to "unlock shareholder value". An airline won't sell off all the assets, completely deplete its liquidity and slash and burn employee wages and work conditions. North American pilots are viewed as a problem on the global scale for allowing the degradation of pay and conditions of the profession.

IMO this is a precursor for what will happen this year with AC. Look for ze Germans to at least kick the tires at AC with a possible purchase.

[ajet32]

I look forward to it as long as we can keep Ryan Air out. We in North America have let our selves be downgraded to little more than bus drivers , wheras in Europe and the Middle East,Africa pilots still maintain respect and a decent life style.
As YYC Flyguy said maybe a Lufthansa or AirFrance/KLM would treat Ac as an airline and part of a group not as another cash cow run by a lawyer as it it now.
The fact that these carriers know something about service would be good for the sked industry in Canada both our major carriers seem to do little in the way of service.

[Leroy HOTDOG Zanzibar]

Do you think this will bring on mutual recognition of the flight test standards and medicals?
I hate having to do two medicals and rides each year to keep both current!
http://www.tc.gc.ca/mediaroom/releases/ ... -h237e.htm

[ScudRunner]

http://europa.eu/rapid/pressReleasesAct ... anguage=en

http://micro.newswire.ca/release.cgi?rk ... rt=0&htm=0

Air Canada welcomes Canada-European Union air transport agreement

MONTREAL, Dec. 18 /CNW Telbec/ - Air Canada issued the following
statement on the occasion of today's signing of a comprehensive air transport
agreement between Canada and the European Union (EU).
"Today's signing by Canada of a comprehensive air transport agreement
with the 27 Member States of the European Union marks an important
development in increasing access to Canada's second largest trading partner,"
said Duncan Dee, Executive Vice President and Chief Operating Officer. "This
new agreement opens up a realm of new commercial opportunities for Air Canada
throughout the EU. It allows Air Canada to further develop Canada as a
gateway to the world by capitalizing on travel demand between Canada, the
U.S., Latin America and Europe.
"Air Canada has long been an advocate of an enhanced aviation agreement
between Canada and Europe; we applaud the governments of Canada and the EU
for concluding this agreement that achieves balanced benefits for both
parties."

[Mig29]

North American pilots are viewed as a problem on the global scale for allowing the degradation of pay and conditions of the profession.

right on the ball !!

That's why we have guys flying jets here for under 40k/year, and commuter guys flying for much less then that! Not to mention our colleagues down south....shameful!

[nimbostratus]

If Luftansia takes advantage of the 49% ownership change the pilots will view it as a positive change. An airline understands the airline industry and would be interested in the long term sustainability as opposed to a holding company looking to "unlock shareholder value". An airline won't sell off all the assets, completely deplete its liquidity and slash and burn employee wages and work conditions. North American pilots are viewed as a problem on the global scale for allowing the degradation of pay and conditions of the profession.

IMO this is a precursor for what will happen this year with AC. Look for ze Germans to at least kick the tires at AC with a possible purchase.

If I'm reading this right, I would almost think that YYCFlyguy would rather have Lufthansa running Air Canada than ACE. If that is what you meant YYC, I would tend to agree with you. ACE is not in the airline business. It's in the investment business. All it wants to do is cash in on it's investment, not run a legacy airline.

Just my opinion of course.



Nimbo

[yycflyguy]

It's not that I don't trust ACE it's just that I don't trust them.

[Panama Jack]

Look for ze Germans to at least kick the tires at AC with a possible purchase.

To be renamed "Air Kanada"?

[Lufthansa]

Hope for the better !!!!!


Wolfgang Mayruhber: Kann Er Hier, Kana-da!!

[yycflyguy]

Look for ze Germans to at least kick the tires at AC with a possible purchase.

To be renamed "Air Kanada"?

Zig heil LuftKanada.

[fingersmac]

North American pilots are viewed as a problem on the global scale for allowing the degradation of pay and conditions of the profession.

And EU pilots paying for type ratings and line hours is any better?

[yycflyguy]

North American pilots are viewed as a problem on the global scale for allowing the degradation of pay and conditions of the profession.

And EU pilots paying for type ratings and line hours is any better?

Absolutely not... but guess where they go?

[fingersmac]

I have no idea what you're asking.

[loopa]

It's not better paying for your type rating but that's how it works in Europe. Because of their system, I'd like to believe that they have better working conditions. Pilot's are actually valued as professional individuals right from the get go. A friend of mine has 4300 hours with 200 piston and 4100 jet... he flies for Thomas Cook.

Then again, airline flying isn't for everybody but it seems as if most Europeans end up there.

[whiteguy]

I think you have it wrong. How many government subsidies and handouts has AC received in its privatized existence? There are many threads on that topic so I wont bother.

