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YYZ, Not Viable In The Future?  
User currently offlineKtachiya From Japan, joined Sep 2004, 1794 posts, RR: 2
Posted (9 years 11 months 1 week 5 days 11 hours ago) and read 3839 times:

http://www.theglobeandmail.com/servlet/ArticleNews/TPStory/LAC/20041117/RGTAAFEES17/TPBusiness/Canadian

Yikes.......... YYZ is making a bad choice here. Do you think this will affect the Canadian economy (Ontario)?

There was another thread the other day about AC leasing six jets. If YYZ is this expensive to land in, then I think the new routes will be out of YVR.

I never knew YYZ was the second most expensive in the world after NRT. I always thought NRT and KIX were the two that were up there!!!

Any comments? (I don't need any geography lessons!!)

Thanks
Ktachiya


Flown on: DC-10-30, B747-200B, B747-300, B747-300SR, B747-400, B747-400D, B767-300, B777-200, B777-200ER, B777-300
35 replies: All unread, showing first 25:
 
User currently offlineCaptainGomes From Canada, joined Feb 2001, 6413 posts, RR: 55
Reply 1, posted (9 years 11 months 1 week 5 days ago) and read 3672 times:

I actually agree with you that YYZ's fees are out of control, and the city or airport do not warrant fees anywhere near the top 10 in the world. I was hoping with good ole' Louis departing, perhaps we'd see a shift in the policies at the GTAA, but maybe it will take a big reality check before that happens.




"it's kind of like an Airbus, it's an engineering marvel, but there's no sense of passion" -- J. Clarkson re: Coxster
User currently offlineYyz717 From Canada, joined Sep 2001, 16307 posts, RR: 56
Reply 2, posted (9 years 11 months 1 week 4 days 23 hours ago) and read 3647 times:

The GTAA fee schedule is working. No need to change it. Revenue is growing briskly. The GTAA is executing a good business plan. The GTAA recognizes airport management as a BUSINESS, not a mecca for aircraft spotters. Th goal is not to maximize passengers per se, but airport revenue.

Passengers and/or airlines not willing to pay the GTAA fees are free to fly from YHM, YXU, BUF or even ROC.




Panam, TWA, Ansett, Eastern.......AC next? Might be good for Canada.
User currently offlineSebring From Canada, joined Jul 2004, 1665 posts, RR: 14
Reply 3, posted (9 years 11 months 1 week 4 days 23 hours ago) and read 3618 times:

Thanks, Lou.

A dysfunctional airport with a dysfunctional cost structure. You have to be the only person on the planet willing to defend it.

Then again, if foreign airlines abandon YYZ, then the last few carriers will make enough money off it to support the costs.





User currently offlineYyz717 From Canada, joined Sep 2001, 16307 posts, RR: 56
Reply 4, posted (9 years 11 months 1 week 4 days 23 hours ago) and read 3605 times:

A dysfunctional airport with a dysfunctional cost structure. You have to be the only person on the planet willing to defend it.

The GTAA BoD and mgmt would also appear to support the current GTAA fee regime. As do all airlines at YYZ and passengers, since they are paying up. So I'm in good company.









Panam, TWA, Ansett, Eastern.......AC next? Might be good for Canada.
User currently offlineYukimizake From Japan, joined Mar 2004, 529 posts, RR: 0
Reply 5, posted (9 years 11 months 1 week 4 days 23 hours ago) and read 3573 times:

That article represents little that is new, the IATA and GTAA have been at each other for years on this issue. So should the GTAA not have built the new T1?, or should we expect the government to help pay for it? The GTAA is a business, they have gone in to significant debt to develop Pearson and now they need the revenue to make their interest payments.

No carriers have left YYZ because of the high fees. Actually, if the fees are so prohibitively expensive then how can a LCC (Westjet) move its operations there from YHM?

There is nothing dysfunctional about this business plan.




