Good evening, Madam Chair.
Good evening, members of the committee.
My name is Lucie Guillemette and I am the executive vice-president and chief commercial officer at Air Canada.
I am joined by my colleagues David Rheault and Fitti Lourenco.
We are here today to speak about the modernization of the Canada Transportation Act, specifically the intent to improve the traveller experience.
Air Canada is Canada's largest airline. In 2016, Air Canada and its regional partners carried close to 45 million passengers, and operated on average 1,580 scheduled flights each day, offering direct service to more than 200 destinations on six continents.
Since 2009, Air Canada has grown by more than 50%, extending the reach of its global network and achieving its ambition to become a global champion.
We employ 30,000 people and 3,000 of our employees were hired in the last three years alone, providing a significant boost to job creation in this country.
Headquartered in Montreal, Air Canada operates four hubs: Pearson airport in Toronto, Vancouver airport, Trudeau airport in Montreal and Calgary airport. We open Canada to the world and provide travellers unparalleled international access.
We've launched new training programs for front-line staff, introduced on-board customer service management programs, improved and clarified our customer service plan, and created new policies for family seating, family check-in at airports, and the carriage of musical instruments. We have also pioneered flight passes and branded fares, offering more choice and flexibility to our customers, who can select the attributes and features that are most meaningful to them.
We recognize that valuable services and features for leisure vacationers vary significantly from those for business passengers, and we aim to meet the needs of all our customer segments, domestically and internationally.
The airline industry is extremely competitive, and we view service as an important differentiator. Financial stability and sustainability has allowed us to invest significantly to improve passengers' experience. For example, we have renewed our fleet and acquired modern aircraft, such as the Boeing 787 and the Bombardier C series. We've reconfigured our cabins, introduced a new premium economy cabin, and improved the inflight entertainment systems. We've invested in a new website and have developed new applications that simplify the passenger experience.
For all our efforts, we are very proud to have been recognized by Skytrax as the best in North America and to be the only international carrier in North America to receive a four-star ranking. I can assure you that we are committed to continuing our efforts to improve the experience of our passengers on the ground, in flight, and post-travel.
In the current regime, carriers have different standards and offer different compensation in a system based on complaints. Having a clear set of standards for all carriers would be appropriate, without, however, imposing an undue financial burden on carriers or limiting their ability to distinguish themselves through the customer service policies they offer.
Although Bill C-49 takes positive steps in laying the groundwork for the regulatory process, we have concerns, and I would like to address a few now.
Number one is simplifying the regime. The proposed regime would be applicable for flights to and from Canada. This creates complexity for carriers and confusion for passengers, since other regimes are applicable in other countries, which could provide for different rules, different exemptions, and different levels of compensation. For example, in a situation of denial of boarding on a flight departing from the United States to Canada, should we apply the Canadian or the U.S. regime? To simplify the regime and make it effective, we suggest that it be limited to flights departing from Canada, as the American regime is limited to flights departing the United States.
We also submit that in the case of code-share flights, the claim shall be made with the operating carrier, as in the European regime. These adjustments would simplify the regime for carriers and passengers, allow for the speedy and timely issuing of compensation, and avoid the risk of double compensation.
Second, on baggage liability, Air Canada agrees with the principle of harmonizing the rules of liability related to baggage. The bill should, however, acknowledge that passengers are already protected by the Montreal Convention, in the case of international travel, which provides clear and consistent rules that are applicable internationally. We therefore submit that the rules provided in the bill should be limited to domestic travel and harmonized with the rules of the Montreal Convention. This would also simplify the rules for carriers and avoid confusion for passengers.
Number three, apply one decision to all passengers on the same flight. In its current form, the bill could also allow for a generalized type of compensation, which would fail to consider the particular circumstances of each passenger. For example, if one passenger submits a claim and is compensated for a delayed flight, the same claimant compensation could potentially be applied to all passengers on that flight. The decision to extend compensation to other passengers should not be arbitrary, but should take into account each passenger's individual circumstance. A connecting passenger who arrives late on the first leg of the trip but catches the next flight is not ultimately delayed.
Number four is on future amendments. Future changes should be transparent and involve all stakeholders, including passengers and carriers. As it stands, Air Canada is concerned that the bill could give the Canadian Transportation Agency powers to create regulations outside of the specific situations provided in the bill. We ask that the committee clarify this language to specify that the regulatory power of the CTA is consistent with the scope of the bill.
Number five is joint ventures and foreign ownership. The amendments to how joint ventures are examined by the government are very positive. In our own experience and from other examples around the world, joint ventures are innovative ways for carriers to expand their networks, add new destinations for passengers, find efficiencies, and offer more pricing options for passengers. Joint ventures allow us to develop the Canadian aviation infrastructure by building international superhighways.
While giving the Minister of Transport the ability to consider joint ventures is excellent, as his department is best-equipped to understand the complexities of our industry, some of the amendments are not in line with best practices around the world. One example is the ability for the minister to review a new joint venture at the two-year mark from approval. The initial period of any joint venture is devoted to better co-operation between partners while the most important changes that pertain to network and fares take more time to implement. We propose that the term for review be lengthened and start from implementation versus approval of the joint venture.
The bill also suggests sanctions that are too punitive, given the commercial nature of JVs. Indeed, the sanction of imprisonment could dissuade a potential partner from even considering the possibility of a joint venture. These issues alone could be a significant barrier to make any use of the benefits of the bill. We ask that the committee consider the suggestions in our submission carefully on this issue.
With respect to foreign ownership, Air Canada is supportive. However, we ask that adjustments be made so that foreign investors cannot negatively influence Canadian carriers or circumvent the spirit of the bill. We also recommend changes that would allow for a ready implementation of the new ownership structure.
Finally, I would like to stress that we operate in a very complex environment. The collaboration and efficiencies of many other stakeholders are instrumental to the overall improvement of the traveller experience. These include airports, CATSA, CBSA, and Nav Canada.
Unfortunately, the airline is too often left to manage all of the negative consequences, but we do it because it is the right thing to do for our customers. While the bill would require carriers to provide the CTA and Transport Canada with data, I would submit that all other agencies and organizations required and involved in the transportation system should be equally accountable for their operations, and submit data in a public and transparent manner.
We also invite the government and the committee members to study the measures that could be implemented, so that all government-controlled agencies contribute to the improvement of the traveller's experience and support the growth of traffic by Canadian carriers. After all, we are powerful economic enablers. If the world indeed needs more Canada, we want to bring it to them.
I thank you for the opportunity to present our views. We look forward to your questions.