I'm waiting

[dragon]

theres a &%$@! in every crowd, sometimes two. just be glad you're not it.

cheers

[dragon]

not all brett

theres a di_khead in most every crowd, sometimes two. just be glad you're not it.

cheers

[Guest AME]

I deleted my msg, and you're right

B

[Guest lancaster]

The difference between now and then, as far as survival is concerned, is that there have been lobbyists this time telling the government "hands Off". That has never happened before. In other words, no more hand outs for AC. And rightly so.

[Don Hudson]

ECB;

I understand what you're saying and can't disagree entirely, although when TCA was created it was to be an instrument of government policy, (a role which they are still reluctant to give up) and as such wouldn't have actually disappeared off the scene in the same sense as it might have only recently, it still had to show a profit for the owner and the charter required it not to be a burden to the taxpayer. Now that's an argument which has been exhaustively treated here and elsewhere.

It wasn't so much the nanny-state which kept a corporate welfare case alive, but a matter of ensuring that transportation needs (and the needs of government policy...don't get me started) were served and for most of those years, TCA adhered successfully to its mandate. It was a different industry, and a different country in the years 1937 to the mid-70's, and it was certainly a different industry after 1986-88. That aspect of Air Canada's history does form part of this discussion but not all of it and that's what I wanted to convey.

We must remember too, that from the very beginning, Canadian Pacific (originally CAL..CPA emerged from an amalgam of several airlines)was also heavily funded by the CP empire, mainly the CPR and had a similar relationship, (rocky) with its constant benefactor,

("Within two years, CP Air’s financial reserves had been devastated by the increases in fuel prices. In 1973, its fuel bill was $24 million; in 1975, it totalled $69 million. Although more miles were flown, of the $45 million increase, $29 million was directly attributable to higher fuel prices. The deficit was especially embarrassing for Gilmer, who was about to retire, because all other CP transportation branches reported substantial profits that year. Ian Sinclair had succeeded in bullying the remainder of the Canadian Pacific empire into paying its way. Although he loved nothing better than to chat with CP Air flight crew, Sinclair often said the airline had been running too long on a mixture of gasoline fumes and glamour. With the CP Air Operations Centre flowing with red ink, the telephone calls between Windsor Station and Vancouver must have been decidedly chilly.")* p. 265,

until finally in the mid-80's it too was sold outright,

(". . . cutting a money-losing limb from the corporate tree would mean an extra $175 million for it's [CP Ltd.'s] treasury.")* p. 299-302,

Even in 1946 it was recognized that CPA would have foundered without its owner's (CPR) financial support and loans,

"He [CD Howe] knew that if the CPR jettisoned CPA, the airline would suffer the same fate as Laurentide Air Services, Canadian Airways. Ltd, Yukon Southern Air Thansport, Starrat (and Mackenzie Air Services—it would inevitably go bankrupt. " p. 158

How much of taxpayer dollars, through CP Ltd, went to CPA can be academically discussed I suppose, but its of little interest now.

But the implication in these discussions is always that CPA was a struggling, independant private airline while TCA suckled on the silver spoon and that's simply untrue, and to blame the poor performance on the machinations of either the government or TCA's leaders is similarly wrong,

"Colussy and Carty staked much on a strategy that made sense for CPAir at the time: they acquired or allied it with regionals that served a similar purpose. But as the CPR discovered in 1942, throwing together diverse aircraft fleets and discontented employees who thought their pensions and seniority were in jeopardy and then hoping for harmony was asking for trouble.

"Whatever the future labour problems might be, more tangible was CPAL's debt, which in 1986 had ballooned to $600 million, something that the parent company, CP Ltd., viewed with trepidation. It had received no cash flow from the airline in the 1980's…

. . . .

"The CP Ltd. portfolio managers watched as Don Carty pursued his aggressive growth strategy through expansion into Eastern Canada, and the quesiton they must have asked each other was, Will it work? Whoever ran it, under whatever colours or name, the airline had a record of poor financial performance, and whatever Carty did in the jungle of deregulation was risky.

….

"Either way, CP Ltd. was preparing to leave the airline business, and Stinson contacted Rhys Eyton."*

In these last quotes, there is a glimpse of the future, wouldn't one think?...

Beginning Air Canada's history at 1987 as the litmus date from which it may be viewed as a "success or failure" as a private corporation simplifies the discussion to much to be meaningful, but here we are, and we'll have to see what our future is in this industry. We're shaping it right now.

My original point is that Westjet has yet to experience the full range of what this industry has to "offer" by way of challenges and that view extends beyond mere economics.

I realize the success of Southwest, the most heavily unionized airline in the US and that may bode very well for Westjet but we're not there yet.

As well, (I'm sure you recognize this) AC is a substantially different airline than Southwest facing completely different challenges, labour agreements, regulatory environments and government interventions.

