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Old November 8th, 2010, 04:02 PM   #1541
yyzhyd
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KE schedule change to YYZ in S11

From Jim at airlinerroute.net...

Korean is changing to a daytime flight into YYZ starting late March 2011 for the Summer season. See below:

ICN-YYZ
KE073
Depart Seoul (ICN) 10:00AM
Arrive Toronto (YYZ) 10:05AM

YYZ-ICN
KE074
Depart Toronto (YYZ) 12:05PM
Arrive Seoul (ICN) 2:35PM+1

Frequency: Daily
All flights operated by Boeing B777-200ER

Link: http://airlineroute.net/2010/11/06/ke-yyz-s11/
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Old November 8th, 2010, 04:03 PM   #1542
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Quote:
Originally Posted by ACT7 View Post
I think this is an interesting article on the differences in policy between Canada and Australia on the EK/EY issue...

Articel: http://www.flightglobal.com/articles...ddle-east.html
A pretty objective article. Thanks for posting.
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Old November 9th, 2010, 04:43 PM   #1543
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And the BS continues...

Article: http://www.cbc.ca/canada/toronto/sto...anada-uae.html

U.A.E. wanted only Toronto air access: sources


The United Arab Emirates demanded more landing rights for its two national carriers only in Toronto during negotiations with Canada, CBC News has learned.

A government source told Evan Solomon of the CBC's Power & Politics that the U.A.E. demanded open access only to Toronto's Pearson airport and that Ottawa responded with an offer of more access to the airports in Calgary and Vancouver.

But the U.A.E. only wanted Toronto and used Canada's Camp Mirage military base near Dubai as a bargaining chip, the source said.

The two countries couldn't agree and talks broke down, resulting in the U.A.E.'s decision last month to boot Canada from the covert military base that it had been using to stage operations in Afghanistan.

But another source familiar with the negotiations gave a different view, saying that the Canadian government negotiated "in bad faith."

That source said that last August Canada offered each U.A.E. carrier a total of seven new flights, but none to Toronto. When that offer was not accepted, a second offer came: still more new flights to anywhere but still not to Toronto. The carriers also would have had to cut capacity in order to get the landing rights. The U.A.E. refused that offer as well.

A deal could have been done if each carrier had got one more flight per day to Toronto. But that was never on the table so the talks collapsed, the source close to the talks said.

The government source affirmed that the U.A.E. only wanted flights to Toronto, which was one of the reasons the deal collapsed.

A 1999 agreement allows Emirates Airlines and Etihad Airways to fly up to six times a week into Canada. But the U.A.E. government said that with 27,000 Canadians living in that country and a significant trade relationship — the U.A.E. is Canada's largest trade partner in the Middle East and North Africa — six flights per week are not enough.

Air Canada has objected to any increased service by the two U.A.E. airlines to Canadian destinations. It has said that in certain areas, such as Dubai, there is very little originating traffic that comes to Canada.

The airline claimed that U.A.E. carriers like Emirates Airlines picked up Canadians and took them to third countries with a stopover in Dubai, and there was no reciprocal benefit to Canadian carriers.

However, the government source told CBC that Air Canada was not consulted during talks between the two nations.



Read more: http://www.cbc.ca/canada/toronto/sto...#ixzz14nQ2FbYM


In a somewhat related story, the UAE has slapped visa requirements on Canadians travelling there. It now seems abundantly clear that the Sheikh's 7 year-old grandson is running that country. Childish to the nth degree...

Article: http://www.washingtonpost.com/wp-dyn...110901892.html

UAE slaps Canada with visa requirements amid spat


By ADAM SCHRECK
The Associated Press
Tuesday, November 9, 2010; 8:07 AM

DUBAI, United Arab Emirates -- The United Arab Emirates will soon force Canadians to get a visa to travel to the Persian Gulf federation as ties sour between the once-close countries.

The new requirement announced by the UAE's embassy in Ottawa comes amid an increasingly bitter spat centered on landing rights for Emirati airliners. The dispute has already cost Canada access to a military air base that is a crucial link in the supply line for its mission in Afghanistan.

