International Trade Committee on Feb. 23rd, 2015

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Thank you very much, Chair.

I appreciate you gentlemen for being here.

Mr. Gibbons, I'm going to start with you. Happy birthday and welcome to Fredericton. I'm sure that we're going to be very excited that we're giving Frederictonians an opportunity to become million milers with WestJet as well.

[Andy Gibbons]

Absolutely.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

You talked a little about all your heavy maintenance being done in Canada and you also talked about your expansion and you're going to the wide-body planes. My assumption is that maintenance is going to be done in Canada as well at Kelowna and Windsor. As your expansion has grown and you've had more access to these markets through ATAs and others, how has your heavy maintenance grown and how has your employment in your heavy maintenance area grown over the past number of years?

[Andy Gibbons]

Windsor is a new area for heavy maintenance for us and that was a community that wanted to see those jobs relocated, so we do heavy maintenance in those two locations. We don't have the specific employment numbers because they're at Kelowna Flightcraft and Premier Aviations, so I can't say, but when you look at our fleet of 737s we're over a 114 now. That's a significant amount of investment and at Kelowna Flightcraft, it's not just heavy maintenance, it's also where we're installing our new in-flight entertainment, our new slim-line seats, so all the retrofitting of some of our aircraft is also conducted there. It's a very integral partnership.

That doesn't answer your question specifically, but I'm happy to look into it and give you the economic—

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

If you would, it would be helpful.

[Andy Gibbons]

Yes. I could get you the numbers.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

But suffice to say that we've seen as a result of this heavy maintenance a lot of good jobs, because of the expansion of WestJet as well.

[Andy Gibbons]

Yes.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Can you comment a little bit about freight? We've heard in our previous meetings with some of our airlines about the freight and using some of the belly of the plane now for carrying high-value freight, maybe not much from tonnage but very high value. How has that kind of business grown for WestJet and do you see that as an area where you would expand in the future?

[Andy Gibbons]

We certainly do. In fact today we were just named by a logistics institute as the top cargo services. It's an emerging part of our business. I'm not the SME on our cargo statistics except to say that with wide bodies and those longer haul routes we expect that to emerge, but it hasn't historically been number one in our business priorities. Again, that's another item I'm going to have to get you some more information on.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

You talked a little bit about capacity and one of the challenges you saw was perhaps some landing slots that sometimes becomes a little bit of a challenge.

Are there specific markets where you see those landing slots becoming a challenge? Are there areas where the government might help you to grow in some of these areas?

[Andy Gibbons]

I think the government definitely can help grow in some of those areas. I don't want to list the areas, obviously. What we've said publicly is that with our 767s—and this is a trial run, we've ordered four 767s and in 2015 they'll be servicing Hawaii from Alberta. Then, for 2016, we'll be announcing the international destinations for them.

I'm stating that to point out that with respect to the issue of unused capacity, there are various reasons why that's unused. The government has been a great partner in terms of access to Cuba, previously, and in terms of Mexico, which I noted in my remarks.

It used to be that you had to be designated by Transport Canada in order to land somewhere. As we were growing as an airline, these agreements allowed us to simply make the investments and go in. That's been tremendous. That's where it creates a level playing field.

There are, however, specific examples of slot constraints at airports internationally.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

I understand.

[Andy Gibbons]

You've heard the discussion on them, but I'm flagging it as one of the ingredients that go into unused capacity versus a barrier to growth.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Before I move to Mr. Darch, my last question is for clarification.

You talked a little bit about your Bombardier Q400s, WestJet Encore, which is going to be the service in Fredericton, obviously. You talked about being beyond gateway access. I'm assuming that, from a consumer perspective, it will be good news for Fredericton, as an example, because we're giving people a choice.

When you talk about that beyond gateway access, are you talking about the additional international flights of people from Fredericton who will be able to have another alternative for international flights? Is that what that beyond gateway access means?

[Andy Gibbons]

That's exactly what it means.

Your constituents are going to have a new option. They can buy a code-share ticket in Fredericton, go to Toronto, and fly British Airways or Air France, or fly any of our code-share partners. We've seen more of that in western Canada. Fredericton was our first new Encore destination in Atlantic Canada, so we're going to see more of that. What we have seen in B.C. is beyond gateway access.

In some of these markets, it cost the same amount to fly from Prince George to Vancouver as it did to fly from Vancouver to Tokyo. We're trying to change that. We're working to change that and we're starting to see those results.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Thank you, Mr. Gibbons.

Mr. Darch, can you talk a little bit about the integrated messaging that Consider Canada City Alliance has been able to do with international trade in terms of integration and managing websites, and social media? What are some of the things that trade and other departments have done to coordinate that communication with your group? What have been the very good things that have been done and are there things we could do in the future to make it even better?

[Mike Darch]

If I go back even a couple of years, essentially competition for foreign investment was viewed as one city competing against the other city. When we had our first meetings, the discussion was, “Now wait a second, the competition to Calgary isn't to Ottawa; it's Houston and the Middle East, etc.”.

When we look at getting a Canada message out—let's just say that we're birds in the nest and we have 11 chirping birds wanting to get that worm—it's much better if we're going on a coordinated message.

You'll see on our website now that we have 11 two-page descriptions of each city. If you look at their comparative advantage, you'll see that we've taken the Invest in Canada primary points about the value of Canada, such as talent, secure financial system, etc., and we've woven it into each of those 11.

For example, Toronto will give a financial stability message. Ottawa will give a message on talent. We're trying to make sure that the Canadian message is the same at the federal level as it is at our individual municipal levels.

On the Invest in Canada website, there is a—

[The Vice-Chair, Liberal, Chrystia Freeland]

Mr. Darch, I'm so sorry. Can you just wrap up your sentence because we've gone over the time.

[Mike Darch]

There is a part there on description of individual cities in Canada. Those are now done by the cities themselves and the cities are responsible for making sure that the information is current. Those are some examples.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Thank you very much, Madam Chair.

[The Vice-Chair, Liberal, Chrystia Freeland]

Thank you very much.

I would like to ask the indulgence of my colleagues on the committee. It is normally the Liberals' turn to ask questions for five minutes. If anyone would like to pose as a Liberal, we could do that. But it might cause fewer problems to have me do it.

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

Do you have money in a brown envelope?

[Some hon. members]

Oh, oh!

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

I could pose as a Liberal.