AC asks pax for advice re Aircraft Purchase

[Kip Powick]

When Air Canada vice president of planning Ben Smith wanted feedback in January on a plan to place a billion-dollar order for new aircraft, he turned to an unlikely source.

While other company officials spent time with Wall Street consultants and bankers weighing whether to outfit their fleet with new jets from Boeing Co. or rival Airbus SA — Air Canada wound up placing an order with Boeing worth as much as $15.9 billion — Smith turned to a small but increasingly influential group: the carrier's frequent flyers.

Over coffee and muffins, and later a luncheon of salmon, beef and chicken — the same as would be served on an Air Canada overseas flight — Smith met at Pearson International Airport with about 30 of Air Canada's super elite and elite members, at least one of whom paid $1,000 to fly from Japan to attend the meeting.

"They just wanted gauge our reaction and ask us which planes we preferred," said Terry Quinn, a 60-year-old mergers and acquisitions consultant who attended the Toronto meeting with Smith.

Across the airline industry, companies are increasingly recognizing the importance of feting their highest-spending customers.

For Air Canada, which spent much of the past two years in bankruptcy protection, sharing tips about prospective routes and onboard perks has become a novel way for the airline to cement ties with its jet-setting Aeroplan members.

Besides meeting with elite and super elite Aeroplan members in Toronto, Smith and other Air Canada executives have held similar meetings in Montreal and Vancouver and have planned another meeting in coming weeks in Calgary.

The story of how the meetings were set up is interesting in itself.

About a year ago, Smith began monitoring comments posted by customers at http://www.flyertalk.com, an Internet site established by the airline's frequent flyers. Within six months, he began posting comments on the website and since has added several hundred postings.

"It's a convenient and efficient way to talk with a number of savvy customers," said Smith, 33. "I'd like to talk to our customers all day, but you just don't get that chance."

Postings about last week's meeting in Vancouver have garnered 10,000 views already, he said.

In addition to a no-holds-barred question-and-answer period, the Aeroplan members who have attended the meetings have also been given the chance to tour airplane hangars and to take a spin in an Air Canada flight simulator — something that typically would cost 79,000 Aeroplan points.

"The past few years Air Canada customer service has really not been good," Quinn said. "But with meetings like this, they've really tried to make it different. This is a situation where they seem to really want to hear your (gripes) and commit to doing something about them."

For instance, Quinn said several Air Canada customers complained to Smith about the fact that UAL Corp.'s United Airlines reserves economy-section seats with extra leg room for its frequent flyers. Air Canada has promised to consider a similar move, Quinn said.

Lee Carney, a 38-year-old commercial photographer from Vancouver, agreed that the recent meeting with Smith marked one of the first times that Air Canada officials have welcomed criticism.

"It's a smart move," Carney said. Elite Aeroplan members "are small in numbers but represent a disproportionate part of their revenue."

The meetings are also a chance for Aeroplan members to get confirmation about rumoured Air Canada strategies, ahead of press releases or other announcements.

At the recent meeting between Air Canada executives and Aeroplan members in Vancouver, for instance, Smith's team gave more details about how the company's new Boeing 777 planes would be designed. According to people who attended the meeting, Air Canada executives said the company was working with Verizon and BCE Inc.'s Bell to offer onboard wireless Internet service, tentatively priced at $30 (U.S.) per flight.

Other possibilities the carrier raised included: the prospect of a new "unlimited travel" pass that would allow the holder to buy unlimited travel on Air Canada for a defined period of time; allowing customers to view a map of available seats before booking travel at the airline's website; and introducing routes as soon as 2007 from Toronto to Dubai, Tehran, Karachi and Bombay.

To be sure, some of the measures that have been suggested by Air Canada's most frequent customers have not been embraced by Smith and others.

For instance, one suggestion raised by customers included allowing passengers to use the onboard entertainment system to listen to communication between the plane and air traffic control. Pilots would object to that, the executives said.

Other suggestions that were dismissed included the granting of lifetime super elite status

[AME]

For instance, Quinn said several Air Canada customers complained to Smith about the fact that UAL Corp.'s United Airlines reserves economy-section seats with extra leg room for its frequent flyers. Air Canada has promised to consider a similar move, Quinn said

.

No more exit rows for employees

The meetings are also a chance for Aeroplan members to get confirmation about rumoured Air Canada strategies, ahead of press releases or other announcements.

Insider trading?

one suggestion raised by customers included allowing passengers to use the onboard entertainment system to listen to communication between the plane and air traffic control. Pilots would object to that

You think?

[ccairspace]

For instance, one suggestion raised by customers included allowing passengers to use the onboard entertainment system to listen to communication between the plane and air traffic control. Pilots would object to that, the executives said.

I remember listening to ATC and the aircraft on either AA or UA some years ago while flying in the States. Do they still do that?

[Maverick]

As of late last year United did indeed still have an ATC channel on their aircraft.

