Canada Mike
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Article On Aftermath Of Canada 3000 Shutdown

Sat Nov 10, 2001 8:20 am

A good, in-depth article from Global News ( about the C3000 shutdown, and the aftermath

Canada Mike
- - - - - - - - - -

Chaos reigns as Canada 3000 grounded
Airline strands passengers after airline ceases operations, files for bankruptcy

Friday, November 09, 2001

Canada 3000 jets sit on the tarmac at Pearson International Airport in Toronto. (CP/Aaron Harris)


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TORONTO (CP) -- Stunned passengers descended upon airports across the country Friday, desperate to rescue travel plans shattered by the abrupt demise of Canada's second-largest airline.

Many ticket-holders didn't learn of Canada 3000's late-night decision to cease operations and cancel its flights until bewildered reservation agents told them the news at the check-in counter.

"We looked at the counter and thought, 'Oh my goodness, there's no lineup. That's great, we're going to be first on the plane,' " said Rosemarie Hardy, who arrived at Toronto's Pearson International Airport shortly after 4 a.m.

"Sorry, it's gone."

Hardy, an elderly woman from Cobourg, Ont., was headed to Florida, where she and travel pal Amelia Smith were scheduled to board a cruise ship destined for the Panama Canal.

"I don't know what we're going to do," said Hardy, her heavy English accent barely masking the fatigue and frustration in her voice.

"I'm very tired, I'm very angry and I think it's a great letdown that we should have known about."

It was much the same story in other parts of the country.

About 60 people were stranded at the airport in St. John's, Nfld., when a flight to Toronto was cancelled.

Rex LeDrew, president of the St. John's Airport Authority, said many of the travellers he spoke to were distraught because their tickets, purchased directly through the airline, weren't insured.

"I saw one family there with four children moving to Edmonton. The husband is out there with the furniture," LeDrew said. "The family is here with five tickets.... They have no way of getting there."

Customers appeared to be the last people the airline was thinking about, he said.

"They just walk away and say, `Damn the torpedoes.' I think it's scandalous."

In Vancouver, Calgary-bound passenger Gary Simco _ aware the night before of Canada 3000's woes, but optimistic his flight would take off _ had all but written off Friday's trip.

It's the holiday travel plans that have him worried, Simco said.

"I'm booked for Christmas, too, on Canada 3000," he said. "Hopefully, if there's a restructuring and they can honour that ticket, then this'll all blow over."

Karen Friesen and her husband, Franz, showed up at the Edmonton airport early Friday morning expecting to get on a Canada 3000 flight to Hawaii.

The week-long trip was intended to be part of their 25th anniversary celebration. Now the Friesens are back at home in Fort Saskatchewan, Alta. hoping their travel agent will be able to get them another flight.

"This was three months in the planning. This wasn't an overnight thing," Friesen said, adding that everything was booked _ including hotels and a house sitter to look after their son and their three foster children.

Stranded Canada 3000 passengers at Montreal's Dorval Airport were furious they weren't contacted before the airline folded.

Tony Trubiano, 70, who's suffering from stomach cancer, was supposed to fly to Florida for a vacation.

The Montreal businessman said he was stuck at Mirabel airport at 4 a.m. and then had to spend $60 for a taxi to get to Dorval Airport.

"My doctor told me I had a problem with my cancer and that I must take a rest," Trubiano said.

"I don't know why they didn't call me; I wouldn't do that with my company. They should have a law against this. I think my blood pressure went up to 200."

Air Canada and Air Transat were offering cut-rate fares to Canada 3000 passengers Friday, but some in Vancouver who took advantage complained they were being treated as second-class citizens.

"Unbelievable. I'm just shaking with outrage," said Craig Marthinsen, who bought an Air Canada ticket, only to wait for hours in line while existing Air Canada passengers were served first.

"I just spent 600 bucks and no one even wanted to talk to you."

Thousands of passengers and crew members alike were stranded Friday in destinations as far away as Britain, Australia and the Caribbean. Company officials were not available for comment.

In a two-paragraph statement issued at midnight EST, the airline said it "regrets to advise that it will cease flying operation effective Nov. 9, 2001. We are therefore unable to transport passengers to their destinations, and recommend that they seek an alternative means of travel."