Previously Canadians, like travelers from the U.S., much of Europe and a number of other countries, generally didn't have to apply for a visa before coming to the Emirates and simply had their passports stamped on arrival.

That visa waiver policy will no longer apply to Canada because relations had dipped to a point where they were "neither healthy nor hopeful," according to an official source in the UAE capital Abu Dhabi with knowledge of the matter.

"The visa waivers are granted to countries with a special relationship ... built on economic and other areas of close and growing cooperation," said the person, who was granted anonymity to speak freely about diplomatic matters. "The current status of relations with the government in Canada compared with other countries on the visa waiver program is at a much lower level... It isn't fair to include it with countries with which we have a healthy and productive relationship."

Emiratis need a visa to travel to Canada.

Some 25,000 Canadians live in the Emirates, which is Canada's largest trade partner in the Middle East, according to the UAE. About 200 Canadian companies have operations in the Gulf state.

Jacques Labrie, a spokesman for Canada's Foreign Affairs minister, confirmed that all Canadians traveling to the UAE will need visas beginning Jan. 2.

"All sovereign states have the right to decide the entry requirements for visitors to their countries," Labrie said in an e-mail.

Emirati officials have ratcheted up the pressure on Ottawa after failing to secure additional landing rights for their growing government-backed airlines.

Abu Dhabi last month moved to bar Canada from using a secretive air base outside Dubai that was expected to play an important role in the drawdown of Canadian troops and equipment from Afghanistan. Canada contributes about 2,900 troops to the NATO-led mission.

A UAE official has said the Emirates lobbied against Canada's bid for a non-permanent United Nations Security Council seat. Canada pulled out of the race after falling behind rivals in an early round of voting in what was seen as a significant setback for the G-7 economic power.

The UAE has pushed Canada for years to win greater access for its state-run carriers Emirates and Etihad Airways, arguing they should be allowed more flights to keep up with demand. The two carriers are growing rapidly by launching long-haul routes that funnel travelers through their hubs in Dubai and Abu Dhabi for connecting flights.

Air Canada has argued against increasing the flights, saying little passenger traffic originates from the UAE. It says the airlines are merely taking Canadians to third countries with stopovers in the Gulf.

Emirates and Etihad each run three flights a week to Canada, from Dubai and Abu Dhabi respectively.

Emirates, the Mideast's largest airline, uses its biggest plane, the double-decker Airbus A380, on the Dubai-Toronto route. It says the route - served by a wide-body Boeing 777-300ER until June 1 last year - averaged occupancy levels of more than 90 percent throughout 2009, the most recent year for which it had figures available.

Word of the new visa rules comes just over a month after the UAE dropped its threat to ban key data features on BlackBerry smart phones. The devices, popular with affluent UAE residents, are made by Research in Motion Ltd., one of Canada's most prominent companies.
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Old November 9th, 2010, 08:00 PM   #1544
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So, based on everything on both sides, EK and EY want more access to YYZ and that is the end of the discussion. The ploy for access to YYC and YVR was just that, a ploy!

One additional flight a day to YYZ for both carriers would have resolved this issue when they were receiving 7+ slots to YVR/YYC but none to YYZ and it was rejected. Then even more slots to other places in Canada but no A380 to YYZ and it was still rejected?

What was it that was said about Canada by the UAE? The Canadians negotiated in bad faith! Wow. Now did this little piece of info get leaked into the press in the UAE? Best part is now they want Visa's now? Again, how is this hurting us? Meaning that travellers will now need to pay to get a visa to go and do business in the UAE? Sure, that will hit Canada but it surely will hit the UAE because, which Canadian is going to go through that hassel for a vacation that will take how many hours to get there?

