YVR Airport & Sea Island Developments Discussion

[ACT7]

Originally Posted by Gordon

Vancouver is still the 4th largest Asian Gateway behind LAX SFO and I think
JFK

Yes, but as I mentioned, Asian pax traffic has been more or less stagnant since 2002. YVR should be in the top five for Asia Pacific traffic simply by virtue of its location. The trouble is that the gap is widening between it and the other 3 aforementioned airports, and the gap is narrowing between it and other hubs with growing Asian traffic.

[mezzanine]

Remeber most of the near-term construction projects are not for terminal expansion, but for infrastructure upgrades (roads, runway visibility systems, baggage upgrades) and north runway/tempelton business park development.

a lot of their near-term political capital will be spent trying to pass the YVR pipeline plan.

I agree that the need for gate expansion isn't there now.

[PaperTiger]

From Berg's comments in the G&M article, it seems that these improvements are as much about maintaining market share as they are about growth. I agree that the terminal itself seems plenty large enough to handle the volumes anticipated.

[s211]

Originally Posted by ACT7

I personally think that YVR and YYC are embarking on projects that are way over the top for their market size.

Loved your comments, and couldn't agree more with your summary. YVR seems to think it can punch above its weight, but it's weight is lower than what it thinks it is. And YYC? Are they trying to become the Alberta International Airport?

[ACT7]

Originally Posted by s211

And YYC? Are they trying to become the Alberta International Airport?

Looks more like they're aiming for Western Canada International Airport.

[trofirhen]

Originally Posted by ACT7

I personally think that YVR and YYC are embarking on projects that are way over the top for their market size.

Well, trying to look at the bright side ... IF Vancouver and Calgary ever really do become larger, more desirable air destinations with concommitant larger economies, the airport infrastructure will already be there, and there will be no last-minute scrambling to build additional facilities. ...

[whatnext]

What a shrewd strategy from YVR to stop their traffic bleed to BLI and SEA, raise their airport improvement fee.

Maybe they should survey all the travellers defecting to those airports as to how important new couches or artwork is to them.

[ACT7]

Originally Posted by trofirhen

Well, trying to look at the bright side ... IF Vancouver and Calgary ever really do become larger, more desirable air destinations with concommitant larger economies, the airport infrastructure will already be there, and there will be no last-minute scrambling to build additional facilities. ...

There's always a silver lining

[mezzanine]

Originally Posted by whatnext

What a shrewd strategy from YVR to stop their traffic bleed to BLI and SEA, raise their airport improvement fee.

Maybe they should survey all the travellers defecting to those airports as to how important new couches or artwork is to them.

Larry Berg seems to be concerned about the intl transfer traffic to western canada.

i don't think people will change to fly out of SEA/BLI for a $5 increase in fees. They will fly out of SEA for $100s in savings, which is mainly due to factors outside of YVR's control.

[jlousa]

My understanding is the $5 AIF increase is being offset and passengers should acutally save money. They are freezing the landing fees already quite competive with other airports. (hint compare our landing fees to Torontos) I also beleive they are removing a provincial fuel tax which should save the airlines much more then $5 per head. The theory is it'll attract additional flights to YVR. How this all plays out will remain to be seen.

Personally I think YVR should still team up with Translink and offer free transit on the date of your flights.

[cornholio]

trofirhen nailed it I think when he said planes have no problem simply overflying YVR.

I think people place to much importance on the location of YVR as the furthest north west major airport in north America.

With the efficient use of a hub system being the norm now, YVR no longer has a geographical advantage, if I would have to take a guess I would lean towards saying it has a geographical disadvantage now. The problem is it is too far north west and cant take advantage of north American domestic flights to the extent airports further inland can. For a airport to be successful going forward imo it will need to be centrally located for both international flights and domestic flights, and YVR is not well located for the later.

Vancouver is a small market, even Seattle and such, for many flights it will simply be better and more cost effective to have passengers going to these destinations overfly them and then backtrack from the HUB airport.

I personally think that Calgary, Denver, etc. have a much better future with their airports.

