YVR Airport & Sea Island Developments Discussion

[Genauso]

North Pacific airline route development: Part 1 - Market growth and the Asian airlines' strategies
CAPA > Aviation Analysis > North Pacific airline route development: Part 1 - Market growth and the Asian airlines' strategies
18th August, 2014
An in depth article, establishing the current stage while setting up for the next part which will go into the political aspect of visas and airline flight freedoms.

Canada to NE/SE Asia (seats per week, one way): 19-Sep-2011 to 8-Feb-2015

source: CAPA - Centre for Aviation and OAG @ http://centreforaviation.com

For context,
US to NE/SE Asia (seats per week, one way): 19-Sep-2011 to 8-Feb-2015

source: CAPA - Centre for Aviation and OAG @ http://centreforaviation.com

Summary, aviation in Asia might be the biggest thing going and the trans-Pacific routes have a lot of potential for more growth/competition/efficiency.

[Johnny Aussie]

Love these photos this guy takes at YVR. Shows a fairly decent but just a fraction of the variety of the aircraft / airlines serving YVR.

http://twitter.com/yvrairport/status/501873901962424321/photo/1

[Hourglass]

Interesting new article from CAPA that highlights the contrasting approach between Canada and the US when it comes to liberalization.

http://centreforaviation.com/analysis/no...ersion-and-canadas-restrictionism-182041

Also includes a brief blurb about YVR's opportunity. Nothing new but a good recap nonetheless.

[Klazu]

Originally Posted by Johnny Aussie

Love these photos this guy takes at YVR. Shows a fairly decent but just a fraction of the variety of the aircraft / airlines serving YVR.

http://twitter.com/yvrairport/status/501873901962424321/photo/1

Haha, that's indeed an ingenious photo. Love it!

[trofirhen]

Originally Posted by Hourglass

Interesting new article from CAPA that highlights the contrasting approach between Canada and the US when it comes to liberalization.

http://centreforaviation.com/analysis/no...ersion-and-canadas-restrictionism-182041

Also includes a brief blurb about YVR's opportunity. Nothing new but a good recap nonetheless.

With good ol' Calvin Rovinescu ready to pour water on YVR's fire.
As you say, nothing new, but still an example of tight-assed Canadian restrictionism (NOT talking about the Gulf Carriers)

[Johnny Aussie]

JAL has been granted approval by the CTA to slap its codeshare flight numbers on Westjet transborder flights.

https://www.otc-cta.gc.ca/eng/ruling/311-a-2014

Should help provide a few Japan-US connections via YVR.

[Genauso]

Originally Posted by Genauso

North Pacific airline route development: Part 1 - Market growth and the Asian airlines' strategies

North Pacific air route development: Part 2 - US airlines’ risk aversion and Canada's restrictionism
CAPA > Aviation Analysis > North Pacific air route development: Part 2 - US airlines’ risk aversion and Canada's restrictionism
22nd August, 2014

...
As Vancouver Airport's then-newly appointed CEO Craig Richmond, formulated the proposition on 23-Oct-2013: "BC (British Colombia) does not have the market size to support a simple back- and-forth service between Vancouver and cities such as Xiamen, Wuhan, and Hangzhou. But if Vancouver serves as an intermediary point between China and cities in the US and South America - that combination of markets makes a service viable. Our goal? We want to be China’s connection to all the Americas. Open up the market and we’ll bring jobs. We’ll create routes for B.C. cherries to reach Santiago. We’ll bring opportunities for mining companies to fly directly to their sites. And this is not a pipe dream: we have airlines lined up to fly between China and Latin America. Why? Because from any point in western Latin America, flying through YVR is the shortest route to Asia."

Air Canada CEO Calin Rovinescu disagreed, saying, (as reported by the Vancouver Sun): “Lately, there have been lively discussions on more ‘Open Skies’ policies ... and many believe that it will bring more airlines, more routes, more jobs, and nirvana for all...To me, that is a solution in search of a problem.”

