Flying into trouble

The inside story of Canada’s fight with the United Arab Emirates and how it went so wrong

by Chris Sorensen and Aaron Wherry

Flying into trouble

Using its Airbus A380s, Emirates wants to offer daily flights to Toronto; Rovinescu accuses Emirates of being a foreign predator | Chris Ratcliffe/Bloomberg/Getty Images; Darryl Dyck/CP

In early October, Canada’s armed forces learned they had just one month to pack up and move a key Mideast military base used to support the war in Afghanistan. Located in the United Arab Emirates, Camp Mirage has been used primarily as a transfer point for Canadian Forces flying to and from Kandahar. For the past eight years, it had provided the Forces with a safe place to land and refuel hulking Hercules transport planes while weary soldiers relaxed at a makeshift camp, complete with a ball-hockey rink.

But the desert oasis, a short drive from Dubai’s beaches and air-conditioned shopping malls, ceased to be part of the military’s operations as of Nov. 3, following a high-level spat between Ottawa and the U.A.E. over commercial airline flights between the two countries.

It was an abrupt end to a long-standing strategic relationship between the countries, and it sent the military scrambling. “It’s a pain in the ass for all these guys who are supposed to be doing other things,” says Douglas Bland, the chair of defence management studies at the School of Policy Studies at Queen’s University. “Now they have to stop, pack up and move all of this equipment.” At no small cost: by some estimates $300 million.

So why, exactly, did Canada and the U.A.E. let an argument over business destroy nearly a decade of co-operation in the war against terrorism? Ottawa insiders say Prime Minister Stephen Harper was infuriated by the U.A.E.’s decision to try to use the base as leverage in a trade dispute. But there is also evidence to suggest Air Canada was able to convince cabinet ministers that the U.A.E.’s state-backed airline, Emirates, was a major threat bent on taking over the international market—even though what was really on the table were flights to just a few major Canadian cities.

Like everything in Dubai in recent years, Emirates is the product of the government’s lofty ambitions. The airline’s jaw-dropping growth over the past two decades—it’s in the process of doubling its fleet of nearly 150 aircraft—is closely tied into efforts to make Dubai a global hub for business and tourism. Already Emirates, which flies 14 double-decker Airbus A380s and has another 76 on order, flies to every continent (except Antarctica) with a business model built on frequent flights between big hub airports like London, Frankfurt and New York.

Canada, however, has proved to be a tough nut for Emirates to crack. The airline is currently permitted just three flights a week to Toronto. And despite more than five years of heavy lobbying that won support from consumer groups and even Alberta Premier Ed Stelmach, Transport Canada has consistently rebuffed requests to give Emirates permission to offer four more flights a week to Toronto and launch daily flights to Calgary and Vancouver. “We feel the rights under the current agreement meet the current demand,” says Transport spokesperson Patrick Charette. A spokesman for Transport Minister Chuck Strahl, meanwhile, said Ottawa would monitor air travel between the two countries and make changes as warranted.

It’s not the outcome the U.A.E. had been hoping for. Officials became agitated by the “protectionist” attitude of Canadian bureaucrats earlier this year, according to industry and political sources familiar with the negotiations. So, when Canada’s rent-free lease on Camp Mirage expired in late June, sources say the U.A.E. agreed on an extension providing that Ottawa take a fresh look at the issue. An informal committee was created in July and three Canadian representatives travelled to Dubai the following month for a meeting that apparently went nowhere. “It was terrible,” said one industry source. “They flew all that way and stated that [Canada] had nothing to offer. The U.A.E. was stunned.” Another meeting took place in Paris in September. Canadian representatives brought with them a revised offer, although sources say it was actually viewed by the U.A.E. as being worse than the status quo.

Sources say that House leader John Baird was a key player when it came to setting Ottawa’s tough tone throughout the negotiations. As a former transport minister, he presided over Air Canada’s liquidity crisis in 2009, which ultimately resulted in a $250-million government loan designed to keep the airline in the black. But it was during a meeting U.A.E. officials had with Foreign Affairs Minister Lawrence Cannon in late September in New York when tensions boiled over. “By all accounts it was a horrendous meeting,” says one person familiar with the U.A.E.’s approach to the talks. (Almost no one involved would speak on the record about the high-level discussions.) It was at that point that bilateral relations between the two countries broke down and it became clear there would be no more renewals of the lease on Camp Mirage, leaving the military to relocate operations to Germany and Cyprus. For his part, Cannon told Maclean’s that Canada expects to maintain a “positive” relationship with the U.A.E..

In early October, a C-17 jumbo transport carrying Defence Minister Peter MacKay (who was keen to find a resolution to the dispute), Gen. Walter Natynczyk and Veterans Affairs Minister Jean-Pierre Blackburn was denied the right to land at Camp Mirage on its way back from Afghanistan. The development was followed by rumours that Ottawa had banned cabinet ministers from flying on U.A.E.’s airlines—which government officials later denied—and a decision by the U.A.E. to require Canadians visiting the country to begin carrying visas.

It’s a resounding failure of diplomacy and trade negotiations on both sides. While it’s true, as Transport Canada suggests, that there isn’t a huge demand for travel between Canada and the U.A.E., observers say there is nevertheless a significant number of Canadians who would likely jump at the chance to use Dubai as a way to connect to destinations in the Middle East, Africa and the Indian subcontinent—regions of the world where Emirates operates an extensive network, but Air Canada doesn’t fly to directly.

Air Canada, however, convinced Ottawa that Emirates represents a mortal threat to many of its European routes—particularly from secondary Canadian cities like Ottawa, Halifax and Edmonton, which are padded with passengers who are trying to get to, say, India, but must first fly Air Canada to Frankfurt before connecting on Lufthansa, a Star Alliance partner. “What you would end up having is one or two fewer flights to London or Frankfurt out of Toronto, and no flights to Europe out of Halifax, Ottawa, Edmonton and Calgary,” said an industry insider familiar with Air Canada’s network. Of course, that assumes people in most of those cities would prefer to fly to Toronto to catch a flight on Emirates to Dubai, and then connect a third time to their final destination, as opposed to just making one connection onto Air Canada’s partners in London or Frankfurt.

Regardless, Air Canada CEO Calin Rovinescu commended Ottawa’s “backbone” for standing up to the U.A.E., arguing in a speech last week that Canada should only sign open skies agreements with countries where there is significant two-way travel. “We are not supportive of demolishing our hubs and gateways,” he said. Rovinescu has previously accused Emirates of being a foreign predator that intends to flood the Canadian market with cheap seats in a bid to steal market share, calling it “a state-owned carrier with access to virtually unlimited capital”—a charge Emirates emphatically denies.