[trofirhen]

Thanks for the support, cornholio.
And yes, I'd even go so far as to say we are DISadvantaged geographically in many regards.

But not entirely. Here in Paris, people I know who fly to the South Pacific (Papeete, or New Caledonia) usually go through Los Angeles on the way there.

I'll have to check my great circle route mapper, but I think It sould be shorter for them with a YVR stopover, rather than LAX.

And of course, Sydney, Melbourne, and Auckland are more in our range than is Toronto. Trouble is, from where Vancouver is, most destinations are to the south or east. Westward ...... well, there is SO MUCH Pacific Ocean out there.

[deasine]

I think geography as a comparative advantage is much more of a historical line of thought and only comes into play in certain specific conditions. Historically, when planes don't have the long ranges that they do now, geography is absolutely critical as planes only have a certain distance that fly to. I argue that Tokyo's and Anchorage's presence in the aviation world is because historically, these were cities that planes needed to stop for fuel. And unlike Tokyo, Anchorage did not have much demand as a final destination city, but was an incredibly busy airport back then due to its geographical significance. And today, while passenger services are much lower at Anchorage than they were before, Anchorage is still the fifth busiest airport in terms of cargo flights and I reckon this is due to the fact that old legacy carriers had set up base at Anchorage.

With even higher extended ranges at airplanes now (introduction of 787 for instance) and FAA approval of ETOPS for existing airplane infrastructure (see feature map article: http://www.gcmap.com/featured/20111220), geographical barriers are really being taken down around the world now.

What makes geography a real comparative advantage is when connections are involved. Vancouver may not have the demand as a final destination, but it may have the demand in terms of as a connection city. But this only works when there is interest developing a hub-spoke network from carriers and economic conditions (costs, supply and demand) favor the city hub. There's a lot of talk on this forum how Air Canada favours Toronto, but they are doing so as a result because demand in Toronto is much higher than demand in Vancouver. Plus, in terms of Asia-Pacific travel for passengers originating from the East Coast, Vancouver is not necessarily positioned in a location with a comparative advantage. Vancouver is only good for cities on the West Coast, but Los Angeles and San Francisco already have more direct-flights to Asia than Vancouver. What could make Vancouver more favorable is for smaller carriers who may not be able to logistically deploy resources to two cities, but can use Vancouver as a hub-and-spoke and have passengers make connections. But this relies on carrier-to-carrier cooperation, and the Canadian Aviation Market really only has two carriers: WestJet and Air Canada, which makes it limiting. Star Alliance carriers would partner with Air Canada, and other carriers would be with WestJet, but WestJet's ability (i.e. failure to capture regular travellers to the US from/via Canada) is still limited in this regard even though it has made great strides in providing feeder services.

And while many seem to be questioning Calgary's expansion plans, keep in mind, Calgary has an airline that's based there: WestJet. Air Canada has a hub in Vancouver, yes, but most of its services are focused on the East Coast. Vancouver is not a hub for WestJet, only a focus city, and I don't think this will ever change unless Vancouver's demand grows significantly to demand for a hub status, but then I'm sure Air Canada would also be reacting. Plus, Calgary is growing and likewise, its demand is also growing. And while WestJet seems like a national carrier now, they are really seriously looking into expanding its network significantly within the next decade. Next up in the horizon is to grow its regional traffic network to compete with Air Canada Express, and unlike before, WestJet has publicly announced its intentions to become an international carrier. This can significantly change Vancouver's ability to become the Western Canadian-Asian Pacific Gateway, given that many carriers are partnering with WestJet, relying on its feeder network. Vancouver's demand for Asia-Pacific destinations is still larger than Calgary's, but it's a matter of time that the demand levels equate to one another.

So essentially, I think the ability for Vancouver to remain Canada's Asia-Pacific hub and keep current carriers and attract new carriers is our ability to increase demand as a final destination, and this really rests on the shoulders of Provincial and Federal Governments and their ministries, not really on the Airport Authority or the city. What the Airport Authority is and will be doing is controlling its share to attract carriers: lowering costs (in this case, passing them on to consumers) and improving its facilities.

