This week's travel news - Macleans.ca
 

This week’s travel news

The Volcano Is Resting…Here Come The Hurricanes, Canadian Passports Going Digital, and Where Is WestJet Going Next?


 

The Volcano Is Resting…Here Come The Hurricanes
Now that the Iceland volcano has quit smoking – at least for now – travel industry fears are focusing on the 2010 Atlantic hurricane season, and the news isn’t good. According to Reuters, leading U.S. forecasters are now predicting 18 named tropical storms and 10 hurricanes, five of them major, with a 76% likelihood that a major hurricane will hit the U.S. coastline during the season that extends from June 1 through November 30. Travelling during hurricane season has risks and rewards. The vast majority of visitors won’t even have a sniff of a major storm. Prices are lower too, so it comes down to a personal risk/benefit analysis. But even in a very active hurricane season, you shouldn’t write off the region when planning a winter holiday after November. By then, most storms are just memories discussed over dominoes in the rum shop.

Canadian Passports Going Digital
As of 2012, Canadian passports will have an invisible microchip embedded in the back cover. The chip will store the same personal information now found on page 2 of our passports, along with a digital copy of the passport photo suitable for use by facial recognition software. As reported on TakeOffeh, the proposed new ePassport will have a shelf life of 10 years as opposed to the current five, though children’s passports will have an earlier expiry date. Canada isn’t on the leading edge of this effort — 70 countries, including the EU, are already issuing their own versions of ePassports, with some featuring fingerprints and iris scans as well as digital photos. According to the Association of Canadian Travel Agencies, which recently attended a Passport Canada event, one of the major reasons we’re lagging behind on this effort is a lack of funding for Passport Canada. While it is a government agency, Passport Canada operates on a cost-recovery model and receives no funding from the government. Some of the benefits of an ePassport include increased security, less risk of identity theft and a lower chance of forgery or alteration.

Where Is WestJet Going Next?
Since the appointment of Gregg Saretsky as WestJet CEO, speculation has grown about whether the airline has greater ambitions than sticking to its low-cost, North America-focused roots. Their declared intention of becoming one of the world’s top five airlines by 2016 feeds rumours of planned expansion beyond North America. The once-underdog airline with the positive public image has set its sights on taking on Air Canada. It’s doing a good job of that in the Canadian domestic market, but wants to take the challenge a step further, with plans to double its share of the trans-border market to over 25% within six years. WestJet also recently announced a codeshare deal with Hong Kong’s Cathay Pacific Airways and said a partnership with a U.S. carrier is imminent – which is rumoured to be Delta. Airline consultant Rick Erickson believes this aggressive alliance strategy could be a case of testing the waters before operating its own overseas flights. That’s how it got into packaged holidays: in 2003, it entered into a partnership with Transat that saw WestJet fly charter flights to destinations in Mexico and the Caribbean. But, after realizing how profitable selling packaged holidays can be, it launched its own WestJet Vacations business. “I think they’re going to do the same thing in the international arena,” Erickson told Macleans.

But Saretsky poured some cold water on those views this week. Speaking at an annual investor’s day, the CEO pledged to retain the airline’s low-cost, one-type aircraft business model. “We are very much getting back to our focus on costs,” Saretsky said, part of which is continuing to fly a fleet of only Boeing 737 aircraft that keeps costs down but limits how far it can fly. While WestJet’s future plans remain unclear, one thing is for sure: they definitely include becoming a bigger thorn in AC’s side, at least at home and in the competitive U.S./Canada transborder market.

Down In Front: Researcher Says Airlines Need A New Financial Model
Henry Harteveldt of Forrester Research says aging boomers and the growing use of global communications as a replacement for some corporate travel will dramatically alter the airline landscape. Harteveldt told Canadian Press reporter Russ Marowits that legacy carriers like Air Canada need to rethink their heavy reliance on high-paying premium passengers, because there simply won’t be as many of them in future. Evolving communications technology, high-definition video conferencing and corporate restrictions on premium travel could alter the destinations serviced by airlines and the size of the premium cabins, Harteveldt says. He points out that several European carriers have already eliminated first class on some routes. “The airlines really have to figure out who is their core customer and they haven’t been very good at this,” Harteveldt says. In the future, the researcher believes leisure travel will drive aviation growth, as retiring boomers set off to explore the world. Not everyone agrees with Harteveldt’s take, including a spokesperson for Air Canada. “Our own experience is that people like and need to travel for business and, as the world economy continues to globalize, we expect this will not change,” said Peter Fitzpatrick. That may be true, but the question remains as to whether employers (and shareholders) will be willing to pay premium fares as much as 10 times as high as economy prices.

By: Bruce Parkinson
Bruce Parkinson is a travel industry journalist and regular contributor to Takeoffeh.com as well as sister company, OpenJaw.com

Photo Credits: ppt.gc.ca, westjet.com


 

This week’s travel news

  1. The only possibility for intercontinental travel by WJA is at the Charter end. It is an exaggeration to say that they are a thorne in Air Canada's side. Airline CEOs laugh at any Regional airline's claim to be able to become top 5 or even top 10 in 6 years. It is such an absurd statement that the WJA CEO would never make it himself, but would through a proxy consultant. We've heard all of that before from Wardair, Canada 3000, CAIL and there will be others in the future. It's only noteworthy for those that haven't heard it before.