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November-December 2008

Happy Holidays from the staff of the Canadian Airports Council!

Canadian, International Traffic Drop in September/October

Preliminary Transport Canada traffic figures for Canada in September indicate that Canada is not immune from the international traffic declines already reported by international air carriers.

For the month of September, the biggest decline was on the trans-border market where enplaned/deplaned passengers were down 6.4% according to the department's monthly "Top 30 Airports" statistics. Domestic traffic was down 1.5% while overseas traffic remained stagnant at -0.6%.

For the year to September, traffic remained up for the year across all sectors. Overseas traffic remained up 8.5% over the same nine-month period in 2007 while domestic was up 3.1% and trans-border was up 1.6%.

The International Air Transport Association (IATA) this week announced global international traffic results for October. Internationally, passenger traffic declined 1.3% while cargo traffic dropped 7.9% compared to the same month in 2007. International load factors tumbled by 2% from August to 75% in September.

It is worth noting that the October declines were less pronounced than the IATA declines reported for September.

September marked the first time since the SARS crisis in 2003 that global passenger traffic has shrunk. Capacity cuts were not able to keep pace with the fall in demand.

Up to August, the drop in international passenger traffic was isolated to Asia-Pacific carriers.

International Cargo Decline Worst Since Burst of 2001 Technology Bubble

This is the worst decline since the technology bubble burst in 2001. Declines in air freight have slowed year-to-date (October) growth to 0.8%, with all regions except the Middle East and Africa reporting negative results.

The most alarming drop was with Asia Pacific carriers - the largest players in the market. The region's carriers reported a 11% decline in October. Europe and North American carriers, which had seen flat growth through October saw cargo traffic fall 7.6% and 5.4% respectively.

View the full IATA October traffic results
See also: OAG Revises Down Fourth Quarter Forecast
See also: Increases in French, Mexican and Australian Visits to Canada

Airport Leaders Run for Parliament

Two recent airport executives were elected to the House of Commons last month, ensuring that Canada's legislative body will have at least two new members with practical experience in airport issues.

David Innes

Former Toronto Port Authority President and CEO Lisa Raitt (Conservative candidate) and former interim Regina Airport Authority President and CEO Ray Boughen (Conservative candidate) were both victorious in their Halton and Palliser ridings. Ms. Raitt has been named to cabinet as Minister of Natural Resources.

Former Greater Fredericton Airport Authority David Innes (Liberal candidate) also ran in the election as a candidate for the the Fredericton Riding.

The CAC congratulates all of the candidates for their commitment to public service.

(Pictured, Lisa Raitt, Ray Boughen, and David Innes)

Lisa Raitt

As CEO of the Toronto Port Authority (TPA), Lisa was responsible for leading the Canadian federal corporation that manages commerce, transportation and recreation in the Toronto harbour -- including Toronto City Centre Airport. In August, 2008, she was elected chair of the Association of Canadian Port Authorities. She previously had served as the TPA's chief counsel, and harbourmaster.

Lisa pursued education first in science, graduating with a B.Sc. from St. Francis Xavier University in Nova Scotia, and an M.Sc. in chemistry, specialized in environmental biochemical toxicology, from the University of Guelph. She then proceeded to earn her LLB from Osgoode Hall Law School. Upon her call to the bar in 1998, she was honoured as a Dr. Harold G. Fox Scholar and trained with barristers in the United Kingdom who specialized in international trade, commerce, transportation and arbitration.

After the birth of her first child, Lisa and her family moved to Oakville, in the Halton riding. Her husband Dave is an award-winning writer/comedian and an alumnus of the world-famous Second City comedy troupe, and is a small business owner. Lisa and Dave have two sons, John Colin who is seven years old, and Billy, who is four.

Lisa grew up in Cape Breton and is the youngest of seven children. Her father was first a mine worker, loading coal onto ships, and then a union leader, and her mother was a small businesswoman.