---

On a side, but related note, I actually think Finnair could eventually fly into Vancouver. Helsinki does present a big geographical comparative advantage over existing carrier hubs in Europe. London, Paris, Amsterdam, and Frankfurt are all far Westward, but Helsinki seems to be in the centre between Europe and Asia, and Finnair is leveraging Helsinki's location in its strategy to attract demand between Europe and Asia. I see Helsinki is also a strategic location for a focus of travel between North American West Coast Cities and Central Asia/Gulf States.

Currently, there are no non-stop routes directly between India and North America that are profiting. Air India flies nonstop to North America, but do note that none of the routes are making any money. American Airlines, with a rather large presence in Chicago, announced an end to their Chicago-New Delhi route because of the lack of profits despite having high load factors. It really comes down to cost of operation, and I suspect that demand between North America and India, were routes catering to specialized markets (specialized since passengers connecting in North America stay in North America, likewise passengers connecting to India stay in India, as opposed to markets like Thailand, Gulf States, Hong Kong, China, and Japan), haven't reached adequate levels where this is feasible (and the relative operation costs are still yet too high). This is why airlines like Cathay Pacific, China Airlines, China Southern, etc. have routes through other cities. Even Jet Airways, which operates direct-flights to Toronto and New York, fly through their European hub Brussels, before going to New Delhi.

How is this related to Vancouver (West Coast Cities in general) and Helsinki? Well since there is unlikely a direct service to India given the success (or lack of) between North America and India, this means passengers who want to fly between these markets must rely on transit carriers. Well in Vancouver, transit carriers are identified to be China Airlines, Korean Air, and Cathay Pacific for Asia side, and British Airways and Lufthansa in Europe side. It so happens that Helsinki is the shortest via connection point between other carriers.

ASIA:
Via Cathay Pacific: 2 segment path:			 8723 mi 
    YVR (49°11'38"N 123°11'04"W)	HKG (22°18'32"N 113°54'53"E)	309.1°	 (NW)	 6392 mi
    HKG (22°18'32"N 113°54'53"E)	DEL (28°34'07"N 77°06'44"E)	288.4°	 (W)	 2331 mi
Via China Airlines: 2 segment path:			 8692 mi
    YVR (49°11'38"N 123°11'04"W)	TPE (25°04'40"N 121°13'58"E)	305.1°	 (NW)	 5971 mi
    TPE (25°04'40"N 121°13'58"E)	DEL (28°34'07"N 77°06'44"E)	285.2°	 (W)	 2721 mi
Via Korean Air: 2 segment path:			 8004 mi
    YVR (49°11'38"N 123°11'04"W)	ICN (37°28'09"N 126°27'02"E)	309.2°	 (NW)	 5108 mi
    ICN (37°28'09"N 126°27'02"E)	DEL (28°34'07"N 77°06'44"E)	272.8°	 (W)	 2896 mi

EUOPRE:
Via British Airways: 2 segment path:			 8914 mi
    YVR (49°11'38"N 123°11'04"W)	LHR (51°28'39"N 0°27'41"W)	34.4°	 (NE)	 4723 mi
    LHR (51°28'39"N 0°27'41"W)	DEL (28°34'07"N 77°06'44"E)	80.0°	 (E)	 4191 mi
Via Lufthansa: 2 segment path:			 8836 mi
    YVR (49°11'38"N 123°11'04"W)	FRA (50°01'35"N 8°32'35"E)	30.2°	 (NE)	 5025 mi
    FRA (50°01'35"N 8°32'35"E)	DEL (28°34'07"N 77°06'44"E)	85.6°	 (E)	 3812 mi

HELSINKI:
Via Finnair: 2 segment path:			 7928 mi
    YVR (49°11'38"N 123°11'04"W)	HEL (60°19'02"N 24°57'48"E)	16.4°	 (N)	 4679 mi
    HEL (60°19'02"N 24°57'48"E)	DEL (28°34'07"N 77°06'44"E)	108.4°	 (E)	 3249 mi

(Distances Calculated by GCMAP [see diagram])

