Dripstick From Canada, joined Dec 2001, 2364 posts, RR: 19
Reply 1, posted (13 years 3 months 2 weeks 6 days 2 hours ago) and read 2358 times:
Here is the article...
By KEITH McARTHUR
From Wednesday's Globe and Mail
Halifax β Air Canada is working on plans for a new international leisure airline β another step in its brand-diversification strategy that has already led to the launch of Tango, Jazz, Zip and Jetz.
Air Canada president and chief executive officer Robert Milton said Tuesday the new airline would be modelled after Australian Airlines, a sub-brand scheduled to be launched this fall by Qantas Airways Ltd.
"I'm intrigued by what Qantas has done in Australia," Mr. Milton told reporters in Halifax after Air Canada's annual general meeting.
"I think it's clear in terms of some of what we're doing that we're willing to basically adopt some of the best of what other airlines around the world are doing."
Last month, Qantas confirmed plans to launch a new long-haul brand in October that will offer a single class of service to Asian destinations including Singapore, Hong Kong and Osaka. Australian Airlines will serve destinations that Qantas has been unable to serve profitably through its main carrier.
While there are no firm plans yet, Mr. Milton said a long-haul leisure airline could work for Air Canada because of the large volume of leisure travel going in and out of the country, especially in the summer months.
He said there are some long-haul routes used primarily by leisure travellers where it does not necessarily make sense for Air Canada to offer business class service.
Meanwhile, Air Canada is finalizing plans for an enhanced business-class offering on other international routes. Mr. Milton said the new service, which is expected to include flat beds, will be introduced at the end of the year when the airline takes delivery of a new Airbus A340 aircraft.
Mr. Milton said that if Air Canada decides to go ahead with the new international leisure airline, it could be introduced at any time, even possibly later this year.
"It's the kind of thing that is going on in the marketing department at Air Canada," he said.
Mr. Milton also mused about expanding two other Air Canada brands. He suggested that aircraft could be dedicated to and branded for Air Canada Vacations, which flies to southern sun destinations including Cuba and Mexico.
And he also talked about expanding Air Canada's role in the cargo business. Currently, Air Canada flies cargo in the bellies of passenger planes, but Mr. Milton has talked in the past about setting up a separate cargo airline with a dedicated fleet of aircraft.
"I've never accepted that Canada doesn't have its own very large . . . freighters flying across the Atlantic and Pacific every night. There are dozens of these aircraft operated by foreign airlines flying across the Atlantic," Mr. Milton said.
He said would like to see Air Canada develop a cargo fleet after it has been able to stabilize operations on the passenger side of the business.
In addition to Tango, Air Canada has announced plans for a second discount brand called Zip, which will operate mostly on short-haul routes in Western Canada. Air Canada has also launched a sports charter business call Jetz and rebranded its regional airlines as Jazz.
Some observers have criticized Air Canada's brand diversification strategy, saying it creates confusion in the marketplace. Others say it doesn't make sense for Air Canada to be introducing new brands when it is having a tough enough time returning to profitability.
But Mr. Milton said the Tango brand has surpassed all expectations. He used his speech at Tuesday's annual general meeting to explain the brand strategy to shareholders.
"At Air Canada, we've decided that the concept of sub-brands and complementary brands offers significant upside potential to our business."
Mr. Milton said Air Canada is following a strategy that works in the hotel business. He cited the example of Marriott International, which runs several distinct brands β including Fairfield Inn, Courtyard, Residence Inn and Renaissance Hotels β in addition to its main Marriott Hotels brand.
"Each brand serves a specific and segmented customer base. The brands don't just cater to every possible price point, but also to every identifiable demographic: young, old, business, leisure, short stay, and every possible combination in between," Mr. Milton said.
Dripstick From Canada, joined Dec 2001, 2364 posts, RR: 19
Reply 4, posted (13 years 3 months 2 weeks 6 days 2 hours ago) and read 2316 times:
"While there are no firm plans yet, Mr. Milton said a long-haul leisure airline could work for Air Canada because of the large volume of leisure travel going in and out of the country, especially in the summer months. "
...sounds like he's going after Transat and Skyservice.