'Opfer müssen gebracht werden (Sacrifices must be made)' - Otto Lilienthal
User currently offlineAccargo From Canada, joined Sep 2004, 610 posts, RR: 8
Reply 6, posted (9 years 11 months 1 week 4 days 23 hours ago) and read 3553 times:

The GTAA BoD and mgmt would also appear to support the current GTAA fee regime. As do all airlines at YYZ and passengers, since they are paying up. So I'm in good company.

It would seem that IATA doesn't agree with you or your friends at the GTAA.

Planned fee increase at Pearson outrageous, airline group says

'We don't need a Taj Mahal,' IATA argues

By BRENT JANG
TRANSPORTATION REPORTER
Wednesday, November 17, 2004 - Page B9


A planned increase in landing fees at Toronto's Pearson International Airport is outrageous, and could force some carriers to put the brakes on their growth plans for Toronto as a destination, says the global group representing airlines.

The jump for 2005, as high as 18 per cent according to a draft proposal by the Greater Toronto Airports Authority, would be the latest in a series of landing fee increases hurting the Toronto airport's competitiveness, the International Air Transport Association said.

IATA represents 277 airlines accounting for more than 95 per cent of global scheduled air traffic.

"The airline industry has been moving in the direction of reducing costs and becoming more efficient, but Pearson has increased its landing fees by 208 per cent already since 1998," said Anthony Concil, IATA's director of communications.

Canada's largest airport, which unveiled its new $3.6-billion Terminal 1 in April, is out of step with cost-conscious airlines, Mr. Concil said.

"We need an efficient terminal, but we don't need a Taj Mahal, or Versailles, or whatever you want to call it. We can't have airports moving toward high-cost palaces," he said yesterday from Geneva, where IATA's executive offices are located.

Mr. Concil said Ottawa needs to relieve pressure on the GTAA, the operator of Pearson, to raise landing fees. He urged federal Transport Minister Jean Lapierre to reduce the rents that Ottawa charges to airports across the country.

"Toronto needs to get its costs under control," Mr. Concil said.

GTAA spokeswoman Connie Turner said no decision has been made yet on the level of landing fee increases, but it won't be 18 per cent. "That figure has been taken out of context," she said. "We have received very useful feedback from the airlines, and based on that, we are making adjustments."

Ms. Turner said any reduction in Ottawa's airport rental rates would translate into lower landing fees for airlines. About $160-million, or 20 per cent of the GTAA's $800-million in annual operating costs, goes to rental payments to Ottawa.

She also disputed IATA's assertion that Pearson is a high-cost operation, saying the Toronto airport offers value for the money, compared with other airports that have extra fees.

"We're not outrageous at all. We are not overpriced."

Air Canada spokeswoman Laura Cooke said the Montreal-based airline is concerned about the escalating cost of doing business at its Pearson hub.

"Regardless of the rate increase proposed, given the multiple increases imposed to date by the GTAA, any further fee increase simply contributes to the uncompetitiveness of Pearson and Toronto as a destination," she said.

The Air Transport Research Society said yesterday that Pearson ranked as the most expensive North American airport in its survey of 2003 landing fees in three aircraft categories: $7,965 (U.S.) for a Boeing 747-400, $3,311 for an Airbus 300 and $483 for a CRJ200-LR.

The society, which represents transport researchers around the world, released its survey in Vancouver at a joint conference of the Air Transport Association of Canada and the Canadian Airports Council.

Globally, Pearson ranks second behind Tokyo's Narita Airport as the most expensive airport at which to land, said University of British Columbia Business Professor Tae Oum, who delivered the society's report to conference delegates.

The survey also measured "operating efficiency" and ranked airports in Atlanta and Vancouver as the No. 1 and No. 2 performers in North America. Pearson placed 20th in that ranking of more than 40 North American airports.





User currently offlineYyz717 From Canada, joined Sep 2001, 16307 posts, RR: 56
Reply 7, posted (9 years 11 months 1 week 4 days 23 hours ago) and read 3548 times:

So should the GTAA not have built the new T1?, or should we expect the government to help pay for it?

Exactly. The users (airlines and passengers) should pay for the terminal. Not the govt.