In the community, Lisa has been an active Halton canvasser and fundraiser for the Canadian National Institute for the Blind, and for her children's hockey, soccer and gymnastics organizations. In 2002, she was invited to become a member of the Canadian branch of the worldwide Young Presidents Organization.

Ray Boughen

Ray spent 35 years in Saskatchewan's education system as a guidance counselor, teacher, vice-principal of an elementary school, principal of Peacock Collegiate, director of education, and, lastly, registrar and director of provincial examinations and student records for the Province of Saskatchewan. He opened his own consulting firm named Educational Consulting and Counselling Services (ECCS) in 1993.

After defeating incumbent mayor Don Mitchell, Ray served as mayor of Moose Jaw for two terms. As mayor he was instrumental in revitalizing Moose Jaw's downtown core through facilitating the opening of Temple Gardens Mineral Spa, and the Tunnels of Moose Jaw.

Drawing from his experience as an educator, Ray led a provincial commission making recommendations on how to better fund public education in 2004. Most recently, Ray stepped in serving as the as Interim President/CEO of the Regina Airport Authority for 13 months.

Ray was elected in June 2005 as a trustee to the Prairie South School Division Board of Education. He currently serves as director of education for SIAST Campuses.

Ray and his wife Sandy, are long-time Moose Jaw residents. Ray chairs the Zion United Church Council, and also performed a fundraising role while serving as co-Chair of Moose Jaw Multiplex Builders Inc..

Ray holds a bachelor of science from St. Cloud State University in Minnesota, a bachelor of education from the University of Saskatchewan, and a masters of science from the Oregon College of Education (now Western Oregon University) majoring in counseling psychology and educational administration.

David Innes

David Innes is a life long resident of New Brunswick. Having spent his early years on the Miramichi, he studied civil engineering at the University of New Brunswick in Fredericton. He then spent his early years as an engineer planning and designing highways and airports for the province of New Brunswick and then Transport Canada.

David then returned to UNB where he taught a generation of engineering students courses ranging from analysis and design to professional ethics. He was an active researcher, wrote and presented papers nationally and internationally, and rose to the rank of professor. He was also a consultant to industry and government throughout Atlantic Canada.

In 2001, David was appointed president and CEO of the Greater Fredericton Airport Authority. In this role he oversaw the privatization of the Fredericton Airport and has led it through a transition into a capable, busy, and modern international airport facility.

David has provided leadership to his community and his profession throughout his career. His record of service and leadership includes: chair, New Brunswick Aerospace and Defence Association (currently); chair, Greater Fredericton Airport Authority, (1998-2001); president, Canadian Society for Civil Engineering, (2003); chair, Fredericton Region Solid Waste Commission, (1990-1994); chair, New Maryland Local Service District Advisory Committee, ( 1984-1987); chair, Parish Council, Church of Sts John and Paul, New Maryland.(1979-1980).

David has participated in a wide variety of professional and volunteer activities throughout his career. He was awarded the Paul Harris Fellowship by Rotary International; he was named a fellow by the Canadian Society for Civil Engineering; and he was named a fellow, by the Engineering Institute of Canada.

David and his wife Thelma have lived in the Fredericton Area for more than thirty years where they raised their seven children.

Increases in French, Mexican, and Australian Visits to Canada

In Canada's international tourism scene, ongoing large reductions in travellers from the U.S. are still being offset by increases in visits by overseas tourists to Canada and Canadians travelling overseas over the first nine months of 2008.

About 2.7 million fewer American visits were recorded by Statistics Canada for the first nine months -- a 13% drop. These were partially offset by a 9% increase in Canadians travelling abroad, including an 10% increase to overseas destinations.

The decrease in transborder visits by Americans is primarily due to land-based trips. American visits by air were down by just 6%, which was more than offset by an 11% increase in Canadian visits by air.

There was a 3% increase in overseas trips to Canada with increases in travellers from France, Mexico and Australia offsetting continued declines in trips from Japan, the UK and South Korea.

