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ThePointblank
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Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Thu Jun 03, 2021 12:35 am

This is from the Globe and Mail, and it is behind a paywall, but the Globe is saying that Porter Airlines is engaged in a legal and financial dispute with Nieuport Aviation, the owners of Toronto City Airport, and is threatening to leave the airport for Toronto Pearson:

https://www.theglobeandmail.com/busines ... os-island/

Porter Airlines Inc. warned it was losing millions of dollars and threatened to leave Toronto’s island airport in a dispute with the owner of the terminal more than a year before the pandemic sent the air travel industry into crisis.

The battle with Nieuport Aviation is at the centre of a legal action between the two companies over at least $49-million in fees levied by Nieuport, which owns the terminal at Billy Bishop Toronto City Airport.


The dispute according to the Globe dates back from 2018, when Porter notified Nieuport it would begin to reduce its flights at the airport on certain days. Nieuport refused to reduce Porter’s fees or slot allocations, and said the airline was required to pay for 172 of 202 available daily slots per an agreement that was struck with Porter in 2015 when Porter sold off the airport's terminal to Nieuport.

In 2020 during the pandemic, Porter then sued Nieuport in Ontario Superior Court of Justice for $21-million for breach of contract, seeking forgiveness of as much as $45-million in fees for unused slots. Nieuport then countersued Porter, seeking $10-million in punitive damages and payment of the disputed fees, which total about $49-million for the 12 months ending in March, 2020. Nieuport was also demanding Porter replenish its security deposit with Nieuport with a letter of credit worth $11-million in their counter suit.

In it's lawsuit, Porter is alleging Nieuport charges slot fees that are three or four times as expensive as those of Pearson, and that it refused to stop levying the fees during Porter’s shutdown during the pandemic. Porter is also threatening to leave the airport entirely as well, citing factors that have hurt the competitiveness of the airport, from the opening of the UP Express train between downtown Toronto and Pearson, the Federal government's refusal to allow jet operations at the airport, limits on the maximum size of aircraft allowed at the airport, delays to the expansion at the airport, and an overall decline in service at the airport, such as the loss of free coffee, newspapers and cookies for passengers.

Porter's CEO apparently told Nieuport's CEO back in 2018 that Porter's forecasted a loss of $40 million for that fiscal year, and that Pearson’s yearly fees would amount to $50-million less than those of Nieuport.

It's interesting that this bit of information is coming to light, and perhaps does kinda make sense in conjunction with the other rumours around Porter, such as the rumours around an alleged Embraer E2 jet purchase.
 
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CrewBunk
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Thu Jun 03, 2021 1:14 am

Some interesting thoughts arise from this piece ....

Maybe Porter was not as profitable as one was led to believe.

They sold the terminal for A LOT of money. Now they are leasing space like normal airlines, why would they be surprised the purchaser wants some return of its investment?

I find the slot issue the most interesting. That virtual monopoly they held, was by means of the slots they held. By tying up (and paying for) those slots, it kept out competition. Westjet Encore, United Express and Air Canada Express all made applications for slots and were denied.

How can they justify not paying for those slots, when since inception, it gave Porter its edge?
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piedmontf284000
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Thu Jun 03, 2021 1:30 am

I truly believe that with the E-195's coming, that Porter will make YHM their new hub and ditch YZT, and are setting the wheels in motion with this lawsuit.
 
ryan78
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Thu Jun 03, 2021 3:37 am

piedmontf284000 wrote:
I truly believe that with the E-195's coming, that Porter will make YHM their new hub and ditch YZT, and are setting the wheels in motion with this lawsuit.

YHM is way too far from the city and targets the exact opposite clientel that Porter has built a succesful business model on. I think the only logical solution for Porter to grow is to move some of its operation to YYZ. They still need to keep that niche they have downtown and can slowly build up their precense in YYZ with minimal risk, even offering connections between the two airports. The UP Express is 20 minutes to downtown and 30-40 minutes to Porter's check-in counters. They would be foolish to leave YTZ all together, that's their whole brand, but a shift to YYZ with the E-jets/A220 (whatever they have on order) and a handful of Q400's would be a good move for growth. Baby steps though, we'll see what Porter looks like this summer when they resume operations again.
 
hoons90
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Thu Jun 03, 2021 4:35 am

ryan78 wrote:
piedmontf284000 wrote:
I truly believe that with the E-195's coming, that Porter will make YHM their new hub and ditch YZT, and are setting the wheels in motion with this lawsuit.

YHM is way too far from the city and targets the exact opposite clientel that Porter has built a succesful business model on. I think the only logical solution for Porter to grow is to move some of its operation to YYZ. They still need to keep that niche they have downtown and can slowly build up their precense in YYZ with minimal risk, even offering connections between the two airports. The UP Express is 20 minutes to downtown and 30-40 minutes to Porter's check-in counters. They would be foolish to leave YTZ all together, that's their whole brand, but a shift to YYZ with the E-jets/A220 (whatever they have on order) and a handful of Q400's would be a good move for growth. Baby steps though, we'll see what Porter looks like this summer when they resume operations again.


I would be surprised if Porter can even compete with AC/WS at YYZ. Porter had room at YTZ to compete on frequency between certain key city pairs, but what could Porter bring to the table at YYZ? Once we are back to normal traffic levels, would YYZ have enough room to provide Porter with the economies of scale that are required to sustain their business model?

It could be worthwhile for a ULCC airline like Flair to have a small, focus-city type operation at YYZ since their business model doesn't require them to compete on frequency or breadth of network, since they can capture the segment of the market that values cost savings over convenience. But it doesn't seem like Porter has the cost structure that is suited to capture that kind of market, nor does it have the desire to capture that kind of market in the first place (as you said).
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chunhimlai
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Thu Jun 03, 2021 9:37 am

Porter could buy YTZ and expand it for its future hub
 
Cubsrule
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Thu Jun 03, 2021 1:59 pm

hoons90 wrote:
ryan78 wrote:
piedmontf284000 wrote:
I truly believe that with the E-195's coming, that Porter will make YHM their new hub and ditch YZT, and are setting the wheels in motion with this lawsuit.

YHM is way too far from the city and targets the exact opposite clientel that Porter has built a succesful business model on. I think the only logical solution for Porter to grow is to move some of its operation to YYZ. They still need to keep that niche they have downtown and can slowly build up their precense in YYZ with minimal risk, even offering connections between the two airports. The UP Express is 20 minutes to downtown and 30-40 minutes to Porter's check-in counters. They would be foolish to leave YTZ all together, that's their whole brand, but a shift to YYZ with the E-jets/A220 (whatever they have on order) and a handful of Q400's would be a good move for growth. Baby steps though, we'll see what Porter looks like this summer when they resume operations again.


I would be surprised if Porter can even compete with AC/WS at YYZ. Porter had room at YTZ to compete on frequency between certain key city pairs, but what could Porter bring to the table at YYZ? Once we are back to normal traffic levels, would YYZ have enough room to provide Porter with the economies of scale that are required to sustain their business model?

It could be worthwhile for a ULCC airline like Flair to have a small, focus-city type operation at YYZ since their business model doesn't require them to compete on frequency or breadth of network, since they can capture the segment of the market that values cost savings over convenience. But it doesn't seem like Porter has the cost structure that is suited to capture that kind of market, nor does it have the desire to capture that kind of market in the first place (as you said).


I think it would have to be some sort of split operation. If I'm used to flying PD to NYC and BOS on a DH4 from YTZ, would I consider flying PD on a jet to LAX from YYZ? The answer to that is yes, but without YTZ for the short-haul stuff, what's the value proposition for PD? Their service is good, but YTZ is really what makes all the difference.

Even with UP Express - which I'll readily concede has made YYZ much more convenient - YTZ is a huge time saver. On PD, you can pretty consistently be out of the airport 15 minutes after wheels down on domestic and 20 or 25 minutes after wheels down on transborder (even without Nexus and with checked bags). At YYZ you're lucky to be on your stand 15 minutes after touchdown.
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Thenoflyzone
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Thu Jun 03, 2021 2:58 pm

piedmontf284000 wrote:
I truly believe that with the E-195's coming, that Porter will make YHM their new hub and ditch YZT, and are setting the wheels in motion with this lawsuit.


This made me laugh... :lol:
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rampbro
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Thu Jun 03, 2021 3:37 pm

hoons90 wrote:
Once we are back to normal traffic levels, would YYZ have enough room to provide Porter with the economies of scale that are required to sustain their business model?


I mean....where would they go? T3? Domestic ops out in the satellite pier? Sure its new and fancy but its also a 10 minute walk from security. Squabble with WS for the gates right in front of domestic security? Sure, but that zone is a wall of humanity.