And given that there are few direct flights to Europe, there is an emphasis placed on connections between Vancouver to Europe markets. Naturally, the connection points in Vancouver would be Toronto and Montreal (via Air Canada/LOT/Swiss/Air France+WestJet), Frankfurt (via Lufthansa), London (via British Airways), and Amsterdam (via KLM). Aside from Toronto and Montreal, as indicated, there are many other large cities in Europe that don't have a direct connection to Vancouver nor is there really a demand for additional direct routes (Paris example). So a Vancouver-Helsinki route can also attract the segregated Europe-Vancouver markets. Take Paris as an example:

Via Air Canada: 2 segment path:			 5836 mi
    YVR (49°11'38"N 123°11'04"W)	YYZ (43°40'38"N 79°37'50"W)	83.7°	 (E)	 2085 mi
    YYZ (43°40'38"N 79°37'50"W)	CDG (49°00'35"N 2°32'52"E)	53.3°	 (NE)	 3751 mi

Via British Airways: 2 segment path:			 4940 mi
    YVR (49°11'38"N 123°11'04"W)	LHR (51°28'39"N 0°27'41"W)	34.4°	 (NE)	 4723 mi
    LHR (51°28'39"N 0°27'41"W)	CDG (49°00'35"N 2°32'52"E)	140.8°	 (SE)	 216 mi

Via Finnair: 2 segment path:			 5860 mi
    YVR (49°11'38"N 123°11'04"W)	HEL (60°19'02"N 24°57'48"E)	16.4°	 (N)	 4679 mi
    HEL (60°19'02"N 24°57'48"E)	CDG (49°00'35"N 2°32'52"E)	238.6°	 (SW)	 1181 mi

(Distances calculated by GCMAP [see diagram])

While the fastest route (assuming perfect connections) between Vancouver and Paris are using British Airways, which will be similar to Lufthansa and KLM via their respective hubs, notice that Finnair via Helsinki is essentially the same as Air Canada via Toronto. The advantage is more obvious in Scandinavia and in Eastern Europe destinations. So if priced and marketed right, the route should take a small share of everyone's pie right now. With some of the India Market plus some of the Europe Market, I think this may be a future route worthwhile exploring.

[mezzanine]

^agree.

Building infrastructure to make transfers easy will have benefit now as westjet IIRC codeshares with cathay and JAL making it more seemless.

[Denscity]

Dont agree with one of those points. Calgary's demand for asian destinations will never catch up to Vancouvers. Vancouver has a way larger asian population and despite incredible growth in calgary, vancouver is still twice the size.

[ACT7]

Originally Posted by Denscity

Dont agree with one of those points. Calgary's demand for asian destinations will never catch up to Vancouvers. Vancouver has a way larger asian population and despite incredible growth in calgary, vancouver is still twice the size.

I would agree with that too. The oil industry is not enough for YYC to overtake YVR for Asia Pacific traffic. There may be a little poching here and there but you're not likely to see an Asian carrier (or AC for that matter) opt for YYC over YVR as a first destination to or from Asia.

I do think that pretty much every other point that deasine made is a good one. Although, I would say that even though Westjet can serve as a decent feeder airline and they have made their intentions known that they would like to become an international carrier, they are more likely to go head to head with AC out of YYZ first, imo. I also don't believe that simply because their corporate office is in Calgary that that necessarily means they will continue to develop YYC as a hub over YVR if the market conditions aren't right. My guess is that setting up corporately in Calgary had more to do with taxes and the fact that Calgary is more of a head office city than Vancouver. That being said, they have been able to develop a strong domestic hub out of YYC over the years but even their focus has shifted more eastward where the population and the more lucrative demand is. I mentioned in the YYC thread that as much as AC has technically and publicly declared YYC as a hub, it is predominantly a domestic airport with some international connections. In fact, based on pax numbers alone, it has a higher count of domestic pax than YVR. But I digress...

I do think YVR's challenge will be to attract 'hubbing' from AC. Whether that is actually doable remains to be seen. As I also said earlier, Asia-Pacific traffic has been more or less fllat since 2002, so what that tells me is that any new carrier over that time period has simply had a redistribution effect of that segment. LAX and SFO are both true United hubs, much larger markets (tourist and business), and obviously much larger economies in general, so its almost a non-starter to compare. The only similarities is that they are on the west coast. YVR has its work cut out for it, no question.