Canada Featured in Payload Asia

On the heels of Cargo Canada participation in the recent FIATA freight forwarding conference in Vancouver, the October issue of Payload Asia prominently features Canada's bid to increase its share of cargo traffic, from the perspective of Canada's airports.

The Cargo Canada campaign, governmental policy challenges and the Asia-Pacific Gateway initiative are quite prominently mentioned in the October cover story.

"It's tempting to observe that Canada has pretty much 'missed the boat' when it comes to air cargo," says the article, referring to Canada's current cargo sector compared to its potential. "With an airport system long in the hands of government bureaucrats, a near solitary focus on passengers and the absence of any Canadian cargo-savvy passenger airline, let alone a globally-focused, dedicated cargo carrier, has all conspired to give air cargo a very low profile at the majority of airports across the country."

But the article notes that things are changing for Canada's cargo sector, with devolution of airport operations from the federal government to local airport authorities and a new, albeit sometimes tepid, approach to air service liberalization by the federal government.

"One of the key changes that has set much of the latter initiatives in motion," the article continues, "was the change in airport ownership structure in which the federal government devolved control to local airport authorities under 60-year operating leases."

The article goes on to note that these airports have invested some $9.5 billion in infrastructure since 1992 and that there has been real progress towards liberalization in recent years but continued disappointments.

"Singapore is a good example," British Columbia Minister of Transport and Infrastructure Kevin Falcon told Payload Asia. "They've entered into a liberalised air bilateral with Canada which is a good first step, but its not a full Open Skies agreement with fifth freedom rights that would be important to Singapore. While we're encouraged by that step in direction we think that we can do more and we ought to do more."

The full article can be found on thePayload Asia Web site.

CANADIAN NEWS
GTAA Reduces Pearson Landing Fees

The Greater Toronto Airports Authority (GTAA) recently announced a reduction in landing fees and terminal charges paid by airlines at Toronto Pearson International Airport. This announcement is in addition to the 25% decrease in all-cargo landing fees that was announced earlier this year.

All reductions will be effective Jan. 1. The total fee reduction will offer projected savings of $28 million to the airlines in 2009. Landing fees are charged to cover the costs of operating Toronto Pearson. Landing fees will be reduced by 0.4% in 2009. Terminal charges are set to cover the costs for the common areas of the passenger terminals. These charges will be reduced by 0.6% in 2009.

Despite a projected decrease in passenger volume for 2009, the GTAA says it has worked diligently to achieve these reductions by generating additional non-aeronautical revenue through concessions and advertising, and by decreasing expenses where possible.

"We are very conscious of the state of the aviation industry and I am proud of the work of all GTAA staff that has allowed us to reduce fees for the second year in a row," said Lloyd McCoomb, president and CEO of the GTAA. "We believe it is important for airports to do what they can to offer savings to the airlines."

The move was welcomed by Pearson's two largest air carriers, Air Canada and WestJet.

The GTAA is the non-share, not for profit authority that operates Toronto Pearson. All revenue generated by the GTAA is reinvested back into the airport. In 2007, 31.5 million passengers travelled through Toronto Pearson.

Calgary Airport Authority Named Top 40 Alberta Employer

Mediacorp Canada Inc., publisher of Canada Employment Weekly and other recruitment, training and retention publications, has named the Calgary Airport Authority to its 'Alberta's Top 40 Employers' list for 2009.

Now entering its fourth year, this annual competition recognizes Alberta employers that are leaders in eight areas: physical workplace; work atmosphere and social; health, financial & family benefits; vacation & time off; employee communications; performance management; training & skills development; and community involvement.

The Calgary Airport Authority, with a staff of 160 employees, receives over 1,000 job applications annually. Attracting and retaining good employees in a very competitive job market is an important focus for Canada's fourth busiest airport.

"The Calgary Airport Authority offers one of the most unique work environments in the city. We are proud to be recognized as one of the best employers in the province," said Cynthia Ewanchyna, senior director of human resources for The Calgary Airport Authority. "The dedication and commitment shown by our employees each and every day has made YYC one of the best airports in the country."