Mr Rovinescu argued Canada needs strong local carriers to build hubs, and liberalisation risked that evolution. But Asian carriers will continue to be able to offer many more flights than Air Canada ever can. Qantas is an example of a carrier that has pulled down loss-making international routes to focus on its domestic market, which until a recent capacity war was handsomely profitable. Visitor arrivals have grown significantly, benefitting Australia and its major airports.

So long as Canada chooses not to give "nirvana for all", the indirect beneficiary is the US. Of six key Asian markets, the United States has open skies or very liberal agreements with five. In the sixth, China, Chinese carriers use less traffic rights than their US peers, meaning the US is not capping the growth of Chinese carriers, unlike in Canada.
...

BEGIN FAMILIAR RANT:

I completely understand why Air Canada, or WestJet after they upgrade their fleet, would hesitate to expand Vancouver flights and fight to keep others from doing the same. Rovinescu is merely trying to maximize profits of the market he knows exists, yesterday's market. There's been a lot of that throughout Canadian history, and it's the easiest path.

For context, Canadian Pacific / The Family Compact fought in all manners bureaucratic and illegal to use Ottawa to block the tolled private Lion's Gate Bridge and development of The British Properties which later became West Vancouver. They wanted to squeeze every penny out of their current land sales in Vancouver without competition interfering. Any extra money they did earn from excluding competitors is insignificant as seen from the perspective of today. That understandable tendency to lock in a good profit with no chance of loss enabled by the centralization of land/money/power in Canada relative to the United States is the main reason for the divergences in the two countries development.

Air Canada may be the envy of Europe today, given that airlines and airports there are very expensive for their governments to sustain and that won't end until someone gives up. But, in just about every possible future Air Canada will only fall down the rankings. If they want a chance to grow and survive in relevance -- to its partners and suppliers as well as customers -- they need to be willing to give up their safety blanket of avoiding change.

• I would support them if they campaigned on ending the indirect federal taxation for airport leases, especially given that the land in some cases was essentially stolen in the last century and they've put nothing into it as NavCanada and security are paid separately with passenger fees.
  
• I would support them in avoiding competition from any foreign carrier that might just flood the market with seats only until they crush domestic carriers.
  
• But I can't support them blocking the transit visas to allow flights from Asia to South America (and they seem to be unnamed opposition)

Part of the reason for the disharmony here is that Canada is not really one airline market, the western and eastern ends are worlds apart with loosely connected flights. It would be helpful if the Canada could be 2 or 3 countries when negotiating flight freedoms.

Even if we were all united and wanted to, we still can't stop change. Maybe robots halve the costs of European airlines, Air Canada can't afford to match at their smaller size, and those flight access agreements backfire. Maybe southern Africa and South America grow in population and wealth and become much bigger airline markets like Asia is today, and they carve new patterns that just go around and exclude Canada. Maybe there is some other political or technological change that eliminates Air Canada's gifted international advantage and they simply no longer have a role to play or the means to adapt.

It's too easy for me to criticize Air Canada, expected almost. They've almost gone bankrupt along with Aeroplan in recent memory, and that's not because they performed poorly. But when they're asking the general public to say no (eg to Craig Richmond's pragmatic overtures), have they even offered any alternative vision for the future or committed to a strategy for us to trust in?

[Johnny Aussie]

^ they may want to revisit their comparisons to Australia.

This article has very lightly touched on some of the issues facing us here. But it goes way deeper than that.

What perhaps was once the darling of the aviation world... How quickly things can change.

Just look at what has just transpired over just the last weeks...

Qantas about to announce a billion $ loss, Jetstar rumoured to take over many international routes. Virgin also most likely to report record losses (almost a guarantee). QF is shoring up on its probably only profitable area.. The USA.
Air Asia X lost $32M on its Australian operations in 2Q 2014. Domestically, Tigerair bleeding red ink faster than Niagara Falls, Virgin and Qantas stopping all expansion due to plummeting LFs. SQ pulling A380s due to over capacity. Thai load factors plummeting and cutting flights (also due to the political unrest of course!). And on and on and on...

In conclusion while Australia just opened the flood gates wide and QF got into bed with Emirates. Qantas has just suffered so harshly that most likely EK has gotten exactly what it wants at QF's expense.