Airman99o From Canada, joined Aug 1999, 981 posts, RR: 1
Reply 6, posted (13 years 3 months 2 weeks 5 days 23 hours ago) and read 2283 times:
God every time I hear something about this airline I cannot get over how greedy this airline has become. It totally infuriates me in how they can get away with all these new divisions. Sure it creates new competition but in the end when all the dust has settled. Air Canada will be the sole surviving airline. Tango should be shut down, ZIP should not be allowed to happen, and this new one should be stopped right now.
I am sorry but they should just stick to what they were doing for Years. Regular flying. Just get rid of that idiot at the helm of air Canada. He is what is killing them. Go back to flying as it once was a couple of years back. Compete but do it fairly. They are not doing it fairly now.
Canadi>nBoy From , joined Dec 1969, posts, RR:
Reply 8, posted (13 years 3 months 2 weeks 5 days 22 hours ago) and read 2265 times:
Wake UP, Ottawa, INDEED!
I, too, am sick, absolutely sick and tired of Milton and
Air Canada. This man has G O T to go. This is NOT competition, this is predatory practice in motion. Someone here mentioned the word greed, which is the most suitable term I can think of.
If Ottawa does not put a bloody stop to Zip, Tango, and now this friggin leisure division, it's going to have
to face an angry Canadian public, who will be left with nothing but the AC monopoly. So, now Milton has his greedy little pig eyes set on Transat and Skyservice.
Nice. Very nice. Meanwhile, the buffoons on Parliament Hill continue to have their heads buried in the sand, only raising them to collect their oversized
paycheques, not to mention the pensions.
CX829 From , joined Dec 1969, posts, RR:
Reply 11, posted (13 years 3 months 2 weeks 5 days 18 hours ago) and read 2209 times:
It would be very interesting to see how this plays out...
transferring current fleet off the main AC into this venture or ..... new aircrafts, pilots, crews and jobs? As well as government intervention.... would it ever come?
SafeFlyer From Canada, joined Jan 2001, 627 posts, RR: 4
Reply 12, posted (13 years 3 months 2 weeks 5 days 17 hours ago) and read 2197 times:
They will be spending 20M$ painting Zip planes and now they are talking about something that cut hurt TS or SSV and would need new interiors. And instead of introducing flat beds Uncle Milty, you should be improving economy, offering PTV's instead for example. How do you want them to make money, I'f they are competing against themselves, because, they can't cut Hospitality on the mainline!
JAT From Canada, joined Feb 2000, 1101 posts, RR: 9
Reply 14, posted (13 years 3 months 2 weeks 5 days 17 hours ago) and read 2193 times:
An article in the Star on the same topic at one point stated that "The new airline would serve Canada .... particularly those that want to explore their ethnic roots". If this means that they will start flying to Warsaw, Prauge, Budapest and Moscow, destinations which are currently only served by the respective countries' national airlines, then great. I wouldn't mind getting on a plane in Toronto and getting off in Belgrade if the price is right. I'm sure if they were to start flying to Belgrade they would be cheaper than JAT, if JAT even resumes flights to Canada.
Don't get me wrong, I'm not too hot about these new ridicilous names but if I benefit I don't mind. We'll wait and see, as always.
Yow From , joined Dec 1969, posts, RR:
Reply 15, posted (13 years 3 months 2 weeks 5 days 17 hours ago) and read 2185 times:
Here's a name for the leisure airline...Uncle Milty's Dream Vacation.
But in all seriousness, if AC were to develop a leisure airline that mean adding new international flights from destinations besides YYZ (and bringing back some old ones, like YEG-LHR), then I'm all for it. Also the low-yield, seasonal YYZ-Europe flights again would be sensible to be in an all Hospitality configuration.
Cap'n Dan From Canada, joined Aug 2001, 231 posts, RR: 0
Reply 16, posted (13 years 3 months 2 weeks 5 days 16 hours ago) and read 2171 times:
You guys are all missing the boat. Maybe, just maybe, Milton is ahead of the time. The time of the full service airline has obviously passed - just look at the success of Westjet, Southwest etc. Milton recognises this fact, and is trying to do something about it.
Furthermore, it is not predatory: Air Canada is not selling seats below cost. Why, then, is it predatory for a private company to go about making a profit?
Safeflyer, I think AC is justified in spending money on Executive class amenities - that's where they make their money - people who want to travel economy are generally willing to forgo a PTV for a lower price.