Air Canada isn’t the only one complaining. Last month, Pierre-Henri Gourgeon, the CEO of Air France-KLM Group, told Bloomberg that Europe needed to “resist” the encroachment of Emirates and other Gulf carriers. He made the remarks prior to a meeting of the Association of European Airlines, where the heads of British Airways and Lufthansa were expected to discuss the issue further.

Still, industry observers wonder whether there was truly no middle ground between Canada and the U.A.E.. “If things had been left to run their course, I believe the U.A.E. would have come away with some enhanced access,” says Robert Kokonis, a Toronto-based airline consultant. He says the U.A.E.’s mistake was to link the issue of a military base to the dispute, a decision he argues was likely made because Emirates is under pressure to find homes for the huge number of planes that it ordered prior to the global recession. “That’s why they are taking such a bullying approach,” he says, adding that he thinks that Harper was right to take a hard line against such tactics.

But Ottawa is also partly to blame for this mess. One of the reasons Air Canada is fighting tooth and nail to keep Emirates out is because it knows it can’t compete with the Gulf carrier’s low-cost structure, which stems in part from Dubai’s decision to promote the airline industry, not treat it as a cash cow. Canadian airlines, by contrast, are saddled with steep taxes on jet fuel, security fees and an airport rent scheme that has made hubs like Toronto’s Pearson International Airport among the most expensive in the world for airlines to operate in—a criticism levelled by both Air Canada and foreign airlines alike.

What’s also being lost in the debate is what is best for consumers. Ottawa’s protectionist stance risks putting the country out of step with the rest of the world as it rapidly moves toward more open regimes that encourage competition and lower prices, and which has spawned a new generation of airlines that are eager to shake up the industry. “The world has changed,” says Andrew Parker, Emirates’ senior vice-president of public, government, and environment affairs. “It’s 1950s-era thinking that looking after a country’s flag carrier is in the national interest.” And it comes with a 21st century price tag, as our armed forces have just learned the hard way.




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Flying into trouble

  1. It is indeed unfair to have a "level playing field" if one competitor is unfairly subsidized by a government. So, um, tell us more about that stabilization financing that Ottawa gave to Air Canada?

    • You state it so correctly!! It IS unfair to have a competitor so heavily subsidized by a government. That's why Air Canada has paid all of the "stabilization financing" back!

      • A loan from the lender of last resort (government), to a debtor with a higher probability of default, with attractive financing terms that would be unavailable in the marketplace? Is a subsidy.

        • The loan was fully secured and the rate was over 13% so the government did quite well on this. The real reason Air Canada is in bad shape is the pension overhang from the forced merger with Canadian Airlines thanks to Collinette and the LIberal party.

    • Were you aware that the Gov of Canada purchases goods and services in the market place? It is true. What you call a subsidy (and it would appear that any thing MYL calls a subsidy is a) bad & b) unfair) is in fact the GoC purchasing services to further their raison d'etre: governing. There are a great number of businesses that would chuck free market principles (as if they ever held them) under the bus should the GoC stop purchasing goods and services.

      Doesn't it make sense for the GoC to use it's capacity as lender of last resort if failing to do so would mean a serious impediment to its governance objectives? If it were up to you, you'd let any accidental/intentional distortion in markets destroy the labour and investment of companies, chalking it up as a bizare confirmation of your quasi-economic eugenics. Nice in (your) theoretical world, but not sound governing praxis.

      • You do get that black-pot Air Canada was whining about black-kettle Emirates Air being subsidized, don't you? Well, actually, maybe you don't. So there you go. Maybe you'll get it now.

        • I am well aware of what is going on. The difference is that you are calling far too many things subsidies and every time you utter the word "subsidized" it is as a pejorative. Poor service levels or no, see no reason to sacrifice AC over the lack of a loan.

          • They could have found a loan. But they fell in love with an undeserved lower interest rate courtesy of the present and future taxpayers of Canada.

      • is in fact the GoC purchasing services to further their raison d'etre: governing.

        Ah! So that's why we're digging holes and filling them back up again.

        Were YOU aware that government purchasing goods and services to honour its constitutional responsibilities (that governing thing) is rather different from showering the marketplace with pork, or competing with other lending institutions in the marketplace by undercutting them on price (interest rates) for the higher risk creditors?

        • If the government has a recognized capacity as lender of last resort, does that not suggest that it is a market participant? It does to me.

          You can't be undercutting someone on price when you (GoC) is the only one making offerings for the business. Businesses, with a fair degree of regularity, make use of the restructuring system. I fail to see why you have such a problem with this fact. It really looks like an ideological blindspot.

          • As a sick puppy, AC should be subjected to higher interest rates when it borrows. There may have been lenders willing to assume the risk and sign a deal at a higher rate. The government distorted the market by assuming that risk for free, and offering a lower rate (or, for all I know, no interest rate at all). Ergo, subsidy. It's just a straight-up definition. Failing to recognize this as a subsidy is the marker of an ideological blindspot. I hope your vision is improving.

          • I am grateful for your concern after my health. Rest assured that, through a judicious combination of public and private expenditure, I find myself in robust good health.

            On another point of curiosity, you do not by chance, sell used autos for a living, do you? If AC was already facing, for reasons neither you or I full comprehend, a cash flow crunch, then how would getting financing at a rate, presumably, higher than what they are already paying make any sense?

          • Capitalism 101, because it seems just about everybody needs a remedial tutorial around here:

            Business in tight spot? Options include: (A) take on more debt, at a well-deserved higher interest rate given the inherent risks, and try to turn things around; (B) issue more shares, diluting the equity of current shareholders, but enjoying some extra capital to try to turn things around; (C) sell off non-core assets to obtain a little breathing room in the debt column, and try to turn things around;

          • (D) re-negotiate current debt (e.g. "sixty-five cents on the dollar") to an agreement acceptable to nervous creditors who might otherwise get squat, then try to turn things around; (E) read the writing on the wall, see there is no hope, and wind down operations, selling off the business in whole or the assets bit-by-bit, to the benefit of creditors according to the priority established in law (which, I believe, is shareholders last in line). There are certainly others, including converting creditors into shareholders, which erases some debt and dilutes equity, and bankruptcy court, which seeks to keep the company afloat under responsible supervision, and imposes some combination of measures described above. These are the sort of acceptable punishments laggard companies and their executives and ownersshould face when they have screwed up.

          • But no. Let's reward these losers instead with heaps of cheap cash, courtesy of the taxpayers, including those businesses whose actual success has just been punished through taxation in order to prop up the loser competition. This, some of us like to call "sound governing." Blech.

          • Statesmanship Graduate level, because it seems you have only one way of looking at things, when a comprehensive view is needed.