Fantastic for the consumer in the SHORT term, but guess what.. THIS IS NOT SUSTAINABLE and airlines are now slashing capacity left right and centre.

Very gloomy dark skies here ATM and our two local carrier (groups) are in absolute turmoil. And I really do try the glass half full approach. So perhaps AC, Canada in general may want to see what is happening here.

The Canadian and Australian markets are similar (not identical) in size and have their own unique positives and negatives. One of our perceived positives, in this case, we don't have a country of almost 320 million people on our doorstep. However, we are a very small market but sometimes people think we are just this massive market with infinite possibilities... Our weaknesses are now showing evidently.

I am a free enterpriser, business owner and frequent traveller, but sometimes protectionism has a small (focus on small) role for the greater good of society.

[trofirhen]

Originally Posted by Genauso

It's too easy for me to criticize Air Canada, expected almost. They've almost gone bankrupt along with Aeroplan in recent memory, and that's not because they performed poorly. But when they're asking the general public to say no (eg to Craig Richmond's pragmatic overtures), have they even offered any alternative vision for the future or committed to a strategy for us to trust in?

No, they have not, and there's the enormous lack of plausibility that Rovinescu and associates brings to us, along with a shaken faith in Canada's airline development strategy. Hardest hit would be YVR (followed by YUL, already very limited on transborder routes, for example). They have taken several very optimal and pragmatic ideas, and shot them down with "straw man" arguments.

[DDP]

Originally Posted by Johnny Aussie

^ they may want to revisit their comparisons to Australia.

This article has very lightly touched on some of the issues facing us here. But it goes way deeper than that.

What perhaps was once the darling of the aviation world... How quickly things can change.

Just look at what has just transpired over just the last weeks...

Qantas about to announce a billion $ loss, Jetstar rumoured to take over many international routes. Virgin also most likely to report record losses (almost a guarantee). QF is shoring up on its probably only profitable area.. The USA.
Air Asia X lost $32M on its Australian operations in 2Q 2014. Domestically, Tigerair bleeding red ink faster than Niagara Falls, Virgin and Qantas stopping all expansion due to plummeting LFs. SQ pulling A380s due to over capacity. Thai load factors plummeting and cutting flights (also due to the political unrest of course!). And on and on and on...

In conclusion while Australia just opened the flood gates wide and QF got into bed with Emirates. Qantas has just suffered so harshly that most likely EK has gotten exactly what it wants at QF's expense.

Fantastic for the consumer in the SHORT term, but guess what.. THIS IS NOT SUSTAINABLE and airlines are now slashing capacity left right and centre.

Very gloomy dark skies here ATM and our two local carrier (groups) are in absolute turmoil. And I really do try the glass half full approach. So perhaps AC, Canada in general may want to see what is happening here.

The Canadian and Australian markets are similar (not identical) in size and have their own unique positives and negatives. One of our perceived positives, in this case, we don't have a country of almost 320 million people on our doorstep. However, we are a very small market but sometimes people think we are just this massive market with infinite possibilities... Our weaknesses are now showing evidently.

I am a free enterpriser, business owner and frequent traveller, but sometimes protectionism has a small (focus on small) role for the greater good of society.

You are missing a big price of that puzzle and hate when people compare the two:
Australia has two system, one for Qantas, one for others. VA is owned by foreigners something Qantas can't do.
-Geography, emirites took over the kangaroo routes essentially. But why would Qantas do any better. They would still need to operate ULH routes to Europe with with fuel where it is few make those work.
-2009 economy, USA, Europe tanked traffic fell, hurt everyone.
- emirites took over Europe but why can't Qantas be profitable focusing on China, India, Latin America, USA se Asia, Africa -you know the other 5 billion people in the world Emirites won't fly.
-management, were they ready for modern era? Operationally? Was a380 the right pane or should they have banked on the 787 to be profitable business?

Also how are consumers doing in the Australlian market? Ae prices coming Down with more choice? Arnt people flying more? Last time I looked there is more traffic per person down there than up here. If a company loses but consumers win, is it really that bad?