Also - the UP only has 7 trainsets, and it shares trackage with commuter and intercity on the approach to Union Station. Adding PD to the mix at YYZ might seem like a marginal growth type scenario, but keep in mind PD has a lot of turns and a downtown-centric clientele. My point is - the UP is not the most scalable RR setup.....
 
crosscheckyyz
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Thu Jun 03, 2021 4:13 pm

They could share ops at YYZ I guess, but wasn't their original intent was to make YOW their hub? Or did I have a concussion and imagine that?
 
multimark
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Thu Jun 03, 2021 6:15 pm

CrewBunk wrote:
Some interesting thoughts arise from this piece ....

Maybe Porter was not as profitable as one was led to believe.

They sold the terminal for A LOT of money. Now they are leasing space like normal airlines, why would they be surprised the purchaser wants some return of its investment?

I find the slot issue the most interesting. That virtual monopoly they held, was by means of the slots they held. By tying up (and paying for) those slots, it kept out competition. Westjet Encore, United Express and Air Canada Express all made applications for slots and were denied.

How can they justify not paying for those slots, when since inception, it gave Porter its edge?


Yes, the hypocrisy of Porter's owners is staggering. Ownership of the terminal was the only thing that kept this quixotic venture aloft. Sounds like they've run through the one-time hit of money gained from selling it.
 
seansasLCY
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Thu Jun 03, 2021 6:28 pm

chunhimlai wrote:
It YTZ allows jet plane Porter could also get 15-20 BOOM for supersonic business flight to Europe


Please stop with these preposterous posts.
 
CFWAD
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Thu Jun 03, 2021 6:41 pm

$5 million a month is not cheap - but to retain your fortress hub and pretty much the basis of your business model - it makes sense to pay for it.

As mentioned, how did PD think the new operator was going to get it's ROI? Pandemic or not. Porter was the one to make the decision to halt flying.

I still think Porter has a huge opportunity without YTZ or YYZ. YOW, YUL, YHZ, YYT all could benefit from regional domestic city pairs and even more, regional transborder city pairs.

Based on the court paperwork, I am now very curious how much of that $700 million from the terminal sale went back to "patient" investors, and what exactly was left to run and operate the airline. The threat of essentially selling off their assets is somewhat peculiar but also could just be an empty threat to a terminal operator losing +80% of their revenue.

Porter has so much potential in this country, including a potential Western base a la Boundary Bay in the Lower Mainland. I hope they manage their assets appropriately over the next 12-24 months.
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9252fly
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Thu Jun 03, 2021 7:03 pm

CrewBunk wrote:
Some interesting thoughts arise from this piece ....

Maybe Porter was not as profitable as one was led to believe.

They sold the terminal for A LOT of money. Now they are leasing space like normal airlines, why would they be surprised the purchaser wants some return of its investment?

I find the slot issue the most interesting. That virtual monopoly they held, was by means of the slots they held. By tying up (and paying for) those slots, it kept out competition. Westjet Encore, United Express and Air Canada Express all made applications for slots and were denied.

How can they justify not paying for those slots, when since inception, it gave Porter its edge?


I have absolutely no sympathy for PD. This is a case of wanting to have your cake and eat it too.
 
airman99o
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Thu Jun 03, 2021 8:12 pm

Should be an interesting Fall with Connect Airlines wanting to get into YTZ. I believe that Porter should be a bit frightened in passing off the Powers that be, I believe Connect will have No issues in paying for slots n the like. I don't feel for the Higher ups at porter, I feel for the front line employees n the like. Should be an interesting few months ahead.
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Cubsrule
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Thu Jun 03, 2021 8:22 pm

CFWAD wrote:
As mentioned, how did PD think the new operator was going to get it's ROI? Pandemic or not. Porter was the one to make the decision to halt flying.


Given the lack of government aid early on, PD almost certainly lost less not flying than they would have flying. Was CBSA even available at YTZ a year ago?
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yowza
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Thu Jun 03, 2021 9:10 pm

PD exploited the bizarre tripartite arrangements at YTZ to slither its way into a position of power and cashed out on extremely favourable terms. Now they're going after their landlord after years of literal rent-seeking and orchestrating the slots to their favour? Let me get my fingers warmed up for my solo on the world's smallest violin.
 