With friends like this, I would defnintely associate more with my enemies. Cannot wait to see what the next move will be. Please note, there has been no public responce from the Canadian Gov't of striking back at the UAE. The hole keeps getting deeper and deeper.
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Old November 9th, 2010, 08:29 PM   #1545
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That's the thing. I had mentioned a while back that it made NO sense for EK to want the access to YVR and YYC that they were claiming, so in a way, Canada called the UAE's bluff and they were right. The only group negotiating in bad faith was the UAE and this latest move to impose visas on Canadians proves even further that the desperation is on their end. Ordering a million A380's with the tiny domestic market that they have obviously has them scrambling a bit.
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Old November 10th, 2010, 04:41 AM   #1546
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Quote:
Originally Posted by ACT7 View Post
That's the thing. I had mentioned a while back that it made NO sense for EK to want the access to YVR and YYC that they were claiming, so in a way, Canada called the UAE's bluff and they were right. The only group negotiating in bad faith was the UAE and this latest move to impose visas on Canadians proves even further that the desperation is on their end. Ordering a million A380's with the tiny domestic market that they have obviously has them scrambling a bit.
I don't think the A380 was intended for Toronto at the beginning, but since they only have a limited number of flights, deploying this aircraft meant they could add capacity without adding flights. I suppose had they gotten increased flights into Toronto, the aircraft would be downgraded back to a smaller widebody.

I doubt they'll have trouble re-deploying their A380 planes elsewhere. Besides, they will not be delivered all at once anyway.
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Old November 10th, 2010, 11:50 AM   #1547
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UAE wants visas from Canadian visitors
Move seen as latest slap in ongoing dispute over landing rights at Canadian airports

9 November 2010
The Globe and Mail

OTTAWA -- The United Arab Emirates will soon require visas from Canadian visitors – a move that appears to be the latest salvo in a dispute between Canada and the wealthy union of Persian Gulf sheikdoms.

A notice posted Monday on the website of the UAE embassy in Ottawa says: “Effective January 02, 2011 Canadian passport holders will need a visa.”

Canadians and travellers from 30 other countries, including the United States, Australia, France and Japan, may currently enter the UAE with nothing more than a passport.

The UAE embassy could not confirm on Monday whether Canadians had been singled out for the new visa requirement. But Canada has been engaged with the UAE in a dispute over landing rights at Canadian airports that recently cost this country its secret military supply base in Dubai.

Canadian troops were forced to pull out of Camp Mirage last week in retaliation for the federal government's refusal to allow UAE carriers Emirates and Etihad Airways to land more often at Canadian airports.

“The Conservative government's incompetence has turned minor problems in Canada-UAE relations into a crisis,” said Paul Dewar, foreign affairs critic for the NDP.

“This is an unprecedented step that will have a major impact on travel and business between Canada and the UAE. Last week, it cost our military $300-million to scramble out of our base in the UAE – now this. The government has to be held accountable for its failure to maintain what used to be a strong relationship between Canada and UAE.”

Jacques Labrie, a spokesman for Foreign Affairs Minister Lawrence Cannon, refused to say whether the visas were retaliatory or the timing simply coincided with the dispute around the planes. He said the UAE made a decision in 2009 to pursue visa reciprocity with many countries, including Canada, that did not offer UAE citizens visa-free access. The UAE government is now implementing its 2009 decision, Mr. Labrie said.

But Fen Hampson, director of the Norman Paterson School of International Affairs at Carleton University in Ottawa, said the fight between the two countries has gotten out of hand. “This is unwarranted escalation of a low-grade trade dispute,” Dr. Hampson said.

The UAE is trying to make Dubai a global hub and is using the state-owned carriers to take on the competition, he said. Likewise, he said, Air Canada, which opposed granting more landing slots to the UAE planes, enjoys various forms of indirect subsidies.

“This is a battle of national champions in that our government is defending the interests of Air Canada and the UAE is trying to take on Air Canada in what are potentially very lucrative routes to its part of the world,” Dr. Hampson said.

But the UAE may have shot itself in the foot if the visa requirement deters Canadian visitors, he said, because whenever a country engages in retaliatory actions it should ask if it will hurt its own interests more than those of its opponent.

“Dubai is suffering as a tourist destination,” Dr. Hampson said. “The economy is not doing well there. A lot of investment is leaving. So it's a place that's on the ropes. And, if you have differences with Canada on this issue, you should keep negotiating. You don't resort to linkage tactics of the kind that they did with the airbase.”