I also think Canada gets too caught up in the protection attitude in all large business. If a country can find capital for an industry I think it should be opened up.

I'm someone who worked for AC (years ago), an airport authority and now an American consulting company in Canada. Sometimes it is much nicer working for a non protected company.

[Johnny Aussie]

Originally Posted by DDP

You are missing a big price of that puzzle and hate when people compare the two

But that is exactly what this article is doing! Bringing in a comparison to Australia!

I am presenting a different view point from an Aussie perspective.

Emirates, I am sure, is just wringing their hands with glee getting exactly what they want at QF's expense. Yes there is a different structure here but it's even bigger than that. I am in no way defending QF as a company but again there is more at play here.

Yes, of course the consumer is winning...in the short term... This is NOT sustainable. Great to flood the market and nobody makes money... Great concept. Adjustments are coming daily and the consumer is about to lose including more Aussie jobs lost. I am a shareholder of both companies and business is all about pleasing the shareholder and nothing else. That part I get.

So perhaps prevent this mess in the first place.

As a free enterpriser I like small government but sometimes and I emphasise sometimes and in a small way a bit of protectionism is important for the long term greater good in general.

Believe me Australia is VERY protectionist as well... Don't want people to know that but there is in certain industries to "protect us"... The next time our banana crops get ruined we will see that again. So we pick and choose which industries to protect like every other country.

[Genauso]

Originally Posted by Genauso

North Pacific airline route development: Part 1 - Market growth and the Asian airlines' strategies
CAPA > Aviation Analysis > North Pacific airline route development: Part 1 - Market growth and the Asian airlines' strategies
18th August, 2014

Originally Posted by Genauso

North Pacific air route development: Part 2 - US airlines’ risk aversion and Canada's restrictionism
CAPA > Aviation Analysis > North Pacific air route development: Part 2 - US airlines’ risk aversion and Canada's restrictionism
22nd August, 2014

North Pacific air route development: Part 3 - China's primary and secondary airport hubs evolving
CAPA > Aviation Analysis > North Pacific air route development: Part 3 - China's primary and secondary airport hubs evolving
25th August, 2014

No rants this time.

Unsurprisingly, nearly 80% of the route expansion across the North Pacific in the past five years has occurred at hub airports where behind gateway connections are readily available - although for various reasons those connections are not always accessible on the same terms to Asian carriers, even where they are partners of the North American airlines.

...

Average Daily Trans-Pacific flights from North American origin airport: 2009, 2014
Rank	Airport	2014	(Increase from 2009)
1	LAX	29	6
2	SFO	22	3
3	YVR	16	5
4	JFK	15	4
5	ORD	13	4
6	SEA	9	4
7	YYZ	8	3
8	DFW	5	3
9	DTW	5	2
10	EWR	5	0
11	IAD	4	1
12	IAH	3	2
13	ATL	2	-1
14	BOS	1	1
15	DEN	1	1
16	MSP	1	0
17	PDX	1	0
18	SAN	1	1
19	SJC	1	1
20	YYC	1	1
Source: CAPA - Centre for Aviation and OAG 
Note: Philippine Airlines LAS-YVR-MNL service listed only under YVR.

The Airbus 380s are losing money everywhere, and the pre-purchases of them have slowed down many carriers' plans.

(i) The role of the 787

The remaining nine net additional trans-Pacific flights are from a number of smaller cities, and it is no coincidence that four of the nine flights have been opened by the 787: Tokyo Narita-Boston/Denver/San Diego/San Jose. This gives credence to the 787's position as enabling new thinner markets to be opened.

CAPA previously looked at the 787 route network and found that about a fifth of 787 non-stop routes had not been flown prior to its introduction. Most 787 routes are replacing older, less efficient aircraft, as would be expected. Although this is a small sample, looking at new secondary routes and finding about half are made possible by the 787 further supports its position as likely to link new cities in future.