Airlinerdude
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Fri Jun 04, 2021 4:07 pm

airman99o wrote:
Should be an interesting Fall with Connect Airlines wanting to get into YTZ. I believe that Porter should be a bit frightened in passing off the Powers that be, I believe Connect will have No issues in paying for slots n the like. I don't feel for the Higher ups at porter, I feel for the front line employees n the like. Should be an interesting few months ahead.


PD was paying for 172 out of the 202 available slots - that's no small operation and likely accounts for a sizeable portion of Nieuport's revenues. Whether Nieuport likes it or not, they're just as reliant on PD as PD is on Nieuport. No other Canadian airline would be picking up the slack if PD were to cease to exist at YTZ.
 
9252fly
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Fri Jun 04, 2021 4:45 pm

Airlinerdude wrote:
airman99o wrote:
Should be an interesting Fall with Connect Airlines wanting to get into YTZ. I believe that Porter should be a bit frightened in passing off the Powers that be, I believe Connect will have No issues in paying for slots n the like. I don't feel for the Higher ups at porter, I feel for the front line employees n the like. Should be an interesting few months ahead.


PD was paying for 172 out of the 202 available slots - that's no small operation and likely accounts for a sizeable portion of Nieuport's revenues. Whether Nieuport likes it or not, they're just as reliant on PD as PD is on Nieuport. No other Canadian airline would be picking up the slack if PD were to cease to exist at YTZ.


What would PD's position be today had they not sold the terminal to Nieuport? You reap what you sow.
 
airman99o
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Fri Jun 04, 2021 5:34 pm

I believe if Porter still owned the entire place. I doubt they would have stopped flying like they have. I believe they would be dead in the water if they still owned the whole place. The industry is a mess.... should be an interesting fall when things start to get back to the " new " normal.
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aamd11
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Fri Jun 04, 2021 6:50 pm

A loss of $40m in 2018? That’s a real negative turn of events from loss of around $25m just four years earlier. Profit was known not to exist (profit sharing with explores happened only in the years that the terminal sale was applicable to and hasn’t been heard of since), but heavy losses is a new take.

The airline went through cost saving program in the run up to the terminal sale, getting the airline into shape for the post-sale reality of paying to use the facility you had previously owned (and to perhaps make the airline look as viable as possible to maximize the value of the terminal at the time of sale). Staffing levels reduced on the ground, changes to the catering offering, etc. It’s funny the article mentions removing the snacks and free coffee - the airline itself had removed that offering from EWR and had plans to reduce or eliminate in YOW (eventually did eliminate the lounge entirely).

The terminal sale was ostensibly to pay off the fleet - without the financing cost for the 26 aircraft on the books, the weight was lifted and the business would become airborne. The first year post-sale was expected to be challenging as adjustments were made to finances (ie paying rent etc) and was described as a transitional year before profits began to flow. Well, profit never did flow. And if the loss was as steep as $40m in 2019, I suspect profit wasn’t achieved in 2019 either. Since the terminal sale, three new aircraft were added to improve flexibility and reliability. These aircraft were financed, so the airline wasn’t entirely debt free as many had understood after the terminal sale.

It’s not unreasonable to suspect that the terminal sale was a means for the airline to buy out some long term investors who had seen the proposed IPO slide off into the distance. Perhaps the fleet was paid off, but that doesn’t seem to have been the silver bullet it was sold as to the staff back then.

Would Porter be flying today if they owned the terminal? I don’t believe so. Owning the terminal would do nothing to mitigate the entire loss of passengers in their key markets.
 
txkf2010
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Fri Jun 04, 2021 7:38 pm

I'm pretty sure PD and Nieuport are still fighting over US Preclearance too, and that could be adding fuel to the fire.
 
TexasAirCorp
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Fri Jun 04, 2021 8:41 pm

Some anti-Porter blog has posted the papers filed by both Porter and Nieuport regarding the lawsuit: https://porterfail.wordpress.com/porter-vs-nieuport/

The issue seems to be that in order to stop Air Canada from expanding at YTZ, when Porter launched it took on basically all the slots that were available, and just left quite a few unused. In December 2018, due to the massive cost of this, Porter notified PortsToronto and Nieuport that they intended a relinquish a certain number of their slots, and both parties then attempted to find other carriers to take on those slots. These efforts failed, and according to Porter, Nieuport then told Porter it would still charge them for those relinquished slots.