[beaverboy]

As of late last year United did indeed still have an ATC channel on their aircraft.

They still have that option. I just flew with an ex United pilot and they hated it. They would receive numerous letters and phone calls regarding the pilots missing calls. No doubt that would have been the private pilot in the back that was just waiting for his chance to land the big airliner.

[Guest acyyc]

They still have that option. I just flew with an ex United pilot and they hated it. They would receive numerous letters and phone calls regarding the pilots missing calls. No doubt that would have been the private pilot in the back that was just waiting for his chance to land the big airliner.

They have the option of turning it off. We flew from LAX-HNL last Nov and requested them to turn it on but they wouldn't.

[CanadaEH]

When Air Canada vice president of planning Ben Smith wanted feedback in January on a plan to place a billion-dollar order for new aircraft, he turned to an unlikely source.

Were the employees ever considered for feedback?

AME:

The meetings are also a chance for Aeroplan members to get confirmation about rumoured Air Canada strategies, ahead of press releases or other announcements.

Insider Trading?

Sounds like it.

[Mitch Cronin]

Were the employees ever considered for feedback?

...whaddya think this is? WestJet? ... Employees at AC remain as a necessary evil in the minds of our lords and princes... Ask us what we think? Hah! May as well ask us if we're unhappy about anything.... not bloody likely.

...'ang on... I'm not dead yet...

[Cargo Agent]

QUOTE

Insider Trading?

Sounds like it.

Maybe next time instead of hacking into our computer's one of your exec's should become AC Super Elite and go to one of these "Do's"

[CanadaEH]

Maybe next time instead of hacking into our computer's one of your exec's should become AC Super Elite and go to one of these "Do's"

And they'd still get treated better than you or any of your co-workers by your company.

[deicer]

And they'd still get treated better than you or any of your co-workers by your company.

C'mon...

Don't you know there are those of us who like getting paid for a little "S&M"

[Cargo Agent]

C'mon...

Don't you know there are those of us who like getting paid for a little "S&M"

Anyone who willingly climbed into a bucket and went up 40 or 50 feet in the air, swaying back and forth, in the middle of winter, to spray a haz chemical that usually ended up soaking them is definately a bit of a masochist.

[Cargo Agent]

And they'd still get treated better than you or any of your co-workers by your company.

C Eh, I don't think the company is treating me too badly. I've worked at places that are a lot worse, and a few that are a little better. The better ones were small places (less than 100 employee's). A lot of the gripeing about our employer IMO stems from the Company/Union relationship and the rules that must be followed as a result of the contracts. Others will no doubt disagree, but with 30,000+ employee's, I wouldn't expect anything else. I like the direction we're heading and some of the changes I see from Brewer are encouraging.

Yes, things could be better, but they could be a lot worse.

CA

[Kip Powick]

Anyone who willingly climbed into a bucket and went up 40 or 50 feet in the air, swaying back and forth, in the middle of winter, to spray a haz chemical that usually ended up soaking them is definately a bit of a masochist.

Cargo Agent

Really ?? The closest deicer ever came to an ice bucket was at his last hotel when he was leaning over looking for a cube. He sits in a truck, surrounded by radios and empty Tim's, his impeccable suit covered in crumbs......you got the wrong guy if you really think deicer knows the little Mexican called "Manual Labour"

[better4me]

Insider trading?

You think?

The data being discussed is nonfinancial in nature and cannot be considered insider information. Therefore this a pass from the securities regulators.

[boestar]

I was on a UA flight a couple of years ago and listening to the ATC channel during taxi and takeoff. We had to reject the takeoff due to a problem. There was a click and silence on the ATC channel. Then Click on it came and we taxied for takeoff. Again reject, taxi off some chatter on the atc channel then click...silence. A few minutes passed then an announcment and taxi for takeoff...again. finally a good takeoff and all the ATC you could stay awake through. Cool option but I would have like to hear the conversation regarding the problem.

It turned out to be a takeoff warning problem...just indication.

B

[deicer]

Cargo Agent

Really ?? The closest deicer ever came to an ice bucket was at his last hotel when he was leaning over looking for a cube.  He sits in a truck, surrounded by radios and empty Tim's, his impeccable suit covered in crumbs......you got the wrong guy if you really think deicer  knows the little Mexican called "Manual Labour" 

You have obviously misinterpreted me with the "other" fat ba$tards that work there

It has become quite the workout in the last few years with all the Molly Maiding going on.....

Great way to save costs it to get up there on the rack, pull out the mop, and start scrubbing. It is a wonderful way to gain a greater appreciation for the actual reality of the term "wing area"

Even some of the WS folks appreciated our services this winter here in YYZ. They were gracious to pass along nice comments after seeing our butt cracks out their windows

Last I was told, they were crediting us with savings of $4.5 mil this year for YYZ station.

I would love to invite you back for a day Kip, to have you come and see how much fun it can really be, but we can't get the van that close to a RJ for you to mop the wing

Iceman