No carriers have left YYZ because of the high fees.

Exactly. More proof the GTAA fees are sustainable and manageable.

Actually, if the fees are so prohibitively expensive then how can a LCC (Westjet) move its operations there from YHM? There is nothing dysfunctional about this business plan.

Nice to see another business-minded anet member!  Big grin








Panam, TWA, Ansett, Eastern.......AC next? Might be good for Canada.
User currently offlineAlekToronto From Canada, joined Nov 2003, 328 posts, RR: 0
Reply 8, posted (9 years 11 months 1 week 4 days 23 hours ago) and read 3547 times:

I have to say that GTAA should charge what they want but number 2 does seem a little high in the world as Toronto is not in the top 10 busiest airports.

Evidently the airlines are still making money flying out of Toronto..if the fees were unsustainable then major airlines would start leaving. For one Westjet and Jetsgo are very concerned about costs and I have not heard them bitch about the fees. I am sure that if the large carriers..AC, WS, BA were leaving then the fees would drop.

On another note I won't be surprised to see some of the smaller cash strapped carriers leave next year..i.e. Alitalia, Olympic, Malev.

Its a business and they will charge what the market will handle.
Now if only the Canadian Government would end their relentless overtaxing of our airline tickets!!
cheers
Alek


User currently offlineGuyBetsy1 From Canada, joined Aug 2001, 840 posts, RR: 6
Reply 9, posted (9 years 11 months 1 week 4 days 22 hours ago) and read 3510 times:

YYZ - remember what has happened to YMX?

User currently offlineBa777-236 From Canada, joined Oct 2001, 674 posts, RR: 4
Reply 10, posted (9 years 11 months 1 week 4 days 22 hours ago) and read 3506 times:

Ya know, I really have a hard time understanding why the GTAA keeps doing this - besides the fact that they can, and no one can stop them.

Ask any business (or retail) expert how the best way to make money is. They'll say to have a lower cost and sell more stuff.

Pearson could (theoretically of course) have LOW landing fees and have tons more traffic. Would this not increase revenue for the airport? I'm sure it would. And if not, it would still help YYZ's rankings among the worlds airports.

In this day of airlines continually loosing money, I simply see no reason why they have to keep doing this.



I like British Airways! I'm not sure why, but I do! ;-)
User currently offlineCessnapimp From Canada, joined Oct 2001, 1320 posts, RR: 19
Reply 11, posted (9 years 11 months 1 week 4 days 22 hours ago) and read 3484 times:


I'll tell you what's not viable... that Pickering idea. I mean seriously, what do they hope to accomplish? What destinations? YOW/YUL? I think they underestimate the ability of Pickerinians (?) actually driving there instead. Seriously though, can someone explain? I'm at a loss here.


User currently offlineYyz717 From Canada, joined Sep 2001, 16307 posts, RR: 56
Reply 12, posted (9 years 11 months 1 week 4 days 22 hours ago) and read 3479 times:

YYZ - remember what has happened to YMX?

The 2 are in different leagues. Incomparable.

Ask any business (or retail) expert how the best way to make money is. They'll say to have a lower cost and sell more stuff.

Only in a perfect market with unlimited growth oppty. These dont exist. Profit is the name of the game, not revenue. Hence, maximization of passengers is not the answer in and of itself.



Panam, TWA, Ansett, Eastern.......AC next? Might be good for Canada.
User currently offlineSebring From Canada, joined Jul 2004, 1665 posts, RR: 14
Reply 13, posted (9 years 11 months 1 week 4 days 22 hours ago) and read 3438 times:

The fact that T1 had to be built doesn't mean it had to be this costly. And the terminal is dysfunctional. It is a lot less convenient for connections that T2 was. There has been no attempt by the GTAA to refinance its debt, nor has it lent its support to the airlines' attempt to get the feds to lower its fees. It is a cynical monopoly, and it is losing money. You are first to bash Air Canada for being a one-time monopoly that couldn't make money. If you were at all consistent, you would have to admit the enormous flaws in the GTAA, the airport authority concept, and this particular project. For one, why charge the airlines now full price as if the terminal was finished? It is garbage, dysfunctional. If you want to go from one international flight to another, you get bussed in from the infield terminal to clear Canada Customs at T1, only to get bussed back to the infield terminal. If you want to fly international to transborder, you have to come off the infield terminal, clear Canada Customs at T1 and go to T2 to clear US customs. Anybody who goes through connections at Toronto calls it a disaster and tries to route through other airports. So the service now provided is not worth the premium fees charged. Maybe when the project is finished, you could justify premium fees, but not now. And you will see AC using its new Embraers to do a lot of Pearson overflying for just that reason. The situation sucks.

I would remind you that Air Canada presented the GTAA with a terminal replacement for T1 which would have cost a fraction of the cost. The AC design, similar to Denver and Atlanta, would have been completed years ago. Instead we have this dog which won't be really finished until 2008 or later.

And yes, the media is increasingly critical of the GTAA. As to whether WJ likes YYZ, their earnings have been going down almost from the day they moved. Let's see how much they like it a year from now. We have also seen airlines downgauging in YYZ. British Airways for one. And you can expect a lot more of this.





User currently offlineYyz717 From Canada, joined Sep 2001, 16307 posts, RR: 56
Reply 14, posted (9 years 11 months 1 week 4 days 21 hours ago) and read 3421 times:

The fact that T1 had to be built doesn't mean it had to be this costly.

Perhaps.

And the terminal is dysfunctional.

Then why did AC fight to keep all 14 gates? Why not let WJ in?

There has been no attempt by the GTAA to refinance its debt

There is no need. The debt servicing is manageable.

nor has it lent its support to the airlines' attempt to get the feds to lower its fees

That is the airlines' issue.

It is garbage, dysfunctional. If you want to go from one international flight to another, you get bussed in from the infield terminal to clear Canada Customs at T1, only to get bussed back to the infield terminal. If you want to fly international to transborder, you have to come off the infield terminal, clear Canada Customs at T1 and go to T2 to clear US customs.L

Then fly from a different airport!

I would remind you that Air Canada presented the GTAA with a terminal replacement for T1 which would have cost a fraction of the cost.

AC has zero credibility regarding any cost estimates. Surely you know this by now.












Panam, TWA, Ansett, Eastern.......AC next? Might be good for Canada.
User currently offlineYukimizake From Japan, joined Mar 2004, 529 posts, RR: 0
Reply 15, posted (9 years 11 months 1 week 4 days 21 hours ago) and read 3389 times:

Ba777-236, if they lowered the landing fees do you really think they would have tons more traffic? Where would this come from? Would there suddenly be a massive influx of foreign carriers? Would new domestic carriers emerge? I doubt if these would happen. What you are suggesting would only make sense if there was an open market of multiple international airports in Toronto all competing against one another.

Guybetsy1 "remember what has happened to YMX"
You can't be serious, how are these even remotely related?

YYZ is in the midst of a privately funded $4.4 Bln development program. In addition, compared to other airports (LHR, LAX, ORD, JFK, NRT, CDG) YYZ has much less of the lucrative heavy type traffic (747, 777, 340). Put these two together and the fact that YYZ has the second highest landing fees should come as no surprise.



'Opfer müssen gebracht werden (Sacrifices must be made)' - Otto Lilienthal
User currently offlineLnglive1011yyz From Canada, joined Oct 2003, 1608 posts, RR: 15
Reply 16, posted (9 years 11 months 1 week 4 days 21 hours ago) and read 3381 times:

It is garbage, dysfunctional. If you want to go from one international flight to another, you get bussed in from the infield terminal to clear Canada Customs at T1, only to get bussed back to the infield terminal. If you want to fly international to transborder, you have to come off the infield terminal, clear Canada Customs at T1 and go to T2 to clear US customs.

May I remind you that the Infield terminal is a temporary solution until the terminal is FINISHED?

Just like typical Canadians, we're all ready to jump all over the GTAA before the gosh-damned thing is finished.