Close to 2,000 employers apply for the award.

Hamilton Airport Wins Marketing Award

Hamilton International Airport recently announced that it has captured a major international prize for airport marketing, the OAG - Routes Airport Marketing Award for the Americas.

The award was presented at the 14th Annual World Route Development Forum in Kuala Lumpur, Malaysia before delegates representing nearly 500 airlines and 1000 airports.

The award recognizes excellence in air service development as voted by industry partners, who nominated airports based on market research and marketing communications activities.

In its first two years, UK carrier Flyglobespan has experienced growth at Hamilton due, in-part the airport says, to leveraging cooperative marketing initiatives with the airport. In 2007, the partners offered more same-plane destinations to the UK than any other North American airport.

Other nominees for the award included:

Dallas/Fort Worth International Airport
Newark Liberty International Airport
San Francisco International Airport
Minneapolis International Airport

Kelowna Opens Extended Runway

Kelowna International Airport recently celebrated a milestone when 8,900 feet of new runway were officially dedicated in front of a crowd of 200 spectators.

"This is a proud and historic moment for Kelowna International Airport and the Okanagan Valley," said Airport General Manager Sam Samaddar. "Today we transition from a continental serving facility to an intercontinental airport."

The extended runway can accommodate larger aircraft, such as those connecting North America with Europe. The extension also means more business for companies in the local aerospace industry, such as Kelowna Flightcraft, through the ability to attract and service larger planes.

The project, which began February 2008, extended the runway from 7,300 ft to 8,900 ft, was completed on time and on budget at a cost of $8 million. Federal and provincial government partners each contributed $1.35 million while the City of Kelowna committed $5.3 million from airport improvement fees collected from passengers departing the airport.

The runway extension project is the first phase of the Airport's 2010 Development Program; the centrepiece of that program is a new international arrivals concourse capable of handling 250 passengers per hour. Improved ground access and expanded vehicle parking, a new car rental facility and two new aircraft loading bridges are also included in the development program.

Kelowna International Airport is investing $36 million to expand facilities to meet the growing demand as passenger numbers are forecast to grow to 1.6 million in 2015. For the third consecutive year passenger volumes at the airport have increased by double digits. Traffic levels reached a new record in 2007 with 1.36 million passengers using the facility, marking an 11% increase over 2006's record breaking year of 1.2 million.

UPS to Open Distribution Centre in Calgary

UPS Canada has announced it is establishing a new distribution centre at the Calgary International Airport to meet the rising demands of Alberta's economy.

UPS is building a 150,000-sq. ft., $26 million facility that will handle import, export and domestic shipments while allowing UPS to double its package processing capability over time. The centre will house 157 trucks and employ 415 of the air transport sector's 6,500 employees.

Since 2003, UPS has seen a 60% increase in the volume of orders from the greater Calgary area, particularly from the retail, technology and financial sectors.

The new UPS facility will have airside access in the airport's YYC Global Logistics Parks, which are part of The Calgary Airport Authority's mandate to foster economic development in the city.

"Calgary is western Canada's largest transportation and logistics centre and one of the major reasons is the 'air cargo bridge' that we've created," said Stephan Poirier, vice president and chief commercial officer for The Calgary Airport Authority. "It provides companies such as UPS access to 24/7 cargo services and an impressive and growing network of integrated transportation systems, services and companies, all on airport land."

YYC Global Logistics Parks have more than doubled air cargo movement at the airport to 134,000 tonnes in 2007 and have helped turn the airport into one of the city's major economic engines. Today, the airport generates more than $5 billion of annual economic activity, approximately 10% of Calgary's gross domestic product, and more than 15,000 people work on airport land.

UPS will continue to operate its three separate distribution centres in the city until the new facility becomes operational in
October 2009.