The Canadian government had been using the base for free for nine years. But leaving is complicated: There are huge logistical issues, including moving equipment, and the military will have to factor in fuel costs for the longer routes between Afghanistan and the alternative bases in Germany and Cyprus.
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Old November 10th, 2010, 05:06 PM   #1548
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Quote:
Originally Posted by hkskyline View Post
I don't think the A380 was intended for Toronto at the beginning, but since they only have a limited number of flights, deploying this aircraft meant they could add capacity without adding flights. I suppose had they gotten increased flights into Toronto, the aircraft would be downgraded back to a smaller widebody.

I doubt they'll have trouble re-deploying their A380 planes elsewhere. Besides, they will not be delivered all at once anyway.
A380s have always been part the plans for YYZ.
However I do agree that without the current restrictions they wouldn't have brought them to YYZ so soon.

---

With respect to the Visa requirement for Canadian nationals it's going to really hurt EK more than Canada for several reasons.

There are not many people are O+D to UAE on EK or EY anyway (approx. 50 pax per flight).

Secondly and more importantly many travellers on EK and EY are connecting to South Asia but have friends and/or family in UAE (like me) so they would take advantage of the free stopover allowance either inbound or outbound to visit with them.

Now with this visa requirement the traveller(s) will need to shell out extra $$ for an additional visa to the one required by their final destination country in South Asia etc. in addition to the inconvenience.

So IMHO I don't see how this is latest move will hurt Canada.
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Old November 10th, 2010, 07:09 PM   #1549
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Quote:
Originally Posted by yyzhyd View Post
A380s have always been part the plans for YYZ.
However I do agree that without the current restrictions they wouldn't have brought them to YYZ so soon.

---

With respect to the Visa requirement for Canadian nationals it's going to really hurt EK more than Canada for several reasons.

There are not many people are O+D to UAE on EK or EY anyway (approx. 50 pax per flight).

Secondly and more importantly many travellers on EK and EY are connecting to South Asia but have friends and/or family in UAE (like me) so they would take advantage of the free stopover allowance either inbound or outbound to visit with them.

Now with this visa requirement the traveller(s) will need to shell out extra $$ for an additional visa to the one required by their final destination country in South Asia etc. in addition to the inconvenience.

So IMHO I don't see how this is latest move will hurt Canada.
Couldn't agree more.
My point about EK buying too many A380's (whether they're rolled out over the long term or not) is that they overshot their capabilities as a true competitive airline. Dubai as a whole is a bit of a mirage and EK is no different. Much like the city state itself, it's an airline that thrives on the image of grandeur and power, but in my opinion this latest move shows a bit of deperation and, once again, childishness. Imposing a visa on Canadians really does nothing to affect Canada, Canadians or Air Canada in any way whatsoever.
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Old November 10th, 2010, 08:00 PM   #1550
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Originally Posted by ACT7 View Post
Couldn't agree more.
My point about EK buying too many A380's (whether they're rolled out over the long term or not) is that they overshot their capabilities as a true competitive airline. Dubai as a whole is a bit of a mirage and EK is no different. Much like the city state itself, it's an airline that thrives on the image of grandeur and power, but in my opinion this latest move shows a bit of deperation and, once again, childishness. Imposing a visa on Canadians really does nothing to affect Canada, Canadians or Air Canada in any way whatsoever.
Well, they're making money, and they're aggressive. They achieved something AC can never do. They capitalized on opportunities and took advantage of geography. They're very competitive. AC can never compete against that because they simply don't have the drive or the capabilities to do so. That's the difference, and for that now Ottawa will try to stop them from inflicting more harm on AC.

It's not up to Ottawa to decide if they are buying too many or too few airplanes. Ottawa does not know their business model. But if Ottawa thinks there is a legitimate need to allow them to increase flights to improve bilateral trade or facilitate Canadians travelling, then that's the basis of the decision, not because AC will be hurt.
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Old November 10th, 2010, 08:25 PM   #1551
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Quote:
Originally Posted by hkskyline View Post
Well, they're making money, and they're aggressive. They achieved something AC can never do. They capitalized on opportunities and took advantage of geography. They're very competitive. AC can never compete against that because they simply don't have the drive or the capabilities to do so. That's the difference, and for that now Ottawa will try to stop them from inflicting more harm on AC.
"Well, they're making money" I assume you mean profits... Not operationally they're not. But you already knew that.