            Duopoly in a tight spot? Options include: A) run it like the utility that it is meant to be b) ignore those harpies that attempt to apply the wholely inappropriate model of "free" enterprise c) suck up the loss because it was previous government actions, having fallen prey to the siren song of deregulation, that got the (previously) state carrier into it's current straights in the first place and caused the other, Canadian Airlines, to go under. D) recognized that in the current environment of massive subsidies across the board to all carriers, you can't let a little thing like a trade dispute with a minor principality be sufficient reason to throw all your other work out the window.

            You've got to think like a statesman. What kinds of costs will Canadians and Canadian business and industries be facing without AC, given that there is no readily available replacement? Is that cost greater than taking on the somewhat high risk of making a loan to AC? Ya, now you know why the loan was made.

          • See, you are still limiting your vision. Open the skies. If Aloha Airways would like to take a run at Toronto-Vancouver-Honolulu, and is willing to pay true cost for landing rights and gates like every other airlines, so be it – we now have another choice for Pearson-to-YVR. It is government meddling that has led to your "duopoly" in the first place. And deregulation did not "cause" Canadian Airlines to go under. It, rather, ended the propping up of a failed business once it was required to compete.

            A "national civilian air carrier" as a utility? Nope. Not even close. And, don't worry, I have given up convincing good ol' pragmatic ColdStanding of these truths. But I do hope this conversation (for which I thank you) might offer others a chance to consider the thoughts carefully.

          • It would hardly be an interesting conversation if I agreed with you.

  2. It is indeed unfair to have a "level playing field" if one competitor is unfairly subsidized by a government. So, um, tell us more about that stabilization financing that Ottawa gave to Air Canada?

  3. If the problem for Air Canada is that it can't compete due to the burden of taxes and fees it must pay, then eliminating competition does not address the root cause of the problem. But I think the real problem for AC is the pressure they are getting from their masters in Star Alliance. Dubai's gain is Frankfurts loss – and Lufthansa has the squeeze on AC to tow the line and prevent Dubai from competing. For Canadians, that protection of Frankfurt means we pay more for flights that require more connections and take more time…so that we can protect jobs in Germany? Doesn't anybody understand that more direct flights to Canada creates jobs in Canada (airports, baggage, fuel, customer service, catering…and the list goes on). AIr Canada must have some unreal leverage over Baird to get the wool that far down past the eyes

  4. You state it so correctly!! It IS unfair to have a competitor so heavily subsidized by a government. That's why Air Canada has paid all of the "stabilization financing" back!

  5. Just a question for all the CPC bashers who wish to make hay on this. What do you think UAE's business plan was in buying 90 of the world's largest commercial jets, with limited landing rights and trebling (at least) of their load capacity?

    I'd say blackmailing nations like Canada for landing rights would have been high on the list. Then poaching customers on ACs long haul, high profit routes and forcing them to reduce service both internationaly and nationaly.

    They thought we were bluffing. I understand tit for tat is counter productive, but we should wait till their high season and cancel their Canadian landing rights.

    • The tale of peter or "how not to do politics"

    • Where exactly is all the capacity that the UAE was going to go after hidingi? Forget the Canadian position listen to the EU airlines (and Airbus) who are also being blackmailed. The UAE forget that the corruption of that region cannot be transposed to west that easily.

  6. Just a question for all the CPC bashers who wish to make hay on this. What do you think UAE's business plan was in buying 90 of the world's largest commercial jets, with limited landing rights and trebling (at least) of their load capacity?

    I'd say blackmailing nations like Canada for landing rights would have been high on the list. Then poaching customers on ACs long haul, high profit routes and forcing them to reduce service both internationaly and nationaly.

    They thought we were bluffing. I understand tit for tat is counter productive, but we should wait till their high season and cancel their Canadian landing rights.

  7. The tale of peter or "how not to do politics"

  8. Good for the government for playing hardball.

  9. Good for the government for playing hardball.

  10. I have read several articles and seen several documentaries, not to mention posted videos, on how dirtily business is conducted in Dubai. Seems like the government there conducts politics in the same manner. I am happy that the government did not kowtow to the UAE, who by the way are supposed to be fighting terrorism as well.

  11. I have read several articles and seen several documentaries, not to mention posted videos, on how dirtily business is conducted in Dubai. Seems like the government there conducts politics in the same manner. I am happy that the government did not kowtow to the UAE, who by the way are supposed to be fighting terrorism as well.

  12. What the Canadian Government is really protecting is the high tax load it imposes on Canadian air travelers. If Canadian air carriers enjoyed the same level of support and low taxes as Dubai extends to it's carriers companies like Air Canada would not fear Emirates. High Canadian taxes on air travel is what the Conservatives are defending here.

    • That doesn't make sense. The CPC is maintaining the current tax and fee structure because it recoups from the people that actually use the service the true cost of maintaining this transportation infrastructure.

      I can't grasp, from your post what the gist of your objection is. When you say "High Canadian taxes… defending here.", what are you getting at? It seems like you are damning the current tax structure strictly on the basis that the taxes are, as you suggest, high, as if you were using some simplistic formula: "High taxes, bad. Baaaad!" grunted the caveman.

      Let me explain why I think you are wrong headed on this. First of all, in Dubai, their entire economic model is based upon air travel. Think about it. How would it be even remotely reasonable to do business in Dubai if you could fly there to do it? Remember, there are less than 1.8 million people that live there, excluding the expats. It isn't anything more than a city state. Hey, there isn't anything wrong with that, but lets compair apples to apples. Canada's air transport infrastructure has a heck of a lot more to achieve than servicing one city.

    • So, in Dubai, seeing as almost every business either primarily or secondarily depends on air travel, it makes sense for them to have their single, solitary airport widely supported by the entire tax base. You do know that Emirates and the other airline are heavily subsidized by the UAE gov., no?

      Canada's airline policy is much more enlightened (and appropriate for our conditions). First of all the cost of using the system is borne by those that directly benefit from it's use. Those of us that benefit in a more distant relationship pay for the value of using the system in the cost of our goods. Fair deal to me. Why? Because I don't see any reason why I should be subsidizing your international flights.

    • A final point: Do you think that the Gov of Canada has any responsability to uphold the letter and spirit of the agreements that they have already made? When AC and the other carriers obtain landing spots at an airport, that has a value that contributes to the overall value of the company. At many major airports, almost all of the landing slots are taken up. You can't just pull landing spots out of thin air. It would be entirely reasonable to assume that you might have to take away from one to give to another. Certainly, adding more landings, if it is possible, would be diluting the value of the landing rights that already exist. There also needs to be some thought as to whether or not there is any actual need.

      Maybe the UAE doesn't realize this (doubtful as Emirates is managed almost entirely by expats from Western airlines). Maybe they don't care (then why should we?).

