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First Air and Canadian North

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New milestone agreement reached to merge First Air and Canadian North to better serve Pan-Arctic communities

Combined airline will offer solid service improvements for passengers

OTTAWA, Sept. 28, 2018 /CNW/ - Makivik Corporation (Makivik) and the Inuvialuit Corporate Group (ICG) today announced they have signed a definitive agreement to merge First Air and Canadian North in order to provide the best possible air services across the Arctic. Following the receipt of government regulatory approvals, Makivik and ICG will proceed to complete the merger. The parties expect to complete the transaction by the end of 2018.

The proposed Pan-Arctic airline will operate under the name "Canadian North" and aircraft will feature the new First Air livery, including its Inukshuk logo. Headquarters for the proposed airline will be located in Ottawa. The two airlines first announced their intention to merge on July 6, 2018.

Customers of First Air and Canadian North will see continuity in operations while the merger is finalized. The parties are committed to keeping customers up-to-date on all developments related to schedules and commercial flights on an ongoing basis.

The new, wholly Inuit-owned airline intends to be an economic driver in the circumpolar region as one of the North's largest private-sector employers. Offering more flights to more destinations, the new airline hopes to help expand Arctic tourism in the communities it serves by increasing demand for tourist-related businesses and services.

"The combined airline will have more opportunity to generate economic spinoffs in our communities," said Charlie Watt Sr., Makivik President. "This agreement solidifies our shared vision for a Pan-Arctic Airline Company which will eventually offer a better circumpolar service than ever before."

The parties are pleased to announce this merger will result in significant service improvements for their valued customers, including:

  • Improved schedule: Better time-of-day options on certain routes, enabling day trips;
  • Better connectivity: Improved connections for Northern communities;
  • Increased service opportunities: Potential new routes to service more Northern destinations;
  • Existing service maintained: No reduction in flight options as a result of merger
  • Further enhanced safety: Will enable aircraft modernization across the network, as well as specialization in maintenance of B737 and ATR aircraft; and
  • Expanded charter business: Particularly related to Alberta natural resources and Northern charters, including for tourism.

"We are proud of Canadian North's track record of providing safe, stable air service to customers in the North," said Patrick Gruben, Chair of the Inuvialuit Development Corporation (IDC). "This exciting milestone in our partnership with Makivik represents a joint commitment to continue providing air service excellence, a most vital lifeline, to Northerners across the Arctic region."

As dedicated stewards of the Arctic environment, both Makivik and ICG are energized by the positive ecological impact the merged airline will have. The consolidation of duplicate, undercapacity flights, for example, will not only improve business efficiencies, but also significantly reduce GHG emissions and black carbon particulate along those routes.

A Lufthansa Consulting report commissioned by the Government of Nunavut supports the need for more efficiency in Nunavut air transportation services; the parties are confident the merger between First Air and Canadian North will meet these essential needs for all Northerners.

In the meantime, both First Air and Canadian North will continue providing Northerners with access to safe, friendly and reliable air travel services across the Arctic.

 

SOURCE Inuvialuit Corporate Group

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For further information: Media contacts: William Tagoona, Communications Coordinator and Media Relations, Makivik Corporation, (819) 964-2925, wtagoona@makivik.org; Mark Fleming, Chief Financial Officer, Inuvialuit Corporate Group, (867) 678-5429, MFleming@inuvialuit.com

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Future of Air North's direct flight to Ottawa up in the air

The airline recently confirmed the route — which flies between Whitehorse and Ottawa with a pitstop in Yellowknife — could be scaled back in the new year.

Airline president Joe Sparling says route won’t be cancelled, could be scaled back outside busy periods

Randi Beers · CBC News · Posted: Nov 06, 2018 7:00 AM CT | Last Updated: 2 hours ago
 
Air North recently confirmed its Whitehorse to Ottawa route could be scaled back in the new year.
People in Yellowknife are anxious about the future of Air North's direct flight to Ottawa, a route many laud as a "relief to Northerners" and the "best flight ever."

The airline recently confirmed the route — which flies between Whitehorse and Ottawa with a pitstop in Yellowknife — could be scaled back in the new year because there hasn't been enough ridership to offset rising fuel costs and Yellowknife airport fees.

Currently, the airline isn't selling tickets on the route past Jan. 7, 2019.

This weekend, Yellowknife resident Mary Tapsell posted on various community groups on Facebook, asking people to let Air North know they depend on the route. Her post attracted dozens of comments and shares.

"I'm just getting it out there because it is expensive [to fly] — a lot of us have friends and family in the South," said Tapsell. "So it's nice having that direct flight."

Tapsell has lived in Yellowknife for 35 years. She says between herself, her husband and children, her family has taken the flight at least a dozen times, and every time it's been full.

She said she's already written to the company to plead her case and suggest more advertising could help sell tickets.

"I said, 'I could be your person,'" said Tapsell, laughing. "I can get the word out."


