Toronto Billy Bishop Toronto City Airport | ?m | ?s | Ports Toronto | Arup

sjc said:
Ottawa is a small market, but Ottawa+Toronto+Halifax (via Porter connecting flight) is not. [EDIT: and you will be able wait for your flight in Ottawa in the new Porter lounge]
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If I were starting a new service to Europe would I be better off setting up shop in Toronto and rely on that market and hope to pick up the odd customer who comes in from Ottawa to use my service......

.....or would I be better off setting up in Ottawa even though the market is smaller and hop to cash in on a new alliance with Porter to bring me all of those customers in Toronto who would bypass already existing direct services to come to Ottawa and wait in the Porter lounge for my new service to whisk them to Europe?

I am not an airline exec so I really don't know the answer ;)
 
In Toronto, a new entrant is a small fish in a big pond (lots of competitors). In Ottawa, you have few competitors (if any) besides Air Canada.
 
sjc said:
In Toronto, a new entrant is a small fish in a big pond (lots of competitors). In Ottawa, you have few competitors (if any) besides Air Canada.
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Oh, I get that....do you think there might be a reason there are no competitors? Whenever I think of something I first think "why has no one else done this?".....often (not always) there is a very good reason.
 
Most foreign airlines don't have any way to attract connecting customers in Ottawa. Air Canada could (and likely does to some extent), but their business is set up around feeding people into and out of Toronto.

Ottawa by itself is a relatively small market that is well connected to Toronto. Ottawa passengers are still going to travel internationally, regardless of whether you make them go through Toronto. But if you add up that small market, the small market of downtown Toronto people plus the small market of Halifax (which is also not over-served with Europe flights, and often need to transfer to somewhere anyway), it might add up to quite a few people.

That said, I don't know that any of this needs to be on their short-term schedule. But the airline industry is very fluid, and it can pay to be open to opportunities that come along (like Porter did when Canjet went charter-only and opened up opportunities in Halifax).
 
Air Canada looks to be fighting back.

I'm not sure how long they have had this: Air Canada Rapidair

* New! Free same-day standby for an earlier flight (Tango Plus, Latitude and Executive Class)
* Same-day confirmed changes:
o Complimentary for Latitude and Executive Class Flexible customers
o Only $75 with Tango Plus and Executive Class Lowest fares
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I don't think that they have had free standby for Tango Plus for very long. Given their schedule, that could be useful (36 flights a day to Ottawa and 48 flights a day to Montreal).
 
^ This really shows how Porter needs to tinker with their fares a little and their fare rules a lot. As they expand into other markets, I'd like to see them treat the TOM triangle as a special case. Set Toronto-Ottawa and Toronto-Montreal fares at a 100 bucks and drop the rules. If the do start Ottawa-Montreal service, set it at 50 bucks and similarly drop the rules.

YTZ does offer enough advantages that they don't need to match AC on price or schedule necessarily. With 17 flights a day, it's more than enough coverage. They need to adjust the fare rules to compete.
 
Set Toronto-Ottawa and Toronto-Montreal fares at a 100 bucks and drop the rules.
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They would lose a lot of their premium revenue that way. I rarely get a flight to Ottawa for $100. Usually it is more like $150-180 for the cheapest fare, especially if the flight is within a few days.

A $150 fare is still cheaper for me than an Air Canada $100 fare when I consider the extra taxi costs (about $20 vs $55-60 each way) and looking the next few days out, I see Air Canada is at least $119, up to $209 depending on the flight ($169 being the most common).

That said, lets see if the Westjet passes put any downward pressure on fares. I certainly wouldn't mind paying cheaper prices, but unless they are having trouble filling seats, I don't see Porter dropping their YTZ-YOW fares a lot.

I wouldn't mind if they added free same-day changes though, so if you show up early for your flight, you can take an earlier one. Leave refundability and non-same-day changes to the current scheme.

EDIT: in my case, same day changes usually mean going from a rush hour flight (4pm or 5pm) to a non-peak one (2pm or 3pm), which can't be a bad thing for Porter.
 
^ Good points about same-day changes. What is often forgotten in the comparison between AC and Porter is the lounge and food and beverage service. AC charges you 35 bucks for use of the Maple leaf lounge. Porter charges you nothing. Ditto for the food on the plane and seat selection (on the passes..15 bucks otherwise). Porter basically offers a service level that's equal to AC Tango Plus (60 bucks on top of normal fare for each direction) or Latitude or even AC Executive depending on how you look at it. Taking that into account Porter could easily charge 140 and still have parity. However, given the significant price sensitivity of short haul travel, I'd love to see them keep their fares between 120-150 (depending on the time of day) and about 100 for the pass fares (Firm, say 10 bucks more Flexible and 20 bucks for Freedom).

But you're right. The biggest improvements they could make would be to allow same-day changes for free and to drop the seat selection charges across the board. That would move over all those Tango Plus/Latitude clients over to Porter. They don't have to drop the 7 day rule necessarily for the Firm passes. Just keep the charge less than AC's 75 bucks and give free same day changes to allow for an earlier or later flight.
 
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^ In fairness, not many frequent flyers purchase AC Tango fares. Tango Plus is pretty well the standard for every business traveler I know due to the ability to earn AC status miles. As well, a high percentage of frequent travelers in the triangle are AC elite members, which gives them free lounge access. Compared to a general boarding gate Porter's lounge is great, but it's a long way behind a Maple Leaf Lounge (which has food and alcohol).

As someone who flies to Montreal on business 8-10 times a year, I can tell you the reason I've switched from AC to Porter is two fold: 1) TCCA is far more convenient for me than Pearson and 2) on board, the service and comfort of a Porter flight is far superior to AC economy class. Free standby isn't going to draw me back to AC, nor will fare differences unless Porter's prices were to rise substantially.
 
^ I am skeptical that as many business travelers fly Tango Plus because of status miles. Most large companies and public sector offices use a travel agent who pulls up the cheapest fare. They don't cover lounges or in-flight upgrades. That's why Porter has to stay competitive on price. For this class of traveler Porter is a big step-up.

For the executive traveler or middle manager entitled to small upgrades or business class travel, the plus side is that Porter is not all that much of a step-down. Sure there's no free booze and food (other than short bread cookies) in the Porter lounge. And there's no in-flight entertainment either. But the time savings and travel cost savings (cab fare) in TO more than make up for it. And most aren't all that apt to notice that they've given up AC Executive.

For Porter this makes for a fine balancing act. They compete on price. But their best customers they have to attract with great service that has to be had for a fraction of what Air Canada spends on amenities like the Maple Leaf lounges and in-flight entertainment. All in all though, I'd say Porter has found the balance.
 
kEiThZ said:
^ I am skeptical that as many business travelers fly Tango Plus because of status miles. Most large companies and public sector offices use a travel agent who pulls up the cheapest fare. They don't cover lounges or in-flight upgrades. That's why Porter has to stay competitive on price. For this class of traveler Porter is a big step-up.
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You'd be surprised I think. Not sure about the public sector but most of my peers (banking, accounting, etc.) are allowed to fly T+ as it is usually a marginal price difference a provides a nice benefit for the employee that is stuck on the road all the time. At my company for example, our travel agent can book us in anything up to T+, while Latitude or Exec requires special approval.

For the executive traveler or middle manager entitled to small upgrades or business class travel, the plus side is that Porter is not all that much of a step-down. Sure there's no free booze and food (other than short bread cookies) in the Porter lounge. And there's no in-flight entertainment either. But the time savings and travel cost savings (cab fare) in TO more than make up for it. And most aren't all that apt to notice that they've given up AC Executive.

For Porter this makes for a fine balancing act. They compete on price. But their best customers they have to attract with great service that has to be had for a fraction of what Air Canada spends on amenities like the Maple Leaf lounges and in-flight entertainment. All in all though, I'd say Porter has found the balance.
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Agreed, they are doing a fine job. I am sacrificing free MLL access, in-flight entertainment, the occasional upgrade to exec, and 10 status segments/5000 miles by choosing Porter this year, but I haven't had a second thought about it. They need to compete on price to a certain level, but for the convenience, comfort, and service compared to the back of an AC cattle car, I think people are willing to pay a premium for Porter.
 