Now I'm going to go put on a football helmet as I wait with baited breath for your ensuing rebuttals.
Dash8King From Canada, joined Nov 2001, 2744 posts, RR: 10
Reply 18, posted (13 years 3 months 2 weeks 5 days 15 hours ago) and read 2153 times:
We have a right as consumers to have competition, these brands are cheap for now so everyone wins but when they knok out WJ, Skyservice and Air Transat nobody wins but them. They recognise that people don't want a monopoly so they change their name and the common Joe doesn't recognise that its AC that is getting the cash so they buy the ticket thinking they are fighting Air Monopoly.
Yyz717 From Canada, joined Sep 2001, 16456 posts, RR: 55
Reply 19, posted (13 years 3 months 2 weeks 5 days 14 hours ago) and read 2142 times:
Ya can't blame AC for being competitive. Collenette should stay out of it. If we want airline competition, as Canadians we can choose to fly other carriers. But the govt should NOT legislate the market....this will only increase costs & inefficiency.
I dumped at the gybe mark in strong winds when I looked up at a Porter Q400 on finals. Can't stop spotting.
Chock head From Samoa, joined May 2002, 148 posts, RR: 0
Reply 20, posted (13 years 3 months 2 weeks 5 days 14 hours ago) and read 2129 times:
I do not think that Zip will be able to run off Westjet.Westjet has established its brand and name much the same way Southwest has.Skyservice and Air Transat I am not so sure about.
It will be interesting to see if AC creates a new company (like Zip) for their leisure airline.That way they get to hire all new non unionized counter staff and contract out eveything else.I bet the AC unions are gearing up for a fight.I envision a scenario where AC itself is only a small niche carrier and the bulk of people flying are on one of the new brands (Zip,Tango,etc).This way AC is able to reduce labour costs while still making the profit for AC.
Slawko From Canada, joined May 1999, 3803 posts, RR: 8
Reply 22, posted (13 years 3 months 2 weeks 5 days 13 hours ago) and read 2104 times:
Well the people who count seem to think he is on the right track, AC's stock closed at 7.82. I agree with YYZ717 Ottawa should stay the hell out of the business...they have done way too much already! If the entire country is like the 90% of you on the westjet/ anticompetition bandwagon then they will not fly on this airline. If the other airlines can not keep up then they will fall away and someone else will come up behind them, thats how the free market works.
"Clive Beddoe says he favours competition, but his actions do not support that idea." Robert Milton - CEO Air Canada
Chock head From Samoa, joined May 2002, 148 posts, RR: 0
Reply 23, posted (13 years 3 months 2 weeks 5 days 13 hours ago) and read 2098 times:
I personally am not anti Air Canada it just seems they engage in bully tactics when they already control 80% of the domestic market.I don`t subscribe to the theory that you need tonnes of government regs , I like letting the free market decide , but there are unfair competition rules that must be enforced so that there is not a monopoly.Governments do this for other businesses as well.
It is a fact that if C3 had not gone tits up that Tango would have been shut down as predatory.AC enjoyed and continues to enjoy preferential treatment from Ottawa.They should only play fair.
Would all the same people who claim that the government should stay out of it feel the same way if Gerry Schwarz had been allowed to purchase AC and then restructure it so that it might have one day been foreign owned.AC can`t cry about govt interference when it has benefited from the govt for so long.
Planeawesome From Canada, joined Sep 2000, 103 posts, RR: 0
Reply 24, posted (13 years 3 months 2 weeks 5 days 13 hours ago) and read 2099 times:
As far as I know they already have an "Air Canada Vacations" division.
I think they sell blocks of some of their scheduled flights to vacation wholesalers just like TS and SSV to some degree.
So what, they splash on a new logo the next tome an A-320 or B-767 is due to be repainted.
It won't lower their costs in a very cost sensitive market segment.The aircraft and fuel costs don't change. I'm sure the unions will ensure that the labor costs stay the same. The overall overhead stays the same. Marketing costs go up.
I think this is basically a non-issue.