  13. What the Canadian Government is really protecting is the high tax load it imposes on Canadian air travelers. If Canadian air carriers enjoyed the same level of support and low taxes as Dubai extends to it's carriers companies like Air Canada would not fear Emirates. High Canadian taxes on air travel is what the Conservatives are defending here.

  14. I agree, the Canadian gov't should cancel the remaining 3 flights that Emirates flies into Toronto.

    This was a very good strategic move on the part of the C gov't – more flights from Emirates would NOT have created more jobs in Canada. Don't be fooled. There would be far more job losses at both Air Canada and all the businesses supporting Air Canada. There is a lot more strategic business at play here than is obvious on the surface. Anyhow it boils down to a made in Canada solution, which was the right solution.

  15. I agree, the Canadian gov't should cancel the remaining 3 flights that Emirates flies into Toronto.

    This was a very good strategic move on the part of the C gov't – more flights from Emirates would NOT have created more jobs in Canada. Don't be fooled. There would be far more job losses at both Air Canada and all the businesses supporting Air Canada. There is a lot more strategic business at play here than is obvious on the surface. Anyhow it boils down to a made in Canada solution, which was the right solution.

  16. You might just see that happen as Canada just signed up with Qatar for 3 flights a week into Toronto. Plot thickens. http://www.montrealgazette.com/news/Qatar+Canada+

    Here is some of your 'strategic business' – tough call – good old global economy. They must not be ordering anything from Bombardier, lol. http://gulfnews.com/business/aviation/growth-conc

    Here is the complete link from my earlier post. http://gulfnews.com/news/gulf/uae/general/emirate

  17. A loan from the lender of last resort (government), to a debtor with a higher probability of default, with attractive financing terms that would be unavailable in the marketplace? Is a subsidy.

  18. Have you ever flown Emirates? Their service is simply better. Air Canada can't match that level of service. Should consumers not get the best? Yes, they should. Protecting Air Canada just turns it into the third rate airline that it is and risks making it as bad as Air India.
    Increasing flights only increases the number of jobs. It does not reduce the number of jobs. There is a risk that Air Canada might go under. But, that's what happens to lousy, arrogant companies. It is not the duty of Canadians to protect and prop up bad companies.
    We want the best. We should get the best. As an airline, Emirates is better than AC.
    The Dubai airport sucks. But that is another story.

    • It is called a loss leader. Emirates is just a gussied up bus service to take you to the casino. Get a grip. You can't just pop an airline out of a pustule. It is a very capital intensive, low margin business. AC gets the support it does because more is expected of it than any other type of business. In some circumstances, it functions more like a utility.
      If international competition, by which I mean one nation's subsidized carrier poaching from another nation's subsidized carrier, forces AC under, there would be many places that would be soarly underserviced as a result, because the carriers left standing would not want to take on the business.

      But hey, what do you care, as long as you get to the casino. I know, I know. You want the best. You can always get your buddies together and charater Emirates to fly you where you want to go.

      • Excellent, logical review of the situation. Thanks.

      • If international competition, by which I mean one nation's subsidized carrier poaching from another nation's subsidized carrier, forces AC under, there would be many places that would be soarly (sic) underserviced as a result, because the carriers left standing would not want to take on the business.

        If "the business" is such a pathetic money-loser, well, the sentence finishes itself.

        And, your words, a wee bit earlier: Because I don't see any reason why I should be subsidizing your international flights.

        Super. So why are you all in favour of subsidized flights now?

        • I didn't say that is a pathetic money-loser. I said it is a capital intensive, low margin business, that also serves some destinations in Canada that would not otherwise get service (that is the GoC purchasing services in the market in furtherence of it's governing objectives, ie NOT a negative value subsidy).

          As to your "And, your words, a wee.." comment: Canada is a very large country. I bet you didn't know that. A very large percentage of the travel between major centres in Canada is by air. AC and Westjet are the main providers of service in those areas. It would be a very substantial loss for the majority of Canadians that use domestic air travel if the GoC were to allow other heavily subsidized carriers to cherry pick the business, because the "business" is providing air transportation to all major centres in Canada, not air transportation to one or two places you think you can make a buck on with out too much effort.

          • When it comes to international routes, you have all kinds of options, you know, a more competative market. So, yes, I am all for protecting the rights and structure AC has developed over the years, against the too narrowly defined interests of the few people that fly to Dubai regularly.

          • That doesn't make sense. If WJ can compete on domestic routes, it means we don't need to protect international routes in order to make domestic air travel a viable enterprise.

          • Sure it makes sense, YYZ, because WestJet doesn't really compete, it only has to make itself look better than AC. For reasons, much like it is in the banking industry for Canada, there is limited competition. I call it a duopoly. This system actually allows us to limit the amount of subsidies that any and or all levels of government need to put towards AC or WestJet. I don't really think of them as subsidies, but that is another matter. It is my opinion that BOTH WestJet and AC would not be able to "compete" in the (completly not) free market because other carriers, benefiting from much large economies of scale, would poach the valuable runs from both, bankrupting them. The fact of the matter is that all carriers enjoy a degree of protection through the process of negotiated landing rights. So this idea that airlines would somehow thrive in a deregulated environment is, I think, false.

            Hey, if you want to propose that we stop having things like our own airlines and other kinds of industires and companies, switching us fully and completely into a branch-plant nation, feel free to make your case.

      • Emirates: 105 destinations, 1 national hub
        AC: 178 destinations, 1 national hub

        UAE is the only major hub in the middle east serving onward destinations in the east and elsewhere. Hence, Emirates can not be designated a loss leader. If Emirates is a loss leader, then so is AC for wanting to fly people into and out of Canada.

        Don't get me wrong. I'm Canadian too. I would love nothing more than to see a world-class Canadian airline. But not at the expense of the taxpayer. Even if we were to argue that the nation has to bear the expense of a top quality airline, I'd be ok with it if we had a top quality airline. Unfortunately, AC isn't. There are numerous reasons why. And one of the major reasons is national protection at the expense of the public. This protectionism is the reason for AC's lower service quality. They feel safe. They have no competition. No reason to improve. They gouge the very public that is forced into supporting them, their unions and what have you not. You might argue that Emirates is govt owned. Yes, it is. But not at the expense of public taxes.

        • continued:

          All I am saying is that we shot ourselves in the foot by flatly refusing a few extra flights instead of coming to a better conclusion diplomatically. Now, not only are we footing the bill for AC's smugness, but also for moving the military and… slap in the face – we need visas to the UAE. The loss of visas will translate into reduced business dealings. There also is the danger of visa fallouts with other countries who might be emboldended by this. In a world travelling toward openess, we should not be moving in the other direction.

          And all for what? To save a third-rate AC? And that is extereme. Because even with a few extra UAE flights, AC would have survived and improved.