[Hot Rod]

ya, I think some people are getting way over carried-away here with YVR. Sure, Seattle picked up some flights, but that was more to Delta chosing to elevate SEA as a focus city given SEA's position as the US's closest city to Asia; companies actually have cut back on travel and particularly with the advent of the internet, there isn't a flood of corporate travel originating from SEA. It was a natural move, since YVR is Star Alliance and SEA wasn't anything until the Delta merger with Northwest.

Vancouver ONLY shot itself in the foot (or the government of Canada) with respect to Air France and Emirites. But again, this made more sense from a Delta/SkyTeam point of view to use SEA than to set up shop in a 'hostile' Star Alliance fortress that is Canada-Vancouver. Just because YVR doesn't have non-stops to CDG year round isn't the end of the world. Notice how Air France no longer serves the SEA-CDG route and I believe the flight is A330 service and may not be daily anymore.

In some respects, I think it is nice to have two major airports (3 if you count Portland) so close. One with definitely an international edge (being Vancouver) and the other with the US domestic edge (being Seattle).

Trof - relax, despite Seattle picking up flights (somewhat naturally) - SEA is no comparison when it comes to International flights. Also keep in mind, in the US we dont distinguish between transborder and 'international' like Canada does. We would call transborder + international = international. Keep that in mind when you see SEA's roughly 1M pax a year in Int'l vs. YVR's 12M if I recall correctly. ???

Can YVR do better, YES. Should YVR do better, YES. It has nothing to do with corporate hq; Air Canada needs to better facilitate its Star Alliance hub in YVR and YVR needs to work with foreign flags to get more flights (which it has with China Southern, Air China expansion, and so forth).

[trofirhen]

Originally Posted by ACT7

I do think YVR's challenge will be to attract 'hubbing' from AC. Whether that is actually doable remains to be seen. As I also said earlier, Asia-Pacific traffic has been more or less fllat since 2002, so what that tells me is that any new carrier over that time period has simply had a redistribution effect of that segment. LAX and SFO are both true United hubs, much larger markets (tourist and business), and obviously much larger economies in general, so its almost a non-starter to compare. The only similarities is that they are on the west coast. YVR has its work cut out for it, no question.

Good point, ACT7. My question to that would be: "Vancouver hubbing? From which points into Vancouver, and bound to/from which destinations?"

Originally Posted by Hot Rod

Vancouver ONLY shot itself in the foot (or the government of Canada) with respect to Air France and Emirites. But again, this made more sense from a Delta/SkyTeam point of view to use SEA than to set up shop in a 'hostile' Star Alliance fortress that is Canada-Vancouver.

Regarding the Star-Alliance fortress, I think that this is also a real chain on our ankle. We have to not upset or anger the other Star Alliance partners - most notably Lufthansa - and this limits, or at least has limited - who will fly here. I wish YVR could get ut from under that, but I doubt it'll be able to.

[ACT7]

[QUOTE=Hot Rod;5566205]YVR's 12M if I recall correctly. ???

No, YVR has roughly 8 MM pax per year of 'int'l' traffic and that includes transborder.

I don't really have a thought as to which destinations could be derived from active hubbing at YVR - I'd have to think about that one. It was more of a general comment on the ability to grow an airport's traffic. The trouble is the sparce relative population in Vancouver's chachement area compared to the GTHA. With the latter, you have roughly 100 MM people within a 2-3 hour flight of your hub. YVR simply does not have that advantage so it would be difficult to force a true hub there.

[whatnext]

Larry Berg and YVR were certainly taking it on the chin in the media from ordinary travellers yesterday. Like many said, its death by a thousand cuts, $5 here, $5 there, with YVR funding their int'l plans on local backs. Many said they would look to flying out of the States or Abbotsford instead.

On the other hand, Air China just annoucned they will increase flights to YVR:
http://www.news1130.com/news/local/artic...ine-plans-to-double-service-to-vancouver