"and they're aggressive." And how's that working out for them?

"They achieved something AC can never do" AC reported its 2010 third-quarter operating net income as $261 million.

"They're very competitive" by capacity dumping in markets?

"AC can never compete against that because they simply don't have the drive or the capabilities to do so" Air Canada is reponsible to it's shareholders (unlike EK), it certainly has the drive to serve destinations all over the world and the aircraft capabilities to do so. But chooses not to operate money-losing international routes that others operate as "prestige" routes.

"now Ottawa will try to stop them from inflicting more harm on AC" Incorrect, Ottawa is stopping them from capacity dumping and trying to skim the cream off the top.

Looking back at EK's wonderful statements in the past about how they want to serve Calgary and Vancouver it's funny they didn't take the frequencies when they were offered. So it certainly seems that Ottawa called them on their bluff very accurately.

This is more interesting than a soap opera.
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Last edited by yyzhyd; November 10th, 2010 at 08:34 PM.
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Old November 10th, 2010, 08:29 PM   #1552
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I find it difficult to believe that it's just AC or Ottawa, as we have seen with other jurisdictions wanting to curb overly aggressive expansion by EK and other gulf carriers. It's just that Ottawa had the backbone to stand up to it. And there's no denying from the article that EK was full of shit about it's intentions to expand into Canada. Ottawa offered YVR and YYC and EK turned it down. EK is an airline that is known to have had empty seats purchased by the UAE government to inflate revenue to I think there's no debate about whether or not EK is operating on a level playing field - they simply are not. AC's operating model is very much in line with just about every other major carrier (especially when competing on international routes) and if they truly felt threatened about EK/EY to the degree that the UAE is claiming, then both of those carriers never would have been allowed to enter the Canadian market in the first place.
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Old November 10th, 2010, 08:41 PM   #1553
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Quote:
Originally Posted by yyzhyd View Post
"Well, they're making money" I assume you mean profits... Not operationally they're not. But you already knew that.

"and they're aggressive." And how's that working out for them?

"They achieved something AC can never do" AC reported its 2010 third-quarter operating net income as $261 million.
... and AC lost how much over the years and got how much in bailout money?

Quote:
Originally Posted by yyzhyd View Post
"They're very competitive" by capacity dumping in markets?
A bit counter-intuitive to think they're dumping capacity yet making money. Their competitors are all alive and well actually. Lufthansa, Qantas, and the like seem to be still flying against Emirates, and passengers get more choice and lower airfares.

Quote:
"AC can never compete against that because they simply don't have the drive or the capabilities to do so" Air Canada is reponsible to it's shareholders (unlike EK), it certainly has the drive to serve destinations all over the world and the aircraft capabilities to do so. But chooses not to operate money-losing international routes that others operate as "prestige" routes.
No, AC is also responsible to the Canadian government. They're flying plenty of domestic routes that are losing money yet they have to do it because Ottawa will not let many parts of the country lose their transport connections. Luckily, Emirates doesn't have that big of a problem in their home market, so they can truly focus on expanding internationally and make the transit passenger model work. If they tried hard and had the right aircraft, they could make India profitable, but clearly they were not capable of doing it, so Emirates steps into the picture. International routes are not automatically loss-making. AC could've exploited the American transit market more but they didn't have the guts to expand as aggressively. The key to a successful transit airline is destination range. Qatar, Emirates, Etihad see this and have worked it successfully.

Quote:
"now Ottawa will try to stop them from inflicting more harm on AC" Incorrect, Ottawa is stopping them from capacity dumping and trying to skim the cream off the top.
What exactly is the cream off the top? If there was so much money to be made, why isn't AC out there capturing it, but instead stopping its India flights altogether? How can EK make it work but not AC? Is there something wrong with AC's business model that is not capturing the potential? Should Ottawa construe this as 'capacity dumping' and make it an excuse to stop them from coming in?
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Old November 10th, 2010, 09:15 PM   #1554
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Ok, is it just me or is there some kind of issue with AC and Canada? What is it that I am missing?
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Old November 10th, 2010, 11:32 PM   #1555
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Quote:
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... and AC lost how much over the years and got how much in bailout money?
Not unlike EK being subsidized by the UAE govt. and having their Govt. escalate an airline's agenda via public diplomatic snubs... so what's your point?