          • We shot ourselves in the foot? If someone is holding a gun to your head, you manage to get the gun away from your head, but in so doing the gun goes off and you get shot in the foot, is that your fault?

            You have a serious case of Stockholm syndrome, ACemp1.

          • As to your desire to get a better grade of airline, you will be happy to know that the upshot of all this is that Qatar Air will now be flying to Toronto, and it is considered to be a better airline than Emirates.

    • AC emp — You miss the point, in fact several points. You are young and understand very little of Canada's aviation history and the part TCA/AC played in it. You clearly cannot envision Canada without Air Canada and the problems that would create for Canadians.

      The UAE is a collection of fiefdoms under Arab Rulers. They are not democracies. Without their oil revenues they have nothing to offer. Their civil right are terrible including imprisoning and torture of Westerners including Canadians. About 60-70% of their population are paid expatriates from the West, India, Phillipines etc. If the West hadn't sacrificed lives Saddam or Iran would own their oil and Emirates Airlines & Etihad wouldn't exist. These fiefdoms are powerless against their Arab neighbours and they need the West to protect them. Canada should shut them out.

    • Ah my friend you haven't been to the new terminal then!

  19. Have you ever flown Emirates? Their service is simply better. Air Canada can't match that level of service. Should consumers not get the best? Yes, they should. Protecting Air Canada just turns it into the third rate airline that it is and risks making it as bad as Air India.
    Increasing flights only increases the number of jobs. It does not reduce the number of jobs. There is a risk that Air Canada might go under. But, that's what happens to lousy, arrogant companies. It is not the duty of Canadians to protect and prop up bad companies.
    We want the best. We should get the best. As an airline, Emirates is better than AC.
    The Dubai airport sucks. But that is another story.

  20. That doesn't make sense. The CPC is maintaining the current tax and fee structure because it recoups from the people that actually use the service the true cost of maintaining this transportation infrastructure.

    I can't grasp, from your post what the gist of your objection is. When you say "High Canadian taxes… defending here.", what are you getting at? It seems like you are damning the current tax structure strictly on the basis that the taxes are, as you suggest, high, as if you were using some simplistic formula: "High taxes, bad. Baaaad!" grunted the caveman.

    Let me explain why I think you are wrong headed on this. First of all, in Dubai, their entire economic model is based upon air travel. Think about it. How would it be even remotely reasonable to do business in Dubai if you could fly there to do it? Remember, there are less than 1.8 million people that live there, excluding the expats. It isn't anything more than a city state. Hey, there isn't anything wrong with that, but lets compair apples to apples. Canada's air transport infrastructure has a heck of a lot more to achieve than servicing one city.

  21. So, in Dubai, seeing as almost every business either primarily or secondarily depends on air travel, it makes sense for them to have their single, solitary airport widely supported by the entire tax base. You do know that Emirates and the other airline are heavily subsidized by the UAE gov., no?

    Canada's airline policy is much more enlightened (and appropriate for our conditions). First of all the cost of using the system is borne by those that directly benefit from it's use. Those of us that benefit in a more distant relationship pay for the value of using the system in the cost of our goods. Fair deal to me. Why? Because I don't see any reason why I should be subsidizing your international flights.

  22. A final point: Do you think that the Gov of Canada has any responsability to uphold the letter and spirit of the agreements that they have already made? When AC and the other carriers obtain landing spots at an airport, that has a value that contributes to the overall value of the company. At many major airports, almost all of the landing slots are taken up. You can't just pull landing spots out of thin air. It would be entirely reasonable to assume that you might have to take away from one to give to another. Certainly, adding more landings, if it is possible, would be diluting the value of the landing rights that already exist. There also needs to be some thought as to whether or not there is any actual need.

    Maybe the UAE doesn't realize this (doubtful as Emirates is managed almost entirely by expats from Western airlines). Maybe they don't care (then why should we?).

  23. It is called a loss leader. Emirates is just a gussied up bus service to take you to the casino. Get a grip. You can't just pop an airline out of a pustule. It is a very capital intensive, low margin business. AC gets the support it does because more is expected of it than any other type of business. In some circumstances, it functions more like a utility.
    If international competition, by which I mean one nation's subsidized carrier poaching from another nation's subsidized carrier, forces AC under, there would be many places that would be soarly underserviced as a result, because the carriers left standing would not want to take on the business.

    But hey, what do you care, as long as you get to the casino. I know, I know. You want the best. You can always get your buddies together and charater Emirates to fly you where you want to go.

  24. Excellent, logical review of the situation. Thanks.

  25. Were you aware that the Gov of Canada purchases goods and services in the market place? It is true. What you call a subsidy (and it would appear that any thing MYL calls a subsidy is a) bad & b) unfair) is in fact the GoC purchasing services to further their raison d'etre: governing. There are a great number of businesses that would chuck free market principles (as if they ever held them) under the bus should the GoC stop purchasing goods and services.

    Doesn't it make sense for the GoC to use it's capacity as lender of last resort if failing to do so would mean a serious impediment to its governance objectives? If it were up to you, you'd let any accidental/intentional distortion in markets destroy the labour and investment of companies, chalking it up as a bizare confirmation of your quasi-economic eugenics. Nice in (your) theoretical world, but not sound governing praxis.

  26. You do get that black-pot Air Canada was whining about black-kettle Emirates Air being subsidized, don't you? Well, actually, maybe you don't. So there you go. Maybe you'll get it now.

  27. If international competition, by which I mean one nation's subsidized carrier poaching from another nation's subsidized carrier, forces AC under, there would be many places that would be soarly (sic) underserviced as a result, because the carriers left standing would not want to take on the business.

    If "the business" is such a pathetic money-loser, well, the sentence finishes itself.

    And, your words, a wee bit earlier: Because I don't see any reason why I should be subsidizing your international flights.

    Super. So why are you all in favour of subsidized flights now?

  28. is in fact the GoC purchasing services to further their raison d'etre: governing.

    Ah! So that's why we're digging holes and filling them back up again.

    Were YOU aware that government purchasing goods and services to honour its constitutional responsibilities (that governing thing) is rather different from showering the marketplace with pork, or competing with other lending institutions in the marketplace by undercutting them on price (interest rates) for the higher risk creditors?

  29. Emirates: 105 destinations, 1 national hub
    AC: 178 destinations, 1 national hub

    UAE is the only major hub in the middle east serving onward destinations in the east and elsewhere. Hence, Emirates can not be designated a loss leader. If Emirates is a loss leader, then so is AC for wanting to fly people into and out of Canada.