Average daily trans-Pacific flights from Asian origin airport: 2009, 2014
Rank	Airport	2014	 (Increase since 2009)
1	NRT	38	3
2	ICN	25	6
3	HKG	21	6
4	PEK	19	10
5	PVG	15	7
6	TPE	12	1
7	HND	5	5
8	MNL	3	0
9	CAN	2	2
10	KIX	1	0
11	NGO	1	0
12	BKK	0	-1
13	SIN	0	-2
Source: CAPA - Centre for Aviation and OAG 
Note: Chengdu Airlines CTU-SHE-YVR service listed only under SHE

And some information on incentives for airlines by Chinese airports as they continue to be focused on growth and market share

...
Beijing and Shanghai will continue to grow, no doubt. While reaching the end of its first phase of rapid growth, with the 777-300ER, Air China will resume faster growth once it receives 787-9s to reach thinner markets.

Forthcoming delivery of 747-8s will enable more growth, while later any top-up 777 order could fuel more growth.

Hainan Airlines expects to order more 787s to mount more North American services. Of the foreign carriers, American Airlines is interested in a Dallas-Beijing service.

Shanghai is probably about to surge
Shanghai is on the verge of a growth spurt as China Eastern over the next few years looks to deploy most, if not all, of the 20 777-300ERs it has on order to North America. Shanghai is replicating the incentives other Chinese airports – notably Chengdu and Chongqing – have offered to woo medium/long-haul services.

Shanghai, according to WCARN News, is offering RMB30 million (USD4.9 million) for a new international route over six hours in duration, RMB20 million (USD3.3 million) for a resumed service, and RMB10 million (USD1.6 million) for increased service on an existing route.

Also being a transfer hub is an objective, with Shanghai offering RMB5-50 million (USD0.8-8.1 million) for increased transfer traffic.
...

It's a good series of articles about trans-pacific flights, with some actual reporting. There\s more at the links.

So how about that, what are your thoughts about YVR being the HKG of the west = )

As hub to hub traffic fills out, and eventually starts to be pruned, what's the essential role for YVR to fulfil as secondary airports and markets develop in China, or as longer range aircraft upend the current order.
Currently it seems YVR's international flights are capped unless there are forthcoming quota increases by the federal government, and the connections to the southern hemisphere remain abysmal (just spend a few days making connections in Toronto and then London, as if those airports are the best service in the world to go out of your way for)

[Genauso]

I will also recall from Part 2

Status of Canada and US air service agreements to key Asian markets: Aug-2014

Canada
China (mainland) Chinese carriers using traffic rights. China will not expand.
Japan Japanese carriers under-utilising traffic rights. Japan will not expand.
Korea Open Skies (2009)
Hong Kong Hong Kong carriers using traffic rights, seeking more
Philippines In May-2014 doubled allotment from seven weekly flights to 14, likely still not enough for Filipino carriers
Taiwan Taiwanese carriers using traffic rights, seeking more

United States
China (mainland) US carriers using all main traffic rights, Chinese not
Japan Open Skies (2010)
Korea Open Skies (1998)
Hong Kong Passenger services very liberal
Philippines Generally sufficient for Filipino carriers
Taiwan Open Skies (1997)


Source: CAPA - Centre for Aviation

[trofirhen]

Thank you for posting all this.
I hope that it will cause all people who think YVR has the Asia connection "in the bag" to wake up and smell the coffee.

The Canadian governement is unlikely to make any moves unless it benefits YYZ, because that's where the air market is, and that's where the VOTERS are.

And South American connections from Vancouver? Calin Rovinescu and co will see to it that that won't happen!!

Hey, don't think I'm knocking YVR. I'd love to see it expand by a few key routes, but with the status quo, it'll never happen.

[dubsH]

I swear every time I enter this thread, I read about how the sky is falling, YYZ is the only hub the Canadian Government cares about, etc. etc.

All I saw in the posts that Genauso posted was that from the timeframe between 2009-2014, daily flights to Asia increased from 11 to 16 at YVR (in that same timeframe, YYZ went from 5 to 8). Only LAX on that list recorded more increases of daily flights to Asia than YVR. Nothing about that says anything about the Canadian government protecting YYZ at the expense of YVR or that the sky is falling and YVR will be the only airport to lose out as a result of the lack of air service agreement improvements.