Give them a chance, holy.

1011yyz.



Pack your bags, we're going on a sympathy trip!
User currently offlineOlympus69 From Canada, joined Jun 2002, 1737 posts, RR: 7
Reply 17, posted (9 years 11 months 1 week 4 days 19 hours ago) and read 3314 times:

May I remind you that the Infield terminal is a temporary solution until the terminal is FINISHED?

I sometimes wonder whether the GTAA made a mistake by building the new Terminal where it is. If they had put it in the infield where the hold terminal and the cargo facilities are, they could have completed it before closing any existing terminals. Then they could have either converted T2 to a cargo facility; or if that was not practical, built new cargo facilities - which take a lot less time to build than passenger terminals, in its place.

They could then have turned T1 into a spotters paradise  Smile


User currently offlineMartinairYYZ From Canada, joined Nov 2003, 1209 posts, RR: 7
Reply 18, posted (9 years 11 months 1 week 4 days 18 hours ago) and read 3260 times:

Exactly. The users (airlines and passengers) should pay for the terminal. Not the govt.
Hey, what about your favourite company? Why doesn't the GTAA RIGHTFULLY PAY FOR IT?

Then why did AC fight to keep all 14 gates? Why not let WJ in?


Umm..... becuiase they're their rivals who offer better service and comfort, who WOULD let rivals in? Those AC hogs........

Then fly from a different airport!

Thanks for that, but I didn't need someone to tell me. I'm flying from JFK on my next trip to Europe.

And yes, the media is increasingly critical of the GTAA. As to whether WJ likes YYZ, their earnings have been going down almost from the day they moved. Let's see how much they like it a year from now. We have also seen airlines downgauging in YYZ. British Airways for one. And you can expect a lot more of this.


I agree, this is a very good point, in a year we'll see the airlines that serve YYZ and compare it to now.....



Hmm.......... Anyone think that the money-grabbing bone of a company also wants to build Pickering Airport to ease YYZ congestion when you can't fill all the gates? I don't think so................ I think $$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$

The government should take control of YYZ..... only way to make it with less fees once more... or sell it to Richard Branson! YAAAY

Martin



Chelsea Football Club supporter.
User currently offlineKtachiya From Japan, joined Sep 2004, 1794 posts, RR: 2
Reply 19, posted (9 years 11 months 1 week 4 days 17 hours ago) and read 3198 times:

But this might have impacts on future growth. Or certain cuts to YYZ. As noted in the article, AC is concerned about the rising prices of YYZ. So is many other carriers I suppose. But then this will delay the growth of for instance Asian traffic when YVR already had an advantage. I don't specifically know about their strategies but I would guess the the GTAA wants more Asian traffic to compete against YVR?


Flown on: DC-10-30, B747-200B, B747-300, B747-300SR, B747-400, B747-400D, B767-300, B777-200, B777-200ER, B777-300
User currently offlineB741 From Canada, joined Jan 2004, 716 posts, RR: 1
Reply 20, posted (9 years 11 months 1 week 4 days 13 hours ago) and read 2968 times:

It is very unfortunate YYZ has suffered in the past moreso than other large airports. Pax. and movements are still down compared with 2000 levels whilst other airports are finally surpassing 2000 levels. I think that SARS thing really factored heavily in the equation.


Being Bilingual, I Speak English And Aviation
User currently offlineBa777-236 From Canada, joined Oct 2001, 674 posts, RR: 4
Reply 21, posted (9 years 11 months 1 week 4 days 12 hours ago) and read 2919 times:

Yukimizake and Neil: Yes, I do believe there would be more flights to YYZ were the fees to be lower.

Airlines are trying to save as much money as they can in every way, does this not apply to landing fees as well? If an airline thinks that YYZ may be profitable, but then shudders at the outrageous fees, they'll simply walk away and go on to their next destination.