The key to understanding these kinds of discussions is, do they serve knowledge of history or do they serve the parochial interests of current/ongoing disagreements and even court cases? As I said to Lancaster, the line between rhetoric and discussion has always been a foggy one in this forum and I am not immune to crossing it either.

Kind regards,

Don

*Wingwalkers, Peter Pigott, Harbour, 1998

[dagger]

That's why Collenette was astounded when AC lined up GECAS to provide the DIP financing when the feds fully expected to write the cheque (as they had expected to do for C3).

[Guest ecb]

Good and thoughtful post. Thanks

[IFG]

Hi, Don. A couple of points...

Re: "How much of taxpayer dollars, through CP Ltd, went to CPA can be academically discussed " - Could you elaborate?

While it's true that CPA had its own benefactor in the CP 'empire', they were private pockets, ie not those of your parents and mine which ultimately funded the governments of those days. Nor do your references from Pigott's book deal in any way with the alleged favouritism in regulation, route approvals etc., a form of nurture unavailable to CP Ltd. That is a 'rabbit trail' for now tho'.

Rather than trying to masquerade AC's history pre-1988 as a commercially successful one, I think your point about its existance as an instrument of public policy is well said. I'd add that it's also something for the operational folks to take great pride in, of pioneering work professionally done. Whatever political or commercial shenanigans may have been undertaken at the corporate level, to massage the economics of the enterprise (but also making life difficult for anybody attempting to earn their own living in air transport) are not the responsibility of those people and their successors, unless they adopt it in perpetuating the arguments.

Cheers, IFG

[IFG]

Hi, Don. A couple of points...

Re: "How much of taxpayer dollars, through CP Ltd, went to CPA can be academically discussed" - Could you elaborate?

While it's true that CPA had its own benefactor in the CP 'empire', they were private pockets, ie not those of your parents and mine which ultimately funded the governments of those days. Nor do your references from Pigott's book deal in any way with the alleged favouritism in regulation, route approvals etc., a form of nurture unavailable to CP Ltd. That is a 'rabbit trail' for now tho'.

Rather than trying to masquerade AC's pre-1988 history as a commercially successful one, I think your point about its existance as an instrument of public policy is well said. I'd add that it's also something for the operational folks to take great pride in, of pioneering work professionally done. Whatever political or commercial shenanigans may have been undertaken at the corporate level, to massage the economics of the enterprise (but also making life difficult for anybody attempting to earn their own living in air transport), are not the responsibility of those people and their successors, unless they adopt it by perpetuating the arguments.

Cheers, IFG

[IFG]

Hi, Don. A couple of points...

Re: "How much of taxpayer dollars, through CP Ltd, went to CPA can be academically discussed" - Could you elaborate?

While it's true that CPA had its own benefactor in the CP 'empire', they were private pockets, ie not those of your parents and mine which ultimately funded the governments of those days. Nor do your references from Pigott's book deal in any way with the alleged favouritism in regulation, route approvals etc., a form of nurture unavailable to the likes of Crump or Sinclair. That is a 'rabbit trail' for now tho'.

Rather than trying to masquerade AC's pre-1988 history as a commercially successful one, I think your point about its existance as an instrument of public policy is well said. I'd add that it's also something for the operational folks to take great pride in, of pioneering work professionally done. Whatever political or commercial shenanigans may or may not have been undertaken, at the corporate level, to massage the economics of the enterprise (but also making life difficult for anybody attempting to earn their own living in air transport), those people and their successors certainly don't hold responsibity for them, unless of course they adopt it by perpetuating arguments about them.

Cheers, IFG

[Don Hudson]

IFG;

Re ". . . a form of nurture unavailable to the likes of Crump or Sinclair."

Not entirely. A lot of back and forth happened with route rights and competition as far back as the 50's. There are many books on the subject and all acknowledge the run which the CP organization gave TCA and the government and there were exceedingly clever business ploys put together by both leaders, but notably McConachie. In fact, those at TCA always lamented the "division of the world" decision taken so long ago and it carried CPA a long way in its private enterprise approach and Asia was never available to AC until very late and only then, as a result the Gemini-hosting "solution" and even then, only Osaka.

And the mandate was to not lose money for the taxpayer so in that sense, the story of TCA/AC was a successful one with the exception of a couple of years, (1976 being one if I recall).

Yes, its a rabbit trail! Goes on forever and the story could have been quite different but for the idiocy which has consistently and interminably occupied the Transport Ministry's office since the 70's, a trail of failures which has singularly re-defined the notions of equivocation, caution and sucking-while-blowing. Our industry's mess is their collective legacy.

Cheers, IFG

Don

[DEFCON]

The technical component (maintenance) of an airline is a factor for me. AC has always had a first rate "fix it or don't fly it" type attitude which is contrary to the "mail must go" attitude of others. The AC attitude is an expensive method of doing business and is one big reason that it has difficulty competing today. When it comes to TC's oversight of the industry...I could puke!