The federal Competition Bureau says it is going to look the home air journey business in Canada, and it is searching for enter from Canadians because it prepares to examine the market in the approaching months.
The company, which is tasked with imposing competitors legislation in Canada, mentioned in a press launch itemizing the explanations for its examine that home airfare in Canada “appears to be relatively high” and that Canadians are submitting extra complaints about air journey lately.
The bureau additionally famous that home air journey is “concentrated” with solely two main airways — Westjet and Air Canada — and that new airways appear to have difficulties becoming a member of the business right here.
“What we’re trying to do here is study how competition is working in the sector, really with a view to making recommendations to government,” mentioned deputy fee Anthony Durocher.
“Why this matters is because we know that competition means lower prices, more choice, more innovation.”
Public invited to remark
The Competition Bureau has requested Canadians to weigh on the upcoming examine’s phrases of reference, primarily requesting public remark on the scope or potential limitations of the upcoming examine.
The tentative, draft phrases of reference point out that the bureau wants to reply questions, equivalent to, “How can policymakers further support airline entry and expansion?” and, “How can policymakers further support consumers when shopping for airfares?”
The public has till June 17 to submit suggestions, after which the bureau will finalize phrases of reference and formally launch the market examine, which is deliberate to be accomplished by summer time 2025.
The report would make suggestions to authorities, however just isn’t taking a look at any particular allegations of wrongdoing.
Airport prices too excessive: Flair Air
The Competition Bureau’s draft for the examine consists of questions round whether or not Canadians can be keen to use “secondary or more distant” airports, however business gamers level out one issue is that they consider airport prices or rents in this nation are too excessive, which is being handed on to prospects.
“When you look at the cost of operating to a Canadian airport, relative to one in the US [or Europe], the airport fees are much higher here,” mentioned Garth Lund, chief industrial officer with Flair Airlines in Vancouver.Â
“The whole ecosystem in Canada is very expensive when it comes to aviation and airports are a big piece of that,” mentioned Lund, whose airline positions itself as a low-cost service. He known as charges like {that a} “main contributing factors to higher airfares.”
It’s a message echoed by Westjet CEO Alexis von Hoensbroech, who informed CBC Radio’s The Calgary Eyeopener in an interview that “the government should actually stop collecting rent from airports” as one step towards addressing affordability.
However, in a post on X, previously generally known as Twitter, federal Minister of Innovation, Science and Industry François-Philippe Champagne recommended that the Competition Bureau’s market examine be “refined to focus on domestic passenger airline services rather than airport governance.”Â
The examine’s phrases of reference would have to be authorised by the minister, and in draft kind say they won’t consider airport governance besides the place it relates to competitors for Canadian passenger providers.
Regulator utilizing new powers
The market examine, which was first introduced May 9, is the bureau’s first because it gained new powers in December
“One of the important changes to our law, and it’s something we’ve advocated for for quite some time, was the ability to compel information rather than just companies providing it to us voluntarily,” mentioned Durocher.
“Whether we’re going to do it for this first study, I think remains to be determined.”
He expects the Competition Bureau will make that call after the market examine formally launches in the approaching months.
With low cost airways Swoop and Sunwing being absorbed into WestJet, some concern the lowered competitors will imply greater general airfares. WestJet’s CEO says it will not.
Over the previous 13 months, newer low-cost carriers Swoop and Lynx Air have disappeared from the skies and WestJet scooped up Sunwing Airlines, with the latter two making up 72 per cent of seat capability from Western Canada final yr, in accordance to the bureau.
In a press release emailed to CBC News, Westjet mentioned, “Air travel is essential to our country and we welcome interest from all groups,” with regard to this examine.Â
Air Canada mentioned it couldn’t remark instantly on in the present day’s announcement, as they’re reviewing the draft.