According to Porter, the reason why they are yet to resume operations is because Nieuport has failed to come up with a COVID-19 policy and allow for social distancing etc in the terminal, making it and the slots essentially unusable, however Nieuport is still charging Porter fees for those slots, which it argues is unreasonable since it is apparently Nieuport's fault that it can't use those slots. As of March 2021, Porter owes Nieuport $49 million in slot fees from March 2020. This is apparently deterring Porter investors, hence the lawsuit, and apparently Nieuport is even threatening to seize Porter aircraft.

Nieuport argues that the rules set regarding slot fee payments were actually created by Porter when they allowed Air Canada to use the YTZ terminal. As part of their agreement, Porter forced Air Canada to pay for slots regardless of usage. When the terminal was sold, Porter agreed to operate under the regular YTZ slot rules, so it should be paying slot fees regardless of whether they've used them or not. Nieuport also says it never gave permission for Porter to relinquish slots in 2018. It also says that the claims that it did have a COVID policy in place, and that it was Porter who never released a COVID policy.

Very interestingly, Nieuport says that in December 2018, Porter claimed it was having liquidity issues and would become insolvent without immediate assistance. Nieuport then agreed to halve Porter's immediate liabilities on the condition that it doesn't relinquish slots and puts up three aircraft as collateral.

It seems like Porter has got caught up in its own rules. I'd take both sides with a pinch of salt, but I struggle to see how Porter really has a future if one of its biggest assets (and one of its biggest creditors) hates its guts.
 
jimbo737
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Sat Jun 05, 2021 3:14 am

And then there are those of us who have maintained for years that Porter, whilst offering a good product and service, was not a viable entity.

The defacto sale/leaseback of the terminal filled their coffers to a certain extent, but the debt service / irr requirements of the buyers ensured that anyone operating out of YTZ, namely Porter, would be paying through the nose for any and all services provided by the new owners.

No one would pay $700m for a real estate asset these days without the expectation of generating at least a $50m a year return on it, and with Porter the source of 85% of the commercial activity at the terminal, it doesn’t take a genius to figure out who’s going to ultimately pay for it.

I suspect Porter probably figured their business would mature and would eventually turn the corner allowing them to cover off the high costs they were saddled with.

Evidently, that didn’t occur.

There should be no surprise that these huge costs have apparently resulted in the operation becoming non-viable, even pre-covid.
 
aamd11
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Sat Jun 05, 2021 5:21 pm

jimbo737 wrote:
I suspect Porter probably figured their business would mature and would eventually turn the corner allowing them to cover off the high costs they were saddled with.

Evidently, that didn’t occur.

Hence the revamp of the loyalty program to make it more rewarding for the top flyers, and the alleged primary purpose of buying the three latest aircraft. The theory goes that the three extra planes were intended to allow for more flights at more attractive times, rather than simply operating when they have planes available (LCC style).

I recall something along the lines of the top 20% of passengers were responsible for over 80% of revenue… the top ten passengers alone were responsible for a rather large share of revenue.
 
Dominion301
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Sat Jun 05, 2021 6:41 pm

jimbo737 wrote:
And then there are those of us who have maintained for years that Porter, whilst offering a good product and service, was not a viable entity.

The defacto sale/leaseback of the terminal filled their coffers to a certain extent, but the debt service / irr requirements of the buyers ensured that anyone operating out of YTZ, namely Porter, would be paying through the nose for any and all services provided by the new owners.

No one would pay $700m for a real estate asset these days without the expectation of generating at least a $50m a year return on it, and with Porter the source of 85% of the commercial activity at the terminal, it doesn’t take a genius to figure out who’s going to ultimately pay for it.

I suspect Porter probably figured their business would mature and would eventually turn the corner allowing them to cover off the high costs they were saddled with.

Evidently, that didn’t occur.

There should be no surprise that these huge costs have apparently resulted in the operation becoming non-viable, even pre-covid.


Both sides are kinda in a bind and ultimately co-dependent on one another. Without Porter, Nieuport have a near-worthless asset.

I’ve long been amazed how even with the continued jets ban at YTZ, why PD didn’t build a second hub, even if it were only of a regional nature without jets. YOW seemed like a prime candidate. No AC/WS YYZ double hub to compete with. WS was always an afterthought at YOW and AC, while by far the biggest, is a fraction of the size of the YUL fortress. It was their second largest base, but they have never, ever used the place to connect a single passenger. Even 1 daily bank in both directions would have made sense. For example, it’s hard to get a YYT passenger to go YYT-YHZ-YOW-YTZ-YQT, but much easier to do YYT-YHZ-YOW-YQT...and especially so if it’s YHZ/YFC/YSJ/YQM-YOW-YSB/YAM/YQT, etc. vs the additional YTZ stop and 1 hour of extra flying...not to mention the additional cost of hauling that passenger on the extra leg for the same amount of revenue as the big two.