Quote:
Originally Posted by hkskyline View Post
A bit counter-intuitive to think they're dumping capacity yet making money. Their competitors are all alive and well actually. Lufthansa, Qantas, and the like seem to be still flying against Emirates, and passengers get more choice and lower airfares.
Who said they're making money? As far as LH is concerned it's very diversified plus Germany is blocking additional access to EK as well.

Quote:
Originally Posted by hkskyline View Post
No, AC is also responsible to the Canadian government. They're flying plenty of domestic routes that are losing money yet they have to do it because Ottawa will not let many parts of the country lose their transport connections.
Quote:
Originally Posted by hkskyline View Post
Luckily, Emirates doesn't have that big of a problem in their home market, so they can truly focus on expanding internationally and make the transit passenger model work. If they tried hard and had the right aircraft, they could make India profitable, but clearly they were not capable of doing it, so Emirates steps into the picture. International routes are not automatically loss-making. AC could've exploited the American transit market more but they didn't have the guts to expand as aggressively. The key to a successful transit airline is destination range. Qatar, Emirates, Etihad see this and have worked it successfully.
What home market? Unless you can actually operate commercial services from AUH to DXB or DXB to SHJ or RAK there is NO home market.
I never said international routes are automatically loss making. I said Air Canada doesn't see it as part of their business plan to operation loss-making routes internationally.
US transit market potential via Canada is a red herring there really isn't much of it.


Quote:
Originally Posted by hkskyline View Post
What exactly is the cream off the top? If there was so much money to be made, why isn't AC out there capturing it, but instead stopping its India flights altogether? How can EK make it work but not AC? Is there something wrong with AC's business model that is not capturing the potential? Should Ottawa construe this as 'capacity dumping' and make it an excuse to stop them from coming in?
Cream off the top is wanting to serve YYZ only and not truly build the service between Canada-UAE or even beyond by beginning service to other Canadian cities... compare that with other airlines that also offer major transit hubs and multiple frequencies:
LH serves YVR, YYC, YYZ, and YUL
KL serves YVR, YYC, YYZ, and YUL
BA serves YVR, YYC, YYZ, and YUL
AF serves YYZ and YUL
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Old November 11th, 2010, 04:59 AM   #1556
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Not unlike EK being subsidized by the UAE govt. and having their Govt. escalate an airline's agenda via public diplomatic snubs... so what's your point?
The point is while Canadians are quick to point out Emirates gets government help, and EK can lobby them to take diplomatic action, yet Ottawa does the exact same and comes to help AC when they need it. So to say they get subsidized hence it's unfair competition is a bit ironic when AC runs on that model as well.

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Originally Posted by yyzhyd View Post
Who said they're making money? As far as LH is concerned it's very diversified plus Germany is blocking additional access to EK as well.
On their annual report, Emirates was profitable in the latest financial year 2009-2010, and also the previous one 2008-2009.
http://www.theemiratesgroup.com/engl...409-565494.pdf

Emirates operates with very strong support from their government, and their goals are closely aligned - to build Dubai as a global air hub. Other countries have not built as close a relationship with their flag carriers. Hence, obviously the likes of AF, LH, AC, etc. would be very afraid because they simply don't have the same leverage with their politicians to do the same. So is that a reason to limit their expansion? Because they're successful in their business model?

Actually, I don't see Emirates being a low-cost competitor in my part of the world at least. They're definitely not the cheapest, and you need to make a stopover in Dubai. Hence, at least here in East Asia, they're not necessarily the carrier of choice. The problem for the Canadian scenario is AC does not have the fleet now to expand anywhere as aggressively into South Asia to compete effectively with EK. But then, there are also other competitors on these routes, albeit no AC in the picture. AI flies into Toronto, and there are also other options with a transit in New York. But Ottawa and AC management are likely very concerned because it means they'll probably never be able to make a profit flying into India when they have the aircraft to do so. So is that a reason to restrict EK?