Québec Air Transport Association Warns of Coming Labour Concerns

The Association québécoise des transporteurs aériens (AQTA) recently released the results of a study that warns of a possible labour shortage in the province's air transport sector unless a plan is developed to replace a large block of workers expected to retire over the coming years.

The study, conducted by AON Consulting and financed by the Québec government, indicates that a third of air transport industry workers are 45 years of age or older, meaning the industry could face a shortage of manpower within five years. The study recommends the implementation of a well targeted strategic plan for the development, recruitment and retention of air transport industry personnel.

AQTA says it has already involved the Commission des partenaires du marché du travail, the Ministère de l'Emploi et de la Solidarité sociale and the Ministère de l'Education, Loisir et Sport in its efforts to promote awareness of the issue.

The study, Etude sectorielle sur la main-d'oeuvre dans le secteur du transport aérien au Québec was conducted over the last year and took a look at the balance between manpower supply and demand for 334 firms engaged in the Québec air transport industry.

INTERNATIONAL NEWS

OAG Revises Down Fourth Quarter Forecast

Continuing problems within the U.S. economy are impacting airline operations with worse than expected declines in international airline capacity this winter, as the number of domestic flights is set to fall by almost 11% and capacity by 9% in the fourth quarter of 2008 compared to a year ago, according to OAG (Official Airline Guide) in its revised analysis of the global travel industry's published flight schedules.

The global picture has improved slightly, with the winter schedules showing a 5.2% decline in capacity and a 6.1% decline in the number of flights. OAG's earlier analysis in August showed a 7% drop for both measures. The latest figures reveal that the world's airlines will offer 46.3 million fewer seats for October, November and December 2008, and 451,000 fewer flights.

The U.S. domestic market will account for 21.4 million of the cutback in available seats, or 46% of the global decline, and a staggering 59% of the global drop in frequencies with 265,000 fewer flights.

The OAG analysis takes into account all future schedules filed by the airlines to date, to provide a comprehensive snapshot of planned airline activity for October to December 2008 with comparisons tracking back 10 years.

Flights and capacity within Europe are also showing worsening cutbacks. Figures for intra-Europe flights are now 5% lower than for Q4 2007 (forecast at -2.7% in August), and seat capacity is now 5.6% lower compared with the previous analysis drop of 2.8% a couple of months ago.

Earlier indications for Asia are not as bad as feared, although still worse than the global figure with a 6.5% fall in capacity and a 7.1% drop in the number of flights.

The effect of what is happening within the U.S. and Europe is seen by the shift on transatlantic and transpacific routes. In August, OAG figures showed that both were showing some growth. The latest figures reveal a capacity reduction of 2.9% for transatlantic capacity, reversing the earlier schedule analysis of 2% growth, and a drop of 3.1% on transpacific routes compared with the previous nominal rise of 0.2% year on year.

The impact of capacity cutbacks on the world's airports remains high. OAG's analysis reveals that 219 of the world's airports are losing scheduled air service altogether, compared to the August figure of 275. Of these, 33 are in the U.S. (15% of the global total); 94 (43%) are in the Asia Pacific region; and 45 (21%) are in Europe.

Canada's Airports:
Working Together, Moving Forward

The Canadian Airports Council (CAC) is the voice for Canada's airports. Formed in 1991, as the devolution of airports to local control was beginning, the CAC has established itself as the reliable and credible federal representative for airports on a wide range of significant issues and concerns.

Canada's airports are engines for economic development in the communities they serve and one of their most important elements of local infrastructure: Our communities' vital links to intra-provincial, national and international trade and commerce. Our 48 members represent 180 Canadian airports, including all of the National Airports System (NAS) airports and most passenger service airports in every province and territory.

Together, CAC members handle virtually all of the nation's air cargo and international passenger traffic and 95% of domestic passenger traffic. The economic impact of CAC member airports is staggering. They create well in excess of $45 billion in economic activity in the communities they serve. And more than 200,000 jobs are directly associated with CAC member airports, generating a payroll of more than $8 billion annually.