With all the talk about fundamentally changing the world in the wake of the pandemic, I would settle for getting back to normalcy.
Air travel is a good example. As I have written before we have made substantial progress in that area in the past 25 years across Atlantic Canada. Let’s not let a 16 month or so pandemic kill years of progress.
I realize there are two parts: 1) health of the airports and the transportation infrastructure and 2) health of the airlines and they are both very important.
Let’s not get distracted by the announcement this week from Air Canada. The company is responding to a steep drop off in demand. Are they doing the right thing? Who knows. I’m not the defender of the airline industry in Canada. It’s one of the most mercenary industries there is – and as long as there is competition – that can be good – but if we get to a point post-pandemic where only one airline is operating services to this region or to most of its airports – we risk going back in time.
We need to get back to Air Canada, WestJet, Porter nipping around and other low cost carriers lurking in the back – waiting to strike if the main provider decides to jack prices or cut service.
As for this idea that has been rebooted about a big airport in Sussex – I have said that I am not in theory opposed to it but I think in practice there will be way too much push back relative to the potential benefit. Further, if it means closing one, two or more airports while things are getting sorted out – we could be looking at years when large areas of the province will end 2+ hours’ drive from an airport.
Make no mistake folks, the next 2-3 years are huge for this province. We need to get our inward population flow back on track. We need a large scale increase in our international student population. We have more potential than ever to attract the mobile professional workforce. Our exporting companies will need to rebuild fraying relationships with clients through face-to-face interaction. Our residents are going to want to get out there and travel – Bahamas, Florida, Vancouver – etc. I believe there will be pent up demand.
All of this requires a good level of air transportation services. If we diddle around for a few years while everything gets sorted out we will lose momentum.
I’d put this issue higher on the government agenda.
Being asleep at the wheel is how we get steamrolled by other jurisdictions.
David – good insight as usual. My one push back would be the last thought -“ this needs to be higher on the government’s agenda”. While that may be true I also think this needs to be a higher priority for our business sector and leading business organizations who rely on access (in and out) as part of their own growth strategy. We need the business community leading the long-term sustainability and growth of our airline industry. If we continue to rely on government I’m afraid we won’t be act quick enough to ensure the industries survival in Atlantic Canada.
Thanks for doing what you do .
David,
As far as I’m concerned and for what it’s worth, the key sentence in your blog – that should be one of the top-priorities for the government – is this one: ‘We have more potential than ever to attract the mobile professional workforce’. This is where NB has the potential to offer a unique value proposition. On one hand, increasing international geo-political tensions combined with the current global pandemic is leading to a major upward trend of (national and international) people looking for safe and affordable places to live. Canada is known as one of the safest places to live in the world – best quality of life. Within Canada, NB is a one of the leaders (in terms of crime rates). NB is also known as the one of the most affordable housing markets in the country. On the other hand, NB is also known as a world leader in broadband infrastructure (in its urban centres in particular. NB is still the only jurisdiction in the world where its 3 major urban centres were all recognized as one of the Top-7 Intelligent Cities in the world! That’s pretty impressive for a jurisdiction of only 750,000 people!). In the ‘Plus’ column of the global pandemic is the fact that we now know without a doubt that many professional workers can indeed perform their work very efficiently from ‘home’. At a macro level, ‘from home’ these days means ‘a safe and affordable place to live, connected to the world’… and frankly, that sentence could be the slogan of NB. I’m barely kidding when I saw that ‘NB… safe, affordable and connected to the world’ could be NB’s slogan that can appear on our NB licence plates :). This is currently the most appealing and ‘unique differentiator / value proposition’ for NB. As importantly, it is also to me the best and most efficient way to grow our population (focusing on selling that value proposition to mobile professional workers and international students). And then, to get back to your point, I’m not worried too much either about the recent cuts in airline services. This is temporary, reflecting the current lack of ‘air traffic/demand’. Yet if our population grows in NB and people get ‘active’ again (when we’re back to normalcy), air carriers will come back.
On that note, I also agree with Mike Randall’s comment. Air carriers locate or relocate where there’s a demand for their services. If you’re looking for a sustainable ‘air service’ model, the government and all of us should focus on growing your population (by selling our unique value proposition above), and air services will come back… no doubt about it. To involve the government to subsidize air services when the demand is not there is not sustainable. That’s not where the government should invest taxpayers’ money. That’s a ‘top-down approach’ and history has clearly shown that this approach does not work. An organic, community-based bottom-up approach is the way to go here. My 2-cent… 🙂
Many have indicated that the industry needs more Govt subsidization, they use the examples of the roads for truck transport, the Govt subsidized ports for sea transport, etc. The need to hi-light the value proposition in Atlantic Canada, the far North or remote locations within Canada has been strengthened by the impact of the China virus on worker location flexibility. Air service is critical to the development of multiple regions in Canada. We have spent literally 100’s of millions of dollars as a nation through grants, forgivable loans and CIDA financing of major infrastructure programs around the Globe including airports, roads and others. We have to take a deep breath and understand that our way of life will be shifted in the wrong direction if we do not invest in air capability in our own country, capability begins at home. This does not necessarily mean that subsidization is the only answer. Taxes, duties, levies and fees represent an enormous cost to all transport sectors, this offers all levels of Govt an opportunity to reduce these costs while demanding that doing so will require the ongoing offering of existing or enhanced service location operations. A very specific economic modeling process looking at the value impact that air services has on the economy will show the relationship of growth to air transport access. If AC and WestJet and Porter pull back, then regional airlines will have to fill the void. The regulations should support this and when traffic patterns are back to pre-Covid levels, the majors will be prohibited from scooping up the most lucrative routes to the determent of the regional carriers. This in fact is a reverse model that the impacted Provinces and local govt’s could get behind. Transport safety and security, maintenance of facilities and the associated infrastructure have to be kept up to date if we are to attract foreign investment and growth. These costs will continue to be present whether one, two or more airlines fly and use them. Let’s not forget that there will be a plethora of airlines (US based and others) looking to provide services within North America and the routes may offer an opportunity to generate revenue from the sale of said routes (assets) through a bidding process similar to the sale of communication spectrum. We could go on for hours as to how we could modify the processes so that a viable air transport sector would benefit. Suffice to say we will need all of the creative, innovative ideas brought together by multiple players from many diverse sectors to get our air transport industry back on track. We do need air transport this is not even an debate, how it is financed and managed will be key elements in an alliance of thinkers but more importantly doers.