I usually lurk (since 2005) and don't post much, but it certainly doesn't make me want to visit here as often every time I read about how YVR is a tiny airport that should get flights to Paris and South America. Yes, it may not be ideal for YVR with the current Air Canada hub structure (at YYZ) and it would be nice if YVR gets a few more flights elsewhere besides Asia. But if the sky was falling, I would certainly not expect YVR to be growing in the 7-10% rolling 12 months.

Rant over.

P.S. I will be at YVR next month and see if I can take a few pictures. Although it'll be at nighttime though so no birds.

[Valley_Refugee]

Originally Posted by dubsH

I swear every time I enter this thread, I read about how the sky is falling, YYZ is the only hub the Canadian Government cares about, etc. etc.

All I saw in the posts that Genauso posted was that from the timeframe between 2009-2014, daily flights to Asia increased from 11 to 16 at YVR (in that same timeframe, YYZ went from 5 to 8). Only LAX on that list recorded more increases of daily flights to Asia than YVR. Nothing about that says anything about the Canadian government protecting YYZ at the expense of YVR or that the sky is falling and YVR will be the only airport to lose out as a result of the lack of air service agreement improvements.

I usually lurk (since 2005) and don't post much, but it certainly doesn't make me want to visit here as often every time I read about how YVR is a tiny airport that should get flights to Paris and South America. Yes, it may not be ideal for YVR with the current Air Canada hub structure (at YYZ) and it would be nice if YVR gets a few more flights elsewhere besides Asia. But if the sky was falling, I would certainly not expect YVR to be growing in the 7-10% rolling 12 months.

Rant over.

P.S. I will be at YVR next month and see if I can take a few pictures. Although it'll be at nighttime though so no birds.

Yes, you just summed up this entire thread in 3 paragraphs.

Thankfully there are also some very good contributors who know what they are talking about and keep us informed of the developments at YVR.

[Johnny Aussie]

Originally Posted by Valley_Refugee

Yes, you just summed up this entire thread in 3 paragraphs.

Thankfully there are also some very good contributors who know what they are talking about and keep us informed of the developments at YVR.

Completely agree. I wasn't even going to bother... again... But yes the numbers paint a completely different picture as to what is being summarised as doom and gloom. YVR gained 5 additional daily flights from 2009 to 2014 and YVR flies to every city on the Asian list top 9 plus Shenyang and Chengdu. Actually that table seems to have some mathematical errors. CAPA is a great source of info but sometimes their reporting can be sloppy.

I won't JUST focus on population... But have a look at the North America list, YVR's position on that list, look at the other cities on that list and then say YVR is not well served to the Asia Pacific. Je ne comprends pas!

Nobody is going to argue there aren't going to be challenges ahead but come on YVR has, is and will continue to serve Vancouver very well.

Also... FYI... Taiwan is not using all their allotments, there are still 2 unused. They just recently concluded a much more liberal agreement that will allow even more through 2015. Yes Philippines just doubled their allowable. But the article thinks this isn't enough. Hello, they couldn't even make YYZ work nonstop? So where are these 7 additional frequencies going to go that won't be half empty? Philippines obtained the additional slots to go via YVR to JFK. Pending CTA approval. China - there is no restriction on any Chinese Airline starting additional flights to anywhere in Canada as long as there is not another Chinese Airline on the route already (Xiamen anyone?) I am also pretty sure CX could add flights to YVR if they wanted so that is not tapped out either. So even CAPA may want to check its facts. They could use a good editor I reckon.

[LeftCoaster]

YVR is the best airport a provincial backwater logging town like Vancouver could hope for!

[trofirhen]

Originally Posted by LeftCoaster

YVR is the best airport a provincial backwater logging town like Vancouver could hope for!

That's good news. What will YVR be like when Vancouver grows into a major, diversified, economic hub?

[Hourglass]

Originally Posted by LeftCoaster

YVR is the best airport a provincial backwater logging town like Vancouver could hope for!

Lol yup.

YVR is a great first impression for visitors to Canada. Nice change from the clinical steel and glass that characterizes most airport developments nowadays.