Signature Vacations, Canada's largest tour operator, said in a release Friday it has made other flight arrangements for passengers who were booked on Canada 3000.

"We had to move on to ensure our passengers receive the holiday they invested in," said Signature Group president John MacNeill.

New schedules were to be finalized Friday and posted on the website

Canada 3000 was granted bankruptcy protection from creditors after failing to reach a deal with its unions that would have cut hundreds of jobs and helped it get over a cash crisis.

The company said it planned to lay off about 1,500 employees, roughly one-third of its staff. Around-the-clock talks with unions reached an impasse Thursday, but Canada 3000 spokeswoman Angela Saclamacis said the company had no comment on the negotiations.

The airline, which is losing about $700,000 a day and has only a week or two of cash left, was granted protection by an Ontario court under the federal Companies' Creditors Arrangement Act.

Confusion reigns across Canada:

There was mass confusion Friday over the sudden shutdown of Canada 3000 Inc. Some of the major developments:

In Ottawa, Transport Minister David Collenette told the Commons that Canada 3000 was trying to find new money so it can resume operations.

Opposition Leader Stockwell Day blistered the government, accusing the federal Liberals of "incompetence and inaction" in its national airline policy.

In Toronto, a spokesman for Signature Vacations, the largest tour operator in Canada, said thousands of its customers, stranded because of the shutdown of Canada 3000, will be brought home at Signature's expense.

In London, the Canadian High Commission has received calls from about 40 people looking for assistance. The high commission was helping them contact family or travel agents to arrange return air tickets on other airlines.

In Montreal, Via Rail, the country's only national passenger rail service, said it didn't have an agreement to accept Canada 3000 tickets. However, it added trains to travel between Montreal and Toronto.

In Calgary, WestJet also said it didn't plan to accept its fallen competitor's tickets.

In Halifax, a travel agency said many tour operators had not yet paid Canada 3000 for booked seats so they will be able to find seats on other airlines such as Air Canada, Tango, WestJet or Skyservice.

In Montreal, former Royal Airlines president Michel Leblanc said he was encouraged that an affidavit on Canada 3000 gives him a chance to negotiate for the assets of his former airline.

In a telephone recording, Canada 3000 Holidays, the company's tour operator, said it "regrets that we have ceased operations."

In the aftermath of Canada 3000's demise Friday, here is a list of the remaining major airlines in the country:

Air Canada: The country's main carrier, based in Montreal,undergoing its own restructuring. Since August, it announced 9,000 job cuts from its workforce of 42,000. The carrier is losing money and has massive debts of $11 billion.

Air Tango: Air Canada's new no-frills discount airline which flies between eight Canadian cities. Began flying Nov. 1 and has been blamed for scooping up some of Canada 3000's business.

Air Transat: A subsidiary of Montreal-based Transat A.T. Inc. The airline is a major charter carrier that flies to 90 destinations in 25 countries and employs 2,500. It's parent recently chopped 1,300 jobs, including 800 at the airline.

WestJet: Canada's healthiest and most valuable airline based on stock market capitalization. The Calgary-based discount carrier earned higher profits in the turbulent third quarter. Earnings jumped up 33 per cent to $13.8 million thanks to an expanded flight network and higher efficiency. Quickly growing. WestJet now links 17 cities, from Victoria to Moncton, with a fleet of 26 Boeing 737 aircraft.

Skyservice Airlines Inc.: A low-cost vacation charter airline owned by Toronto-based Skyservice Investments. The airline operates a total of 11 aircraft.

Air Canada Regional: Air Canada's Halifax-based regional unit which operates under the names Air BC, Air Nova, Air Ontario and Calgary-based Canadian Regional Airlines. The unit, which operates 120 aircraft and has 4,700 employees, could be put up for sale to ease Air Canada's cash crunch. It recently announced 1,000 job cuts and a 24-per cent capacity reduction. Early last year, it was estimated that Air BC, Air Ontario and Air Nova combined for $880 million in annual revenues before they merged with Canadian Regional Airlines.

Additional Resources:

Visit the Canada 3000 Web site to view the memo or call 1-888-300-0669.

Check other airline information in Toronto, Vancouver.

What to do if you have a Canada 3000 ticket

Story: Airline employees rally in Vancouver.

Story: Call before flying, travel agents warn

© Copyright2001 CanWest Interactive and The Canadian Press

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