    Don't get me wrong. I'm Canadian too. I would love nothing more than to see a world-class Canadian airline. But not at the expense of the taxpayer. Even if we were to argue that the nation has to bear the expense of a top quality airline, I'd be ok with it if we had a top quality airline. Unfortunately, AC isn't. There are numerous reasons why. And one of the major reasons is national protection at the expense of the public. This protectionism is the reason for AC's lower service quality. They feel safe. They have no competition. No reason to improve. They gouge the very public that is forced into supporting them, their unions and what have you not. You might argue that Emirates is govt owned. Yes, it is. But not at the expense of public taxes.

  30. continued:

    All I am saying is that we shot ourselves in the foot by flatly refusing a few extra flights instead of coming to a better conclusion diplomatically. Now, not only are we footing the bill for AC's smugness, but also for moving the military and… slap in the face – we need visas to the UAE. The loss of visas will translate into reduced business dealings. There also is the danger of visa fallouts with other countries who might be emboldended by this. In a world travelling toward openess, we should not be moving in the other direction.

    And all for what? To save a third-rate AC? And that is extereme. Because even with a few extra UAE flights, AC would have survived and improved.

  31. I am well aware of what is going on. The difference is that you are calling far too many things subsidies and every time you utter the word "subsidized" it is as a pejorative. Poor service levels or no, see no reason to sacrifice AC over the lack of a loan.

  32. If the government has a recognized capacity as lender of last resort, does that not suggest that it is a market participant? It does to me.

    You can't be undercutting someone on price when you (GoC) is the only one making offerings for the business. Businesses, with a fair degree of regularity, make use of the restructuring system. I fail to see why you have such a problem with this fact. It really looks like an ideological blindspot.

  33. When it comes to international routes, you have all kinds of options, you know, a more competative market. So, yes, I am all for protecting the rights and structure AC has developed over the years, against the too narrowly defined interests of the few people that fly to Dubai regularly.

  34. I didn't say that is a pathetic money-loser. I said it is a capital intensive, low margin business, that also serves some destinations in Canada that would not otherwise get service (that is the GoC purchasing services in the market in furtherence of it's governing objectives, ie NOT a negative value subsidy).

    As to your "And, your words, a wee.." comment: Canada is a very large country. I bet you didn't know that. A very large percentage of the travel between major centres in Canada is by air. AC and Westjet are the main providers of service in those areas. It would be a very substantial loss for the majority of Canadians that use domestic air travel if the GoC were to allow other heavily subsidized carriers to cherry pick the business, because the "business" is providing air transportation to all major centres in Canada, not air transportation to one or two places you think you can make a buck on with out too much effort.

  35. As a sick puppy, AC should be subjected to higher interest rates when it borrows. There may have been lenders willing to assume the risk and sign a deal at a higher rate. The government distorted the market by assuming that risk for free, and offering a lower rate (or, for all I know, no interest rate at all). Ergo, subsidy. It's just a straight-up definition. Failing to recognize this as a subsidy is the marker of an ideological blindspot. I hope your vision is improving.

  36. They could have found a loan. But they fell in love with an undeserved lower interest rate courtesy of the present and future taxpayers of Canada.

  37. I am grateful for your concern after my health. Rest assured that, through a judicious combination of public and private expenditure, I find myself in robust good health.

    On another point of curiosity, you do not by chance, sell used autos for a living, do you? If AC was already facing, for reasons neither you or I full comprehend, a cash flow crunch, then how would getting financing at a rate, presumably, higher than what they are already paying make any sense?

  38. We shot ourselves in the foot? If someone is holding a gun to your head, you manage to get the gun away from your head, but in so doing the gun goes off and you get shot in the foot, is that your fault?

    You have a serious case of Stockholm syndrome, ACemp1.

  39. As to your desire to get a better grade of airline, you will be happy to know that the upshot of all this is that Qatar Air will now be flying to Toronto, and it is considered to be a better airline than Emirates.

  40. Capitalism 101, because it seems just about everybody needs a remedial tutorial around here:

    Business in tight spot? Options include: (A) take on more debt, at a well-deserved higher interest rate given the inherent risks, and try to turn things around; (B) issue more shares, diluting the equity of current shareholders, but enjoying some extra capital to try to turn things around; (C) sell off non-core assets to obtain a little breathing room in the debt column, and try to turn things around;

  41. (D) re-negotiate current debt (e.g. "sixty-five cents on the dollar") to an agreement acceptable to nervous creditors who might otherwise get squat, then try to turn things around; (E) read the writing on the wall, see there is no hope, and wind down operations, selling off the business in whole or the assets bit-by-bit, to the benefit of creditors according to the priority established in law (which, I believe, is shareholders last in line). There are certainly others, including converting creditors into shareholders, which erases some debt and dilutes equity, and bankruptcy court, which seeks to keep the company afloat under responsible supervision, and imposes some combination of measures described above. These are the sort of acceptable punishments laggard companies and their executives and ownersshould face when they have screwed up.

  42. But no. Let's reward these losers instead with heaps of cheap cash, courtesy of the taxpayers, including those businesses whose actual success has just been punished through taxation in order to prop up the loser competition. This, some of us like to call "sound governing." Blech.

  43. Statesmanship Graduate level, because it seems you have only one way of looking at things, when a comprehensive view is needed.

    Duopoly in a tight spot? Options include: A) run it like the utility that it is meant to be b) ignore those harpies that attempt to apply the wholely inappropriate model of "free" enterprise c) suck up the loss because it was previous government actions, having fallen prey to the siren song of deregulation, that got the (previously) state carrier into it's current straights in the first place and caused the other, Canadian Airlines, to go under. D) recognized that in the current environment of massive subsidies across the board to all carriers, you can't let a little thing like a trade dispute with a minor principality be sufficient reason to throw all your other work out the window.

    You've got to think like a statesman. What kinds of costs will Canadians and Canadian business and industries be facing without AC, given that there is no readily available replacement? Is that cost greater than taking on the somewhat high risk of making a loan to AC? Ya, now you know why the loan was made.

  44. I'm a big fan of that UAE advertisement. It just screams:

    UAE: Sure we're embracing diversity, but don't worry, a man will still be flying the plane.

  45. See, you are still limiting your vision. Open the skies. If Aloha Airways would like to take a run at Toronto-Vancouver-Honolulu, and is willing to pay true cost for landing rights and gates like every other airlines, so be it – we now have another choice for Pearson-to-YVR. It is government meddling that has led to your "duopoly" in the first place. And deregulation did not "cause" Canadian Airlines to go under. It, rather, ended the propping up of a failed business once it was required to compete.

    A "national civilian air carrier" as a utility? Nope. Not even close. And, don't worry, I have given up convincing good ol' pragmatic ColdStanding of these truths. But I do hope this conversation (for which I thank you) might offer others a chance to consider the thoughts carefully.

  46. It would hardly be an interesting conversation if I agreed with you.

  47. I am glad to see an article that covers more than AC bashing for not having great service. I have been surprised by the growth over the years of international flights from smaller centers in Canada. This gives more options for fliers. At the same time, it is often easier to get seats on these flights using points, because they do not have as much demand as some of the flights out of the main hubs like TO. I flew YHZ to LHR last summer. There were lots of people upgraded into Biz from what I can tell. This tells me that these routes may be a bit more marginal.

    I could see large numbers of Emirates flights diverting people off of the other flights (not just AC flights), which fly to destinations where people want to go, which might cause some of those flight to be dropped. We may end up with fewer choices and more inconvenience. Dubai is not a destination for most people.

  48. I am glad to see an article that covers more than AC bashing for not having great service. I have been surprised by the growth over the years of international flights from smaller centers in Canada. This gives more options for fliers. At the same time, it is often easier to get seats on these flights using points, because they do not have as much demand as some of the flights out of the main hubs like TO. I flew YHZ to LHR last summer. There were lots of people upgraded into Biz from what I can tell. This tells me that these routes may be a bit more marginal.

    I could see large numbers of Emirates flights diverting people off of the other flights (not just AC flights), which fly to destinations where people want to go, which might cause some of those flight to be dropped. We may end up with fewer choices and more inconvenience. Dubai is not a destination for most people.

  49. People say that service on Emirates is better. If you read some of the frequent flyer boards, you might hear a slightly different story. When IRROPs occur (mechanicals, weather delays, etc.), passengers are kind of given the shaft. North American airlines treat their passengers pretty well in those circumstances, considering everything.

  50. People say that service on Emirates is better. If you read some of the frequent flyer boards, you might hear a slightly different story. When IRROPs occur (mechanicals, weather delays, etc.), passengers are kind of given the shaft. North American airlines treat their passengers pretty well in those circumstances, considering everything.

  51. AC emp — You miss the point, in fact several points. You are young and understand very little of Canada's aviation history and the part TCA/AC played in it. You clearly cannot envision Canada without Air Canada and the problems that would create for Canadians.

    The UAE is a collection of fiefdoms under Arab Rulers. They are not democracies. Without their oil revenues they have nothing to offer. Their civil right are terrible including imprisoning and torture of Westerners including Canadians. About 60-70% of their population are paid expatriates from the West, India, Phillipines etc. If the West hadn't sacrificed lives Saddam or Iran would own their oil and Emirates Airlines & Etihad wouldn't exist. These fiefdoms are powerless against their Arab neighbours and they need the West to protect them. Canada should shut them out.

  52. Canada is going in the wrong direction with the 'protectionist' attitude it has shown with AC and Potash.

    Have you ever flown AC international ? Their service sucks. Emirates is rated one of the best airlines in the world. What message are we sending to the international business community with such actions ?

    Perhaps AC needs to look at how it can get more competitive – better service would be a good start !

  53. Canada is going in the wrong direction with the 'protectionist' attitude it has shown with AC and Potash.

    Have you ever flown AC international ? Their service sucks. Emirates is rated one of the best airlines in the world. What message are we sending to the international business community with such actions ?

    Perhaps AC needs to look at how it can get more competitive – better service would be a good start !

  54. “We feel the rights under the current agreement meet the current demand,” says Transport spokesperson Patrick Charette.

    … it's not up to a bureaucrat to decide what supply is required to meet demand.

    • Fates protect us if it's left up to a cabinet minister, though.

  55. “We feel the rights under the current agreement meet the current demand,” says Transport spokesperson Patrick Charette.

    … it's not up to a bureaucrat to decide what supply is required to meet demand.

  56. Ah my friend you haven't been to the new terminal then!

  57. That doesn't make sense. If WJ can compete on domestic routes, it means we don't need to protect international routes in order to make domestic air travel a viable enterprise.

  58. Sure it makes sense, YYZ, because WestJet doesn't really compete, it only has to make itself look better than AC. For reasons, much like it is in the banking industry for Canada, there is limited competition. I call it a duopoly. This system actually allows us to limit the amount of subsidies that any and or all levels of government need to put towards AC or WestJet. I don't really think of them as subsidies, but that is another matter. It is my opinion that BOTH WestJet and AC would not be able to "compete" in the (completly not) free market because other carriers, benefiting from much large economies of scale, would poach the valuable runs from both, bankrupting them. The fact of the matter is that all carriers enjoy a degree of protection through the process of negotiated landing rights. So this idea that airlines would somehow thrive in a deregulated environment is, I think, false.

    Hey, if you want to propose that we stop having things like our own airlines and other kinds of industires and companies, switching us fully and completely into a branch-plant nation, feel free to make your case.

  59. The loan was fully secured and the rate was over 13% so the government did quite well on this. The real reason Air Canada is in bad shape is the pension overhang from the forced merger with Canadian Airlines thanks to Collinette and the LIberal party.

  60. On a flight from Toronto to Montreal the fare is 89 dollars. The fees on the passenger are $69.23. With the 89 dollars revenue Air Canada then has to pay over 550 different types of taxes, landing fees, Nav Canada fees, jet fuel taxes, real estate etc.
    Given the size of this country an integrated Airline is required which West Jet is not.
    Further the problem at Air Canada goes back to the government bailing out Canadian Airlines 3 times prior to it's failure in 1999 thus destroying the margins at Air Canada. Once CAIL finally failed the government forced a merger. Leaving Air Canada to pay the pensions for two legacy airlines while promptly shrinking back to its original size. So the government finances an over capacity in the market for 14 years and then dumps the resultant employee costs on Air Canada. Air Canada's problems are all about government policy.

  61. On a flight from Toronto to Montreal the fare is 89 dollars. The fees on the passenger are $69.23. With the 89 dollars revenue Air Canada then has to pay over 550 different types of taxes, landing fees, Nav Canada fees, jet fuel taxes, real estate etc.
    Given the size of this country an integrated Airline is required which West Jet is not.
    Further the problem at Air Canada goes back to the government bailing out Canadian Airlines 3 times prior to it's failure in 1999 thus destroying the margins at Air Canada. Once CAIL finally failed the government forced a merger. Leaving Air Canada to pay the pensions for two legacy airlines while promptly shrinking back to its original size. So the government finances an over capacity in the market for 14 years and then dumps the resultant employee costs on Air Canada. Air Canada's problems are all about government policy.

  62. Some may remember Ward Air, whose service was, in my view was the best. Given a choice I would fly Westjet over Air Canada anytime

  63. Where exactly is all the capacity that the UAE was going to go after hidingi? Forget the Canadian position listen to the EU airlines (and Airbus) who are also being blackmailed. The UAE forget that the corruption of that region cannot be transposed to west that easily.

