Quote:
Originally Posted by CareerShow
Yes i completely agree with all of that. However I don't see how this stance conflicts with the fact YVR was widely neglected by AC for about a decade before the last two years. It seems apparent YVR could support more routes then it was supporting for years. I don't think the demand for travel to the aforementioned 10 cities happens overnight, which means whether or not it is AC, the Federal government, or other carriers, YVR was certainly under utilized for years. It also appeared AC and the Federal government blocked numerous airlines inroads into western Canada in order to protect AC from competition. Don't know the full fact pattern on this one.
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I don't think AC and/or the Federal Government's blocking of various airlines was necessarily targeted at Western Canada. In fact, one can argue a lot of what they have blocked has helped them in the East. Examples of course are the ME3 by restricting the number of frequencies into Canada as a whole. I don't want to drag this up too much again as it has been discussed ad nauseum (like many topics on here!). But AC and/or the Federal Gov't were "protecting" their hub at YYZ mainly as allowing more access into YYZ would have a big impact on some of AC's routes to Europe. The statements made by Emirates (in particular) about YVR and YYC was most likely just a political game to encourage lobbying out west when their main intention was more access to YYZ. That is just my opinion but absolutely if AC has the power to lobby the government to protect its business? Of course it would but in as private a way as possible so it doesn't appear it is favouring one region over the other. It is more of favouring the protection of a global hub that is still developing.
The most recent alleged blocking is of course the latest round of China-Canada bilaterals. China wanted more access but allegedly AC lobbied against the increase as clearly the increase in Chinese airlines access to Canada would have a big impact on AC services. This affects every airport in Canada and not just YVR. Clearly most of the new services by Chinese airlines have targeted YVR but that is certainly not to say there were other routes being pursued. Now, due to the cap not being raised, growth will be at a standstill for at least two to three years unless talks somehow schedule earlier.
As for the current 10 cities where the demand appeared to have occurred overnight... each route would be analysed on a constant basis and with ever changing market conditions and forces the NPV of running the numbers may have been very close to being positive for many routes. Then all of a sudden with the conditions right, many routes may tip into positive territory with just a change in one or two factors. So I still stand by my opinion that based on the allocation of resources model, that's why we have seen so much so quickly. The conditions are NOW strong enough for these increases to occur.
This is what is happening now with YVR-SIN and YVR-BKK (among others
) AC is apparently still pursuing these routes with their forecasting models. There must be some credence to the numbers for them to be looking so closely. However, if the conditions keep coming back with a negative NPV, they won't be launching. There will be a minimum benchmark they would have... if this is met and the aircraft is available, then it's a go.
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