Just think, Toronto is one of the largest cities in North America in terms of multicultural population. How many international carriers serve the airport? How many others could serve the airport if it was cheaper? I'm sure airlines like Emirates, Virgin Atlantic, Air India etc who all are thinking twice about coming here wouldn't have a hard time about it if it was cheaper.



I like British Airways! I'm not sure why, but I do! ;-)
User currently offlineYukimizake From Japan, joined Mar 2004, 529 posts, RR: 0
Reply 22, posted (9 years 11 months 1 week 4 days 11 hours ago) and read 2837 times:

Ktachiya, I see little, if any, competition between YYZ and YVR. (p.s. Sake ga suki desu ka)

Ba777-236, if YYZ had lower fees how many more flights could they expect? An increase of 10%, 20%, or more? Which other carriers do you think would come?

The actual $ value of the fees at YYZ is roughly equivalent to a single business class ticket on a flight, (1st class for a 747), so although YYZ's fees are expensive in comparison to other airports I think they are still manageable by the airlines. Its the IATA's job to vocally advocate for lower fees, but I don't think the fees are at a level where airlines are seriously reconsidering operating out of YYZ, as I mentioned in my earlier post a LCC (Westjet) recently moved their Southern Ontario operations from YHM to YZZ.



'Opfer müssen gebracht werden (Sacrifices must be made)' - Otto Lilienthal
User currently offlineVonRichtofen From Canada, joined Nov 2000, 4629 posts, RR: 36
Reply 23, posted (9 years 11 months 1 week 4 days 11 hours ago) and read 2784 times:

"p.s. Sake ga suki desu ka"

Me too!  Smile

Been awhile though Big grin



Word
User currently offlineKtachiya From Japan, joined Sep 2004, 1794 posts, RR: 2
Reply 24, posted (9 years 11 months 1 week 4 days 7 hours ago) and read 2731 times:

Sake ga suki desu ka

Yes, thanx for the humor Yukimizake san. Well, I can definetely tell in your name that you love watching "snow while you drink." Same here.

No, but I was just really really suprised. I always thought in terms of landing fees, KIX was more expensive than NRT and those were the top two. But turns out that I am dead wrong. And true, YVR and YYZ can't compete directly, excuse my post.

But an airport, which is not major (ultra major like LAX, SFO, ORD, JFK) but the landing fees are that expensive. So it exceeds KIX? Then KIX is doing relatively well I suppose.



Flown on: DC-10-30, B747-200B, B747-300, B747-300SR, B747-400, B747-400D, B767-300, B777-200, B777-200ER, B777-300
25 Post contains images Olympus69 : Then fly from a different airport! Sure, Neil - Southern Ontario is littered with International Airports for us to choose from. That kind of suggestio
26 Post contains images Ba777-236 : "if YYZ had lower fees how many more flights could they expect? An increase of 10%, 20%, or more? Which other carriers do you think would come? " Yuki
27 BA97 : YYZ is viable and will be--the business and economics are a little off for many reasons. Why do people fly to one airport over another? a) it is their
28 Qb001 : I'm not worried about YYZ. If it really runs into problems, the federal government will run to its rescue, just like it did with the Ontario auto indu
29 Post contains images Olympus69 : The GTAA is a not-for-profit organization. Its directors are appointed by the various municipalities that make up the Greater Toronto area, and also t
30 Sebring : I'm not worried about YYZ. If it really runs into problems, the federal government will run to its rescue, just like it did with the Ontario auto indu
31 EuroLeb : Blaming it on the Federal Government (100%), and the Feds should pay the price for it in the next Federal election (in my opinion). I wonder why the C
32 EnviroTO : I don't have any problem with GTAAs business plan except for the Pickering airport idea. I think that they need to finish Pearson before going and bui
33 Yhmfan : As you can tell from my username, I am a proponent of YHM as TO's secondary airport. Having said that, YYZ is simply charging what the market can abso
34 Ktachiya : Sorry I just have a question out of interest. When did the provincial government hand YYZ to GTAA?
35 Palebird : For all of the experts out there the margins in the airline business are very thin. If you were an "expert" you would know that. Oh well. Landing fees
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