: But C3 did go tits up, without tango's help and so Tango could not be viewed as predatory, because the pray died all by itself. I agree AC has enjoyed
: Air Canada Vacations is the Tour Division of Air Canada. They do Have ACV charter flights to the Carribbean and Mexico. Air Canada Vacations one seaso
27 Chock head
: Sorry , not trying to belabour the point here but I wanted to respond to something. "It won't lower their costs in a very cost sensitive market segmen
: "Leisure" airline??? In other words Air Canada is now jumping on the charter market. Look out Skyservice and Transat because the sharks are hungry and
: I understand its business I am a business man myself, but as a consumer I hate it. Zip will work because it is replacing AC mainline flights ie YYC-YV
: "This will hurt WJ because part of the reason that WJ makes so much money is the fact that it charges like half the fare. Now it is competing with the
: "So then in other words WJ was only making money because they were the only low cost operator on the route..." Yes I think that would be the major rea
: Yes, from a business point of view, of course Uncle Miltie is on the right track for his company, there is no denying that. He IS doing what any preda
: I dont know about being able to collect aeroplan points on ZIP, and I dont think that they should be allowed to do so, BUT Aeroplan is now its own com
: Any govt intervention will only make things worse in the long run. No 85% market share is ever sustainable...AC's natural market share will drop over
: Yyz717, yes, your comment is correct. And with all due respect, I fly AC many times throughout the course of the year. However, it is 95% business tra
: Canadi>n Boy, we need you on Speakers Corner to reiterate exactly what you said. WE do have the choice. Problem is though, if AC is going to honor rew
: Rootsgirl, as I said before, if SSV or anyone else thinks that having aeroplan or any reward program makes THAT much of a diff, then they can go out a
: Hi Rootsgirl ! Isnt Sunquest a sister company to Skyservice ? I used to work for Canadi>n Holidays, until the very end. Canadian Airlines sold us off
: Rootsgirl wrote: "There should be laws against the blatant attempts to put other Canadian airlines under." Better yet, some laws that hold back compet
: The best thing Canada can do for it's aviation industry is stop being so damn stubborn and self-righteous and OPEN UP THE MARKET TO FOREIGN AIRLINES!!
: AA and UAL can just stay in the air as they are now....and if we are going to open up our market then you should open up yours...why is it that you pe
: Perhaps what SHOULD have happened was that AC was split into 2 or 3 competing airlines when it was privatized. Too late now of course. Allowing foreig
: If foreign carriers came in here then say bye bye to all the Canadian airlines except for Air Canada. I have said it before, Canada is not set up demo
: I think Milton is playing monopoly but not the fun boardgame type that everyone enjoys.
: For once, many of you pestering morons are making sense. I am pleased that AC's new move (among their other new moves lately) is being seen here as a
: I agree that both AA and UA, in their current condition, have their plates full. But this is not a matter of having a foreign airline come in and tack
47 Chock head
: Great post by Mcdougald.Foreign ownership should be allowed here. I don`t think you would have seen a UA flight here overnight but you may have seen p
: Correct me if I am wrong, but wasn't Robert Milton in the US not to long ago pushing for full dereglation in N. America? I think Air Canada wants to a
: I agree with Rootsgirl. Canada does not have the deomographics or domestic route network to support U.S carriers coming in and "setting up shop" here.
: With very little effort, someone could take the arguments being made against foreign ownership and turn them into arguments against low-cost carriers.
: Milty wants full deregulation because AC can provide much better service at lower costs to any major US carrier, and as such could stand to make a lot
: Do you actually believe for one moment that Air Canada would stand a chance against American and United in the event of full deregulation?? Come on. U
: Here's an analogy: Microsoft makes an operation system, Windows. With it, they decide to bundle Internet Explorer. Now, the Netscape people are starti
: If netscape had teamed up with an operating system, and worked out a deal with computer makers then they would also still be around....Similarly, WJ i
: 1. Tango, Zip, and AC Leisure are all owned subsidaries of Air Canada. Rebranding or "distancing" is not a substitute for a complete separation of the
: 1.This airline shouldn't be allowed to happen.Think about Air Canada's marketing plan: If any airline begins to have even the slightest amount of succ
: Ratrap- Don't worry, Westjet will be filling those gates, soon!
: Westjet will be filling the gates soon? They may fill the gates but can they fill the seats? If the big boy lowers their fares on the same routes as W
: Squigee, I am not talking about Tango, tango is not a separate company it is a part of Air Canada, a brand, nothing more, its like Days Inn, and Holid