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Originally Posted by yyzhyd View Post
What home market? Unless you can actually operate commercial services from AUH to DXB or DXB to SHJ or RAK there is NO home market.
I never said international routes are automatically loss making. I said Air Canada doesn't see it as part of their business plan to operation loss-making routes internationally.
US transit market potential via Canada is a red herring there really isn't much of it.
I don't think there is any data available to show DXB-YYZ is losing money. But overall, EK is making money as an airline. There definitely is a transit market for Americans. That's why AC has been expanding international routes out of Toronto, hoping to capture a bit of their huge market. But then, their ability to effectively compete is questionable given the high charges of using Pearson, and the fact that there are plenty of other competitors from south of the border.

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Originally Posted by yyzhyd View Post
Cream off the top is wanting to serve YYZ only and not truly build the service between Canada-UAE or even beyond by beginning service to other Canadian cities... compare that with other airlines that also offer major transit hubs and multiple frequencies:
LH serves YVR, YYC, YYZ, and YUL
KL serves YVR, YYC, YYZ, and YUL
BA serves YVR, YYC, YYZ, and YUL
AF serves YYZ and YUL
But what difference is it with AC serving only select key cities in China, select key cities in Europe, etc? I don't see China forcing to AC fly to CAN in order to get PEK/PVG. Similarly, did the Brits force AC to fly into EDI so they can do additional frequencies into LHR? Did the Germans try to force AC to cover Berlin in order to get Frankfurt, etc? JL flies to a lot of cities in China. Should we expect every new competitor to do the exact same subset of cities? BA flies twice daily to YYZ. Why is EK not allowed the same then? I don't see how AC will accept being imposed by a foreign government to fly to certain secondary cities only to boost services to the primary ones, but apparently Ottawa thinks otherwise. So while Canadians balk at the UAE's involvement in how to run EK, Ottawa is just as intrusive in protecting AC. It's all the same, and I don't think Canadians truly understand that.
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Old November 11th, 2010, 07:09 AM   #1557
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hksyline, I think the biggest point in all of this that you may be missing, is that the government of the UAE is a family that funds its industries, EK and EY included. Other countries do not operate in this manner. While EK may, in legal status, operate as an independent carrier, it is a state owned airline with operating costs heavily backed by the sheikhdom. Yes, AC has received bailouts and subsidies, but that is vastly different than what is happening with EK and EY. Furthermore, it's not even this fact alone that has AC, LH, BA, AF, etc concerned - it's the quantity of seats that EK wants to dump on markets that simply don't require it. Several other airlines have requested greater access to Canada, in particular YYZ and have followed the normal course of bilateral agreements to acquire them. The only thing that makes the UAE special is their massive ego. And now to add to the problem, the UAE's attitude of the means justifying the end doesn't sit well Canada.
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Old November 11th, 2010, 02:18 PM   #1558
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hksyline, I think the biggest point in all of this that you may be missing, is that the government of the UAE is a family that funds its industries, EK and EY included. Other countries do not operate in this manner. While EK may, in legal status, operate as an independent carrier, it is a state owned airline with operating costs heavily backed by the sheikhdom. Yes, AC has received bailouts and subsidies, but that is vastly different than what is happening with EK and EY. Furthermore, it's not even this fact alone that has AC, LH, BA, AF, etc concerned - it's the quantity of seats that EK wants to dump on markets that simply don't require it. Several other airlines have requested greater access to Canada, in particular YYZ and have followed the normal course of bilateral agreements to acquire them. The only thing that makes the UAE special is their massive ego. And now to add to the problem, the UAE's attitude of the means justifying the end doesn't sit well Canada.
Well, although EK is a wholly-owned government corporation, I also see Ottawa being a major financial backer of AC, guaranteeing its survival in bankruptcy proceedings, and trying very hard to fend off competition to protect AC. Ottawa's involvement in AC's day-to-day activities is very evident in the bilateral rights negotiations. Also, I question the UAE government's impact on EK since outside Dubai, it still has to pay the landing charges, fuel, and catering in accordance with what the foreigners charge. So is it truly benefiting so much from the UAE's concessions. Unless you can tell me the UAE government is providing regular cash infusions into EK to operate, I'd think the government is playing a passive role here. If their business model didn't work from the start, I doubt even UAE concessions could save them.