Mary Tapsell, who has lived in Yellowknife for 35 years, said she jokingly offered to advertise for Air North after she heard the future of the route to Ottawa was in question. (Submitted by Mary Tapsell)

Route won't be cancelled

Air North president Joe Sparling said there is no need to panic — the route isn't going to get cancelled altogether. But the number of flights offered outside the peak periods of summer and the holiday season could be reduced.

"Whether we are looking for it or not, we are getting lots of feedback," said Sparling. "We are certainly keeping that in mind, but at the end of the day it's a business decision."

At the end of the day it's a business decision.- Joe Sparling, Air North president

Sparling said when Air North first offered a direct flight between Whitehorse, Yellowknife and Ottawa, he hoped the federal government and two territorial governments would use the route, but that hasn't been the case.

"It's become a real visiting friends and relatives market … and I think that explains why the route does so well in summer and during holiday periods," he said. "But there are certain times of the year it doesn't do very well at all."


Air North president Joe Sparling says Air North will have a new schedule confirmed within the next few 'days or weeks.' (CBC)

Sparling said specifically, the Yellowknife-Ottawa route is the only one the airline offers where the company has seen traffic decline year after year, and he blames that on an increase of fees at the Yellowknife Airport that came into effect in July 2017. Even though Whitehorse ridership remains healthy, he needs strong sales from all three destinations to make the route work.

Sparling said Air North will have a new schedule confirmed within the next few "days or weeks."

In the meantime, he hasn't stopped courting bureaucrats and other government travellers.

"We're … speaking with both levels of government to try to increase the uptake from government travel," he said. "If we could increase our ridership from government travellers, it would go a long way toward making the route more sustainable."

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Air North blames airport fees, flat ridership for slashed Ottawa flights

'We can’t really operate flights that aren't at least buying the gas and paying the wages,' says company president Joe Sparling.

Airport fees and rising fuel costs mean it's hard to turn a profit on the route, company says

CBC News · Posted: Nov 20, 2018 2:59 PM CT | Last Updated: 3 hours ago
 
On Monday, the Yukon airline confirmed that its Whitehorse-Yellowknife-Ottawa service would cease after January and resume for the summer. (Air North)
1 comments
 

It's official — Air North is scaling back its direct service between Whitehorse, Yellowknife and Ottawa. The scheduled service will now only be offered in the summer.

Earlier this month the Yukon airline said that it was looking at cutting back on the service, but that no decision had been made. On Monday, the company confirmed that the service would cease after January and resume for the summer. 

"All we're doing is we're just eliminating some of the capacity during the slowest periods of the year," said Air North president Joe Sparling.

He blames rising fuel costs, as well as traffic on the route being "kind of flat" for parts of the year. Yellowknife airport fees are also making it hard for the route to turn a profit, Sparling said.

'We can't really operate flights that aren't at least buying the gas and paying the wages,' said Air North president Joe Sparling. (CBC)

"Between the increased landing fees and terminal fees, they've added about $200,000 a year to our cost of operating our [schedules]," he said.

"We can't really operate flights that aren't at least buying the gas and paying the wages."

The Ottawa service, introduced four years ago, will continue as scheduled in January but stop after that.

Summer flights on the Whitehorse-Yellowknife-Ottawa route will then begin on June 15, 2019, and continue until Sept. 1.

Air passes already purchased for the route will be automatically extended until September, and customers who haven't used any segments of their air pass can call for a refund.

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Competition Bureau says Arctic airline merger could cause higher prices, fewer flights

The Competition Bureau says if two Arctic airlines — Canadian North and First Air — merge, it's likely that prices would increase, passenger and cargo capacity would go down and there would be fewer flights.

It said the merger would significantly decrease the competition in the Arctic

Sara Frizzell · CBC News · Posted: Feb 26, 2019 9:02 AM CT | Last Updated: 4 minutes ago
 
canadian-north-plane.jpg
Canadian North and First Air announced their plans to merge in July. (Canadian North /Facebook)
 

The Competition Bureau says if two Arctic airlines —Canadian North and First Air — merge, it's likely that prices would increase, passenger and cargo capacity would go down and there would be fewer flights. 

The bureau made its findings public Tuesday in a report given to the federal Minister of Transport Marc Garneau on Monday.

"The effects of the transaction are likely to include reductions in passenger and cargo capacity, increases in price, and reductions in flight schedules," the press release said.

The bureau said many communities these airlines serve are fly-in only, so the reduction in competition would hinder economic development, community connections, and the supply of food and healthcare.

Makivik Corporation, the organization that represents Inuit in Quebec's Nunavik region, owns First Air and operates across all three territories to more than 30 communities.

Canadian North is headquartered in Calgary and owned by the Inuvialuit Development Corporation. It operates flights to 16 communities in the Northwest Territories and Nunavut with links to Ottawa and Edmonton. 

The two companies announced their plans to merge in July. 