Yes many topics but no one can come with any facts. How many government subsidies and handouts has AC received? None!!! CP on the other hand???? Let see some facts!!!

[Finn47]

Air Canada will "expand it´s transatlantic presence":

Air Canada plans to expand its transatlantic presence next year, taking advantage of an aviation pact between Canada and the European Union. "This new agreement opens up a realm of new commercial opportunities for Air Canada throughout the EU," Air Canada chief operating officer Duncan Dee said in a statement yesterday. The carrier will also benefit from a four-company joint venture - dubbed Atlantic Plus-Plus - involving Continental Airlines Corp., United Airlines Inc., Deutsche Lufthansa AG and Air Canada. The Canada-EU agreement is a more important deal now than it would have been a year ago, when a tentative pact was announced, an industry insider said, adding that Air Canada will be pursuing a bigger international push in 2010. AC.B (TSX) rose 4 cents to $1.19.

http://www.theglobeandmail.com/report-o ... le1406422/

I can´t really see entirely new European destinations added in the immediate future. More frequencies perhaps?

[beaverbob]

I think you have it wrong. How many government subsidies and handouts has AC received in its privatized existence? There are many threads on that topic so I wont bother.

Yes many topics but no one can come with any facts. How many government subsidies and handouts has AC received? None!!! CP on the other hand???? Let see some facts!!!

I am old enough to know that AC was bailed out more than once by the Liberal Government. Not only were they bailed out when required (according to AC) they recieved the best route licenses.

CP on the other hand was never bailed out that I know of, unless it happened in more rescent times.
CP had to fight hard for routes, even in court. When CP was awarded the Pacific routes it was only because AC thought they would be unprofitable and did not want them. AC was fooled when CP showed profitability on those routes.
Am I correct, anybody?

[c170b53]

Duh..boys I'd be looking forward rather than engaging in twistory. I'm sure the Feds will look the other way to pay for all that cement and glass in YYZ, and YVR rather than find solutions to support the home aviation industry. The old CP shop could do anything Boeing, Honeywell or Douglas could do. Now its capable of minor repairs and soon YUL will be the same. Infrastructure that takes years to build, only takes a term in office to be B.S. away. Ironic, deregulation in our industry has lowered everything except taxes and fees.

[whiteguy]

I am old enough to know that AC was bailed out more than once by the Liberal Government. Not only were they bailed out when required (according to AC) they recieved the best route licenses.

CP on the other hand was never bailed out that I know of, unless it happened in more rescent times.
CP had to fight hard for routes, even in court. When CP was awarded the Pacific routes it was only because AC thought they would be unprofitable and did not want them. AC was fooled when CP showed profitability on those routes.
Am I correct, anybody?

In 95 or 96 CP received money from both the Alberta and BC governments to help keep it a float.

When exactly was AC bailed out by the liberal government? The liberal government did more damage to AC then anything else!

[Panama Jack]

Air Canada has, at least in post-merger times, been an advocate of market liberalization and so it does not surprise me that the airline applauds this Open Skies agreement with the EU.

As a next step, it would be great to see foreign ownership limitations reduced or lifted entirely on a reciprocal basis.

[Panama Jack]

We should hope so. Question is whether many Canadian pilots will have the appetite to write a battery of 12 theory exams or be required to do a Type Rating (2 crew) ride for their ATP?

[Panama Jack]

http://www.flightglobal.com/articles/20 ... anada.html

Open skies formally begins between the EU and Canada
By Megan Kuhn

A comprehensive open aviation agreement between Canada and the European Union has taken effect today now that the sides have formally signed off on the deal.

It removes all restrictions on routes, frequencies and prices for flights between the EU and Canada and will also lead to further liberalisation of traffic rights as ownership restrictions are lifted.

Initially any carrier will have complete freedom to operate between any point in the EU and any point in Canada. Freight carriers will have rights to operate onwards to third countries.

Once Canada loosens foreign ownership limits for airlines, raising permissible equity limits from 25% to 49%, a second phase will come into effect. This will extend further traffic rights, notably for cargo carriers.

When both sides enable investors to establish and control new operators in one another's markets, passenger airlines will be able to fly onward to third countries.

Once ownership restrictions are completely lifted, the fourth and final phase will free airlines to operate between and beyond EU and Canadian markets, and will also permit cabotage services.

Representatives from Canada and the EU expect an additional 3.5 million passengers will fly between Canada and the EU within the first few years of the implementation of the open aviation agreement.

"The new agreement makes the EU-Canada market one of the most open in the world and is a milestone for EU-Canada relations. It is an important sign that the EU and Canada are acting, not to close down their markets, but to remove barriers and improve links between people and businesses", European Commission vice president responsible for transport Antonio Tajani says in a statement.

Has anybody heard any estamated milestone timelines for the 2nd, 3rd and 4th phases?