The biggest threat to Porter I see is if Air Canada were to bring back Rapidair as a stand-alone service unit with 40-30 minute check-in times, dedicated check-in counters and dedicated gates with 20 min boarding times, etc. A truly innovative move would be to dedicate aircraft to the TOM triangle and create a single class of service just like Porter. They could even create dedicated Rapidair Lounges with less service than the full lounge (ie no showers, heavy food items or booze) but with amenities business travellers would appreciate (free coffee, light snacks, wifi). They could even have the lounge as a differentiator for their Tango Plus customers.

AC could even pull off such a service more profitably by actually right-sizing the aircraft (Airbus narrowbody or Embraer) for the time of day. Heck, they could actually cut back on some flights if they planned it right. 18 departures to Ottawa is probably about right. They could probably upsize a bit and get down to about 16-17 departures but there's not much room for optimization there. But 24 departures to Montreal? They could probably stand to cut back a bit to a more hourly schedule if they used only A321s and A320s....get down to about 20 departures. Using larger airplanes would at least give them economies of scale to compete with the Q400.

There are airlines around the world that create such dedicated airline-within- an-airline services to deploy on high traffic corridors. Somehow though I doubt Air Canada has the operational skill and business wherewithal to do something like that.
 
It sounds like Air Canada is listening to your advice.

Air Canada se lance à l'assaut de Porter

(I read this through Google Translate)

It sounds like Air Canada is planning to return to Toronto Island in 2010.

As well, they are reworking some of their fees, eliminating seat selection fees on domestic flights and the "My Way" fee.

They are adding more services in their "les salles d'attente de Rapidair" as well as dedicated Rapidair check-in counters.
 
As of now, I am doubtful that they could make a serious effort to compete with Porter at YTZ, especially since Porter is well on its way to maxing out its fleet and building out its terminal. As well for AC, operating from the Island, means some serious re-work of their TOM schedules with smaller aircraft. That's going to be complicated for them since half the passengers traveling to Toronto are doing so to connect onwards. Lastly on this point, sticking passengers on a 20 year old Dash 8 (the average age of the AC Dash 8 fleet) after using a no-frills terminal only to drive by a much newer Q400 (equipped with a noise and vibration suppression system which the AC Dash 8s don't have) operated by an airline that provides all the amenities for the same ticket price would only make Air Canada look worse. If they are going to do that, they might as well stick to Pearson. The only thing they'll accomplish is convincing more passengers to switch to Porter.

The smart thing to do would be to bring the Rapidair service changes to Pearson and deploy Airbus narrowbodies and Embraers that are dedicated solely to TOM service. No mixing these birds with the rest of the fleet like AC does today. Instead, they should simply treat all passengers traveling in the triangle as code-share on Rapidair instead of AC mainline. Beyond the service issue, AC made a big mistake when it didn't order the Q400s. The rumour is that they've been scouring the world since to try and find an airline that would sell them a whole bunch in one go. They were even willing to take up the SAS Q400 fleet when it got grounded for landing gear problems:

http://runwaygirl.blogspot.com/2007/11/could-air-canada-jazz-make-sas-q400.html

There are rumours that Jazz has succeeded in finding some Q400s. And their Wikipedia page says they've got ten Q400s in the pipeline. If that's true than they might have a shot at competing with Porter…though there would still be the whole issue of Porter's terminal and in-flight service as well as the number of destinations Porter services. Other than that in the long run the best thing they could do would be to replace the Embraer fleet (a second mistake in light of Bombardier's decision to launch the Cseries) and their A319s with the Cseries. They should hand over any routes that require 75 seater aircraft to Jazz. Running a dedicated Rapidair service from Pearson equipped with Cseries jets would make a decent consolation prize. The jets would be marginally faster allowing for slightly shorter travel times but the same block times. Better for the passenger and some ancillary benefits for airline ops (more time for turn-arounds, reduced fuel costs, etc.). If the rumours are true though and Jazz has lucked out with Q400s, things are going to get really interesting!
 
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