  64. Good article — when this story first hit the airwaves, the details were light.

    Now getting into an Air Canada vs Emirates debates is pointless — I would just point out that, when it comes to developing a nation's international standing, in tourism and commerce, Dubai is doing a pretty good job these days.

    They've obviously got a plan. (love it or lump it)

  65. Good article — when this story first hit the airwaves, the details were light.

    Now getting into an Air Canada vs Emirates debates is pointless — I would just point out that, when it comes to developing a nation's international standing, in tourism and commerce, Dubai is doing a pretty good job these days.

    They've obviously got a plan. (love it or lump it)

  66. Fates protect us if it's left up to a cabinet minister, though.

  67. Yes AC has legacy costs, air taxes are too high, Dubai's negotiating tactics stink, but AC needs to start upping its game. It did the same thing to Singapore Airlines (best airline in the world) when it wanted to increase flight frequency to Vancovuer to daily service. AC won and SA left Canada. Emirates requests weren't that onerous and overall employment to Canada would have been neutral. Yes Emirates got help from its Government but so does AC (bailouts, protectionism). from a supposedly a pro free market. And even otherwise, get used to it Canada. If another soveriegn nation chooses to fund key industries and they do well — maybe we should be thinking about it? What gives us the right to say that "oh we don't believe in funding the private sector" so everybody else better use the same economic system or we won't let them into our county. AC, and Canada, need to compete in the current economic context. The Government should never allow AC to call the shots again. Each time they do, the service on AC will just get lousier from lack of competition!

  68. Yes AC has legacy costs, air taxes are too high, Dubai's negotiating tactics stink, but AC needs to start upping its game. It did the same thing to Singapore Airlines (best airline in the world) when it wanted to increase flight frequency to Vancovuer to daily service. AC won and SA left Canada. Emirates requests weren't that onerous and overall employment to Canada would have been neutral. Yes Emirates got help from its Government but so does AC (bailouts, protectionism). from a supposedly a pro free market. And even otherwise, get used to it Canada. If another soveriegn nation chooses to fund key industries and they do well — maybe we should be thinking about it? What gives us the right to say that "oh we don't believe in funding the private sector" so everybody else better use the same economic system or we won't let them into our county. AC, and Canada, need to compete in the current economic context. The Government should never allow AC to call the shots again. Each time they do, the service on AC will just get lousier from lack of competition!

  69. Emirates is like every other business in the UAE, locusts sucking the business out of Canada and the US. Screwed on oil, screwed on competion and leaving the unemployed in Canada ! Global Economy you say, it's too late now, but total rubbish! Canadian are to be used like the Indian Wallas in Dubai, virtual slaves!

  70. Emirates is like every other business in the UAE, locusts sucking the business out of Canada and the US. Screwed on oil, screwed on competion and leaving the unemployed in Canada ! Global Economy you say, it's too late now, but total rubbish! Canadian are to be used like the Indian Wallas in Dubai, virtual slaves!

  71. Regardless, Air Canada CEO Calin Rovinescu commended Ottawa's “backbone” for standing up to the U.A.E., arguing in a speech last week that Canada should only sign open skies agreements with countries where there is significant two-way travel.

    Canada should only open Open Skies agreements with countries with significant 2-way travel. Well then what about New Zealand (population 4.4 million), and Iceland (population 300,000) whom Canada signed Open or "quasi" Open agreements with?

    Isn't it great how bureaucrats can deem how much is adequate capacity. Wouldn't it be great if the executives at RIM could say that there were enough Blackberries in Canada and there should be no need for Iphone 4s to enter the market.

  72. Regardless, Air Canada CEO Calin Rovinescu commended Ottawa's “backbone” for standing up to the U.A.E., arguing in a speech last week that Canada should only sign open skies agreements with countries where there is significant two-way travel.

    Canada should only open Open Skies agreements with countries with significant 2-way travel. Well then what about New Zealand (population 4.4 million), and Iceland (population 300,000) whom Canada signed Open or "quasi" Open agreements with?

    Isn't it great how bureaucrats can deem how much is adequate capacity. Wouldn't it be great if the executives at RIM could say that there were enough Blackberries in Canada and there should be no need for Iphone 4s to enter the market.

  73. The Canadian government has funded failed private car companies with public money. How can we complain about other governments funding a successful business like Emirates? My family and I have flown both Air Canada as well as Emirates, among a host of other airlines. Without a doubt Emirates has always had a pleasant and more caring service. Forget about politics, as a consumer, I want to have access to cheaper and better services.

  74. The Canadian government has funded failed private car companies with public money. How can we complain about other governments funding a successful business like Emirates? My family and I have flown both Air Canada as well as Emirates, among a host of other airlines. Without a doubt Emirates has always had a pleasant and more caring service. Forget about politics, as a consumer, I want to have access to cheaper and better services.

  75. The UAE is bankrupt, bailed out by Abu Dhabi to the tune of over $100 Billion, soon to be followed by their state owned airline Emirates Air when they can't fill their 90 A380's that they've foolishly ordered.

  76. The UAE is bankrupt, bailed out by Abu Dhabi to the tune of over $100 Billion, soon to be followed by their state owned airline Emirates Air when they can't fill their 90 A380's that they've foolishly ordered.

  77. retarded.

    Flights from Seattle to London, for example, are up to 50% cheaper than Vancouver/London flights (essentially same trip).

    Check Kayak.com….$900 vs $1350 for Jan 2-9, 2011 flights.

    This is the result of retarded legislation, regulation and protectionism.

    Get over it. You're all paying more as a result.

  78. retarded.

    Flights from Seattle to London, for example, are up to 50% cheaper than Vancouver/London flights (essentially same trip).

    Check Kayak.com….$900 vs $1350 for Jan 2-9, 2011 flights.

    This is the result of retarded legislation, regulation and protectionism.

    Get over it. You're all paying more as a result.

  79. I think the right to protect organizations and national carriers is a right of every country, but my concern is that we should be more focused on making Air Canada more cost effective. After all we cannot stop people from crossing border to US and taking flights from there. I personally have an experience and went to Buffalo to take flight. The guy at the parking counter told me that about 70% cars parked in the Buffalo Airport Parking are from Canada. So my point is Darwins theory "Survival of the fittest". If AC is not smart enough it should and would lose business.

  80. I think the right to protect organizations and national carriers is a right of every country, but my concern is that we should be more focused on making Air Canada more cost effective. After all we cannot stop people from crossing border to US and taking flights from there. I personally have an experience and went to Buffalo to take flight. The guy at the parking counter told me that about 70% cars parked in the Buffalo Airport Parking are from Canada. So my point is Darwins theory "Survival of the fittest". If AC is not smart enough it should and would lose business.

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