I sure hope Porter makes a big comeback. The UP Express will never be as good as YTZ for those downtown Toronto meetings...will those themselves return?
 
Trip
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Sat Jun 05, 2021 9:34 pm

Perhaps other carriers will enter YTZ if Porter doesn’t make it.
 
Skywatcher
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Sat Jun 05, 2021 10:18 pm

I think Porter will lose the lawsuit and the short-sighted, cheap/self-centred management group will force Porter to declare bankruptcy. That will enable AC and others to replace Porter at YTZ. All good except I doubt another 30 or so DH-8-400's flooding the used aircraft market can't be good for Viking and the Toronto based DH-8 production line.
 
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CrewBunk
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Sat Jun 05, 2021 11:29 pm

Looking at the links and information provided here allows us to “look behind the curtain” at a few issues about which we have always wondered with regard to Porter.

Using pre-covid 2018, Porter had quite an impressive operation. In and out of its YTZ base, they flew up to 172 flights a day to not only 7 cities in Ontario, but an impressive American operation including Chicago, New York, Pittsburgh, Boston and Washington. Plus operations to Quebec, the Maritimes and Newfoundland.

From its YTZ base, they had competition on only one route, YTZ-YUL. All other YTZ routes were a monopoly by their own design.

Still .... even with that huge monopoly and a very efficient operation .... they were unable to generate a profit during an economic boom. Maybe the “experts” here were correct all along. Maybe it just isn’t a viable operation.
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ExMilitaryEng
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Sun Jun 06, 2021 3:57 am

Skywatcher wrote:
...Porter to declare bankruptcy. That will enable AC and others to replace Porter at YTZ.

Before Porter if you recall, Air Canada had all but abandonned service at YTZ.

So I don't know why they would return in force in YTZ in the event of a Porter demise. It would just dilute their hub critical mass at YYZ.
 
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CrewBunk
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Sun Jun 06, 2021 11:17 am

ExMilitaryEng wrote:
Skywatcher wrote:
...Porter to declare bankruptcy. That will enable AC and others to replace Porter at YTZ.

Before Porter if you recall, Air Canada had all but abandonned service at YTZ.

So I don't know why they would return in force in YTZ in the event of a Porter demise. It would just dilute their hub critical mass at YYZ.

Yes, that’s what everyone said. That Air Canada didn’t want to compete with its very own and very profitable Rapidair service out of YYZ. But, looking at Porter now, I wonder if the issue really isn’t that the (profitable) business simply isn’t there.

With Porter’s stellar reputation and service, a monopoly and reliable aircraft .... honestly, what else could any airline do? (Or want?).

Before Porter, before Jazz / Air Ontario there was City Express. Using DHC-8s, DHC-7s and ST-27s, they built up a small hub at YTZ. Where they ever profitable? (That is before Air Ontario moved in and drove them under).
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Skywatcher
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Sun Jun 06, 2021 4:14 pm

Whatever the case may be Porter must be compounding all the pre-existing problems with the covid shutdown. Even though everybody seems to agree that the cash drain is less from shutdown vs. continued operations the drain must be millions per year nevertheless. Not a pretty picture. I would be worried if Porter owed me any money-they must be on COD terms or advance payment for everything by now.
 
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yyz717
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Sun Jun 06, 2021 5:10 pm

If Porter is not profitable when operating at "full force", i.e. pre-COVID, then one obvious solution is to shrink to a profitable core of operations while relinquishing some (or many) of their YTZ slots. The surplus Q400's could then be used to beef up (say) YOW or YHZ into mini-hubs. If Porter does shrink (or disappear) at YTZ, will AC Jazz increase flights at YTZ? Maybe just adding the YOW-YTZ route but I think that would be it. I could see Westjet Encore move into YTZ if slots opened up at YTZ after a diminished (or disappeared) Porter.

If Porter was profitable pre-COVID, then no change of strategy is needed other than rebuilding traffic, obviously.
I dumped at the gybe mark in strong winds when I looked up at a Porter Q400 on finals. Can't stop spotting.
 