This is clearly a case of Canadian state protectionism of an effectively semi-quasi crown corporation. Whether the UAE gives EK free landing slots does not preclude the fact that Ottawa is out to protect AC, and trying hard to fend off EK from gaining more access to Toronto. That's the problem. Canadians may use the "subsidies" as a reason to keep them out. But by the same token, foreign governments have every right to kick AC off their territory for the same reason - AC does have government funding as an insurance because it is "too big to fail", distorting market forces.
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Old November 11th, 2010, 04:44 PM   #1559
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Well, although EK is a wholly-owned government corporation, I also see Ottawa being a major financial backer of AC, guaranteeing its survival in bankruptcy proceedings, and trying very hard to fend off competition to protect AC. Ottawa's involvement in AC's day-to-day activities is very evident in the bilateral rights negotiations. Also, I question the UAE government's impact on EK since outside Dubai, it still has to pay the landing charges, fuel, and catering in accordance with what the foreigners charge. So is it truly benefiting so much from the UAE's concessions. Unless you can tell me the UAE government is providing regular cash infusions into EK to operate, I'd think the government is playing a passive role here. If their business model didn't work from the start, I doubt even UAE concessions could save them.

This is clearly a case of Canadian state protectionism of an effectively semi-quasi crown corporation. Whether the UAE gives EK free landing slots does not preclude the fact that Ottawa is out to protect AC, and trying hard to fend off EK from gaining more access to Toronto. That's the problem. Canadians may use the "subsidies" as a reason to keep them out. But by the same token, foreign governments have every right to kick AC off their territory for the same reason - AC does have government funding as an insurance because it is "too big to fail", distorting market forces.
A couple of things - yes Ottawa should help ensure fair competition so that AC doesn't go belly up. That's just a responsible thing to do when a national carrier is involved in fair bilateral negotiations. Ottawa has never said that EK will NEVER have expanded access to YYZ or Canada in general (as we've seen EK turned down other landing slots anyway, so to accuse Ottawa of being overly protectionist in this case isn't right) but that they need to follow the proper course of expansion that ALL other airlines have to follow.
It's true that EK has to pay equal landing fees and catering services, etc in foreign countries however that's where the equality ends. As I said before, protecting an airline from bankruptcy to ensure that thousands of jobs aren't lost is very different than Ottawa purchasing billions of dollars worth of airplanes, which is essentially what the UAE government is doing for EK. Ottawa also doesn't buy up empty seats to inflate revenue, a practice that EK has documented and has been confirmed by my step brother who worked for them for 7 years before moving back to Canada. EK's business model isn't really that different from most other airlines in that they have a hub and spoke system, however the quantity of seats that they have is overkill for the size of their market.
You had asked why BA is allowed 2 flights daily into YYZ (at one time they had 3 in the summer) - it's because the number of visitors alone from the UK into Toronto on an annual basis exceeds 200,000. If this was the case for the UAE, I'm certain Ottawa and AC wouldn't be putting up a fight.
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Old November 11th, 2010, 10:29 PM   #1560
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Quote:
Originally Posted by hkskyline View Post
This is clearly a case of Canadian state protectionism of an effectively semi-quasi crown corporation. Whether the UAE gives EK free landing slots does not preclude the fact that Ottawa is out to protect AC, and trying hard to fend off EK from gaining more access to Toronto. That's the problem. Canadians may use the "subsidies" as a reason to keep them out. But by the same token, foreign governments have every right to kick AC off their territory for the same reason - AC does have government funding as an insurance because it is "too big to fail", distorting market forces.
I don't understand how you quote this. One one hand you say that EK as a good business model and they are able to get the support of the government of the UAE but if Air Canada does the same thing, it is state protectionism. So, it is either one thing or the other, which is it?

From where I stand in reading what you have said, it is the same thing in one form or the other so then there should not be a complaint. AC does not receive any state loans or guarantees and have not for some time. It was in the national interest to keep them afloat with loan guarantees.

So lets be clear, a loan guarantee and a loan are two different things. So in effect they received a co-signer for the loan. Only if they AC defaulted would the government be responsible.
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