The report is only one step in the process of reviewing the potential airline merger.

Now Transport Canada has until April 12 to make its recommendations to Garneau. He will make his recommendations to cabinet, which will make the final decision.

There is no deadline on when cabinet has to decide.

The bureau also said in the report that should the airlines put measures in place to address its concerns, the bureau would also assess them for Garneau.

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So in the history of all previous mergers of companies in Canada, there has never been an increase in the price of products or decrease of services as a result?

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Makivik Corporation and Inuvialuit Development Group respond to Competition Bureau report on the merger of First Air and Canadian North

 
‎Today, ‎February ‎26, ‎2019, ‏‎40 minutes ago | Canadian Aviation News

Provided by Makivik Corporation/CNW

Logo: Makivik Corporation (CNW Group/Makivik Corporation) Logo: Makivik Corporation (CNW Group/Makivik Corporation) Logo: Inuvialuit Development Group (CNW Group/Makivik Corporation) Logo: Inuvialuit Development Group (CNW Group/Makivik Corporation)

OTTAWA, Feb. 26, 2019 /CNW/ – The ownership groups of First Air and Canadian North today issued the following statement in response to the Competition Bureau’s report regarding a merger between the airlines:

“While we acknowledge the Competition Bureau’s mandate to provide input to the Minister of Transport for his public interest review of the merger between First Air and Canadian North, its artificially restricted findings in this matter are of limited value and suggest a superficial understanding of the Inuit organizations proposing this solution for sustainable northern transportation.

“Our Inuit communities are surprised and extremely dismayed by the report and it is our sincere hope and expectation that the Minister will pursue his mandate of reconciliation and acknowledge that the very organizations proposing this merger have a constitutional mandate to represent the rights and interests of Nunavik and the Inuvialuit Region. 

“The Bureau abandoned its usual practice of considering efficiencies associated with a merger of this nature. By neglecting to consider the overwhelming financial and non-financial benefits to northerners that will be generated, the Bureau’s assessment fails to recognize that a merger is necessary to sustain air travel to the North and relieve the substantial financial burden currently shouldered by Inuit Land Claim Organization (LCO) owners. This process is representative of southern-led institutions’ continued ignorance of northern businesses and we disagree with the Bureau’s decision to ignore the overwhelming and substantial positive impacts this transaction would have for northerners.

“The Bureau’s narrowed focus also ignores the economic realities (i.e., significant inefficiencies due to overlapping routes, insufficient demand and redundant schedules servicing small and sparsely settled remote communities over vast distances) which are driving the parties – who otherwise face the risk of being driven out of business – to do this deal. A merger will allow us to realize operational efficiencies that are needed to bridge the service gap and continue to be financially viable. Contrary to what the Bureau has written in its report, our airlines already face direct competition and the constant possibility of new competitors every day. Our steadfast goal is to provide customers with quality, sustainable air services at competitive prices as a strong, single airline.

“The Makivik Corporation and the Inuvialuit Regional Corporation have been tasked by our Inuit beneficiaries, stakeholders and all Inuit to bridge the gap between northern and southern living conditions. Currently, exorbitantly high costs of living – in part due to the challenging and high-cost nature of operating businesses in the North – result in sub-standard living conditions for our peoples. Before Inuit can be meaningful participants in the national economy, they must be meaningful participants in the northern economy; an efficient Pan-Arctic airline is the only long-term, viable answer that will provide immediate benefits.

“Our Inuit-led solution came about through hundreds of hours of discussion among Inuit and northern-elected leaders. The incomplete analysis in the Competition Bureau’s report demonstrates a lack of understanding of the northern reality which disproportionately and negatively impacts Inuit. We are reminded that the federal government has bailed-out southern national carriers, while northern airlines see continual increases in regulation and fees. The Government of Canada must not ignore Inuit autonomy, elected Inuit leaders and LCOs; continuing to do so only sacrifices the short and long-term socio-economic condition of all northerners.

“Both corporations urge the Minister of Transport to exercise his authority under the Canada Transportation Act to evaluate this merger holistically, cognizant of the long-term needs of northerners and giving appropriate weight to the overwhelmingly positive impacts on certainty and flexibility of service, connectivity, safety, environment, and self-determination of our peoples. We also ask the Minister to take into account that the new airline will act as an economic driver in the circumpolar region as one of the North’s largest private-sector employers. Any meaningful analysis of the merger would consider these significant benefits.

“We will continue working with Transport Canada as it completes its full analysis of the public interest promoted by this merger and considers the important economic, social and environmental factors that the Competition Bureau did not. We are confident that the merger between First Air and Canadian North will emerge as utterly essential to the public interest.

“Upon the completion of Transport Canada’s review and the receipt of all applicable regulatory approvals, we intend to finalize the merger. Until that time, we will continue providing our northern communities with access to safe and reliable air travel services at the financial expense of our Inuit beneficiaries.

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