Insertnamehere
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Sun Jun 06, 2021 5:58 pm

Porter’s bread and butter of YTZ was its exact demise. They had no ability to grow past Q400s which aren’t exactly the most economical, especially at the long stage lengths that they had on some routes like YTZ-MLB and YTZ-YHZ.

Just to preface, I love Porter, I think the airline is really interesting and have nothing but great things to say. But not being able to overturn the jet ban with their CS1 (now A220-100) orders meant the airline couldn’t grow to have more capable aircraft.

I think YTZ to major US cities is a great idea, for a larger and more mature airline, and that running a startup out of there wasn’t competitive if they didn’t have another hub to make a lot more money.

I think YYZ is a failure of an idea, it’s already crowded. They need to look to YUL or YOW where they’re still in deep competition with AC but have the ability to grow better with no ludicrous jet ban.

I think if PD pull out, my theory is YTZ will close down and be turned into a park or more overpriced apartment buildings.
 
Skywatcher
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Sun Jun 06, 2021 7:11 pm

Basically it was those over-priced condo's that did in the jet possibility at YTZ. I think you're right-more condos in a few years. Maybe that was the longer term play of Nieuport all along. Are they land flippers? Bombardier did it with Downsview already.

I don't see YUL (low domestic numbers) or YOW (lack of demand for another high priced operation) as an option. YHZ is already saturated and a low (no?) growth market.

I quite honestly don't see a way out for them-the deal they signed with Nieuport is going to fatally choke them at some point. At that point when all the political drama is over Nieuport will have a valuable island property with a bridge as a bonus. I predict Nieuport will be the winner in all this at the end of the saga.
 
airman99o
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Mon Jun 07, 2021 2:02 pm

I feel that a compromise will be reached between Nieuport and Porter. As mentioned earlier Porter is rumored to have purchased 30 E 195 E2s. I smell YHM as their Jet base. With a down sized operation at YTZ. You have the likes of Connect airlines wanting to fly by October. If say Porter does downsize there and concentrate more on the Jet side of things more slots will be opened. You can be fore sure that AC WJ will jump in and attempt to block this US start up. Ths airport isn't going anywhere. Business travel will again rebound, as it did after the 9/11 and it is a choice airport of many living in the DT core.
If we all had a crystal ball to see into the future......... only time will tell with this soap opera and how it will all pan out.
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MIflyer12
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Mon Jun 07, 2021 2:14 pm

yyz717 wrote:
If Porter is not profitable when operating at "full force", i.e. pre-COVID, then one obvious solution is to shrink to a profitable core of operations while relinquishing some (or many) of their YTZ slots.


Shrink to profitability doesn't work outside of bankruptcy. It's too costly to get rid of surplus assets (gates, planes, slots, people), and if those costs aren't shed too much revenue goes toward labor and overhead.
 
drgmobile
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Mon Jun 07, 2021 6:52 pm

ThePointblank wrote:
This is from the Globe and Mail, and it is behind a paywall, but the Globe is saying that Porter Airlines is engaged in a legal and financial dispute with Nieuport Aviation, the owners of Toronto City Airport, and is threatening to leave the airport for Toronto Pearson:

https://www.theglobeandmail.com/busines ... os-island/


This is not correct. Nieuport only owns the terminal. The airport itself is owned and operated by Ports Toronto.
 
runway23
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Mon Jun 07, 2021 7:02 pm

airman99o wrote:
I smell YHM as their Jet base. With a down sized operation at YTZ. You have the likes of Connect airlines wanting to fly by October. If say Porter does downsize there and concentrate more on the Jet side of things more slots will be opened. You can be fore sure that AC WJ will jump in and attempt to block this US start up.


I think YHZ is doubtful and YOW is more likely. YHZ they probably risk Swoop attacking them it's also probably not the best place to base E2s knowing that an ULCC will end up on the same routes sooner or later with lower costs, fares - especially at what is a secondary airport.

Connect is still a paper airline, nothing says AA couldn't partner with PD and come up with something similar to what Connect intends on doing. That is if PD manages to start up again which won't be easy to do after almost a year and a half.
 
airman99o
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Re: Porter Airlines Engaged In A Dispute With Owner Of Toronto City Airport

Tue Jun 08, 2021 2:49 pm

I wasn't saying YHZ. YHM is what I had posted. I would agree YHZ would certainly be an odd pick. Although with the Jets I could make a guess they could make transatlantic ops from there. Speculation for sure. Either way very interesting times ahead.
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