Transport Committee on Jan. 12th, 2023

[The Chair, Liberal, Peter Schiefke]

I call this meeting to order.

Welcome to meeting number 46 of the House of Commons Standing Committee on Transport, Infrastructure and Communities.

Pursuant to Standing Order 108(2) and the motion adopted by the committee on Thursday, February 3, 2022, the committee is meeting to discuss Air Passenger Protection Regulations.

Today’s meeting is taking place in a hybrid format, pursuant to the House order of Thursday, June 23, 2022. Members are attending in person in the room and remotely using the Zoom application.

Members of the committee, appearing before us today as witnesses from Air Canada, we have Mr. Kevin O'Connor, vice-president of system operations control, and Mr. David Rheault, vice-president of government and community relations. Both are appearing by video conference.

Also by video conference, we have from Sunwing Mr. Len Corrado, president, as well as Mr. Andrew Dawson, president of tour operations with the Sunwing Travel Group.

Appearing from WestJet Airlines in person, we have Mr. Andrew Gibbons, vice-president of external affairs, as well as Mr. Scott Wilson, vice-president of flight operations.

I would like to begin by thanking our witnesses in advance for their time today.

I also thank the members of this committee for the reference to ensure not only that this meeting took place, but that it took place as quickly as possible. It is my hope as chair that this meeting and the subsequent meetings will provide the answers that Canadians and this committee are looking for, and that actions can subsequently be taken to ensure that the experiences faced by travellers over the holidays never happen again.

With that, I would like to turn it over to Air Canada for opening remarks.

Air Canada, the floor is yours. You have five minutes.

[David Rheault, Vice-President, Government and Community Relations, Air Canada]

Thank you, Mr. Chair.

I thank the committee for inviting us here today to talk about Air Canada's operations over the holiday season.

I am pleased to be accompanied by Kevin O'Connor, vice-president of system operations control. Kevin is responsible for the operations at Air Canada.

First, let me say that all of us at Air Canada sincerely sympathize with customers whose travel has been disrupted. We understand the importance of travel during the holiday season and the disappointment people feel when things don't go as planned.

More than 2 million people travelled with Air Canada during the period from December 22 to January 8. Most importantly, they did so safely.

It was the dedication of our 35,000 employees, more than during the same period in 2019, that allowed us to transport our customers and restore our operations quickly following the weather events. On behalf of Air Canada, I want to acknowledge their exceptional work, which was often done in very difficult conditions, in the cold and the storm. I thank them for taking care of our passengers.

Kevin will now give you a main overview of our main challenges and accomplishments.

[Kevin O'Connor, Vice-President, System Operations Control, Air Canada]

Thank you, Mr. Chair and members of the committee.

Air Canada went through the holidays very well prepared. We were fully staffed, our people were trained and our schedule was prudent. We also had a great deal of resiliency built in. As an example, we set aside 15 aircraft—including wide-body aircraft—that were not scheduled to fly, but could be used for recovery or redundancy.

As a result, we operated nearly 1,000 daily flights on average. An Air Canada plane took off almost every 90 seconds of every day of the holidays, and we did this despite the extreme weather.

How extreme was it? In Vancouver, four-foot icicles formed on aircraft and bridges, making it almost impossible to move customers. In Calgary, at one point, it got so cold that de-icing fluid was not able to be used to remove contamination. In Toronto, certain airport baggage systems started to freeze.

Across the continent, we faced the types of delays and slowdowns familiar to anyone who travels in harsh winter weather. Because we are a network carrier that operates interconnected flights, severe weather can drastically impact our schedule and our movement of people and their baggage.

A delay in one part of the country has a knock-on effect across our network. For example, aircraft can be scheduled to fly from Toronto to Calgary in the morning, then on to Vancouver, and then to a southern destination later that day. However, if it is held up by weather in one place, it is late for its next flight, or its final flights may be cancelled if the crews go over their legislated duty day.

In such situations, we prioritize international flights, which are more difficult to recover because of the long flight times. Overall, we operated 98% of our international flights during the holiday period. Our ground operations can also be affected, because the employees' work schedules are tied to the planned operating schedule. This in part accounts for misconnected and delayed baggage.

We move bags parallel with our customers, but if a flight is delayed, bags can misconnect. They also accumulate in airports, because our ability to move them on the next flight is limited on those later flights, given that they're full during the holiday period.

Finally, I'll say a word on customer communications. During a storm, with its unknown duration and impact, it's not always possible to immediately re-book customers. We must wait until the weather improves enough that we can assign aircraft and crew. Still, even at the peak of our bad weather—December 23 to December 27—Air Canada re-booked more than 107,000 customers who were affected by flights.

We also implemented a very flexible re-booking policy. We gave refunds and waived fees for our customers who chose not to travel. It's noteworthy, though, that the vast majority of customers chose to not re-book and travelled as planned, even when they understood their travel might be slower than normal.

I'll pass it to you, David.

[David Rheault]

I would like to conclude this presentation by asking a question that we are all seeking to answer. How can we improve the situation in the future, at least as far as Mother Nature will allow?

First, there has been a lot of talk about the Air Passenger Protection Regulations. As we have done and will continue to do, we comply fully with the regulation obligations. However, recent travel disruptions have been the result of major weather events. There is no protection regime in the world, including the regulations, that requires air carriers to be liable for financial compensation in cases of force majeure.

As well, the air transport system consists of many stakeholders working together to move passengers safely and efficiently. Each entity has an independent role to fulfill to make the system work, but airlines are the only ones with enforceable standards and financial obligations. There needs to be shared accountability.

The government should also take a broader view on policies to support the industry, and invest in and modernize infrastructure. At present, hundreds of millions of dollars are taken from passengers and the industry in taxes, fees and airport rents, and put into general revenue. This money should be reinvested in air transport infrastructure.

We need to move forward with digitization, facility upgrades and other improvements. These would benefit people by making everyday travel easier, and ensuring that the system is robust enough to withstand irregular operations.

Thank you for your attention.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Rheault.

Thank you very much, Mr. O'Connor.

Next, from Sunwing Airlines, we have Mr. Corrado.

The floor is yours, Mr. Corrado. You have five minutes.

[Len Corrado, President, Sunwing Airlines]

Thank you, Mr. Chair.

I want to thank the committee for allowing me to appear here today. My name is Len Corrado, and I'm the president of Sunwing Airlines. I'm joined today by Andrew Dawson, president of Sunwing Vacations.

Let me begin by apologizing that we failed to deliver to the level that we had expected to and that Canadians had expected from us over this holiday season. We had planned that this holiday season would be a return to normal in a postpandemic world for our flying program. We built a robust plan to meet the high demand for travel to sun destinations. While many of our customers enjoyed their holidays with minimal disruption, we had some failures in execution, for which we are very, very sorry.

Three primary issues caused disruption to our schedules. First, several storms severely impacted our operations across the country. This included the virtual shutdown of Vancouver's airport and caused major delays in Ontario and Quebec. These weather events impacted not only our ability to service our customers flying through those airports but also our ability to position the necessary crew to service our own operations at other departure locations due to the cancellation of flights by other carriers impacted by these events.

The second issue was staffing. In anticipation of a busy winter season, Sunwing began recruiting pilots last spring. We went from a low of 40 pilots during the pandemic to over 475 pilots in preparation for our winter flying. Sunwing also applied to hire 63 foreign pilots on a temporary basis to supplement our crewing levels. These pilots would have been based in Regina and Saskatoon, where we run service only during the winter months, as we have since 2007. Unfortunately, our application was unexpectedly rejected. We took action and made alternative arrangements. These included subservicing aircraft into our schedule to make more of our own crew available, rebidding and rebuilding the pilot schedule and bringing subserviced aircraft specifically into that market.

Third, these challenges were compounded by airport infrastructure issues, such as a malfunctioning baggage belt system at Pearson, de-icing fluid shortages in Vancouver and various other issues that affected several carriers.

I would also like to take a moment to share features of our unique business model. Among our customers, 95% are leisure travellers who have purchased their flight as part of a fixed-duration vacation package. You may recall that earlier this summer, other carriers experienced operational challenges as they ramped up to their peak operational season. Uniquely, Sunwing's peak flying occurs in the winter. Our ramp-up coincided with the first of the storms. Unlike traditional airlines, we don't have the flexibility in our network to adjust our schedule and shift passenger itineraries. We almost always have customers waiting in a southern destination with a very fixed timeline to return to Canada, and often on routes where alternate flights do not readily exist.

While many of these factors were out of our control, I want to be clear with this committee and Canadians that our team immediately jumped into action to try to make things right for our customers. We worked around the clock to minimize customer disruptions while recovering our schedule. We provided customers with hotel accommodations, food and beverages, and local support at destinations, all at our expense, regardless of the reason for delay.

With respect to compensation, I want to assure committee members that we fully understand our obligations under Canada's APPR, and we will fully comply with these regulations. We are actively accepting claims for compensation under the APPR. Customers may submit their claims for review at our website.

With respect to passenger communications, we have immediately implemented changes to address some of the technical issues with flight alert notifications to improve communications with our customers.

With all this said, the bottom line is this: We know we could have done better. When even one customer is let down by their experience with our airline, I consider that a failure. We'd like to reassure committee members and Canadians that we are committed to providing the quality of service and experience that they've come to expect from us over the last 20 years.

Thank you for your time. I would be happy to answer any questions you may have.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Corrado.

Next, from WestJet Airlines, we have Mr. Gibbons and Mr. Wilson.

The floor is yours. You have five minutes.

[Andrew Gibbons, Vice-President, External Affairs, WestJet Airlines Ltd.]

Good morning, Mr. Chair.

Thank you very much to members of this committee for having us here today. My name is Andy Gibbons. I'm the vice-president of external affairs at WestJet. I am joined today by two of my colleagues—Captain Scott Wilson, who is our vice-president of operations, and Jared Mikoch-Gerke, who is our director of government relations and regulatory affairs.

We are here today to take questions on public policy, operations and the APPR. You have questions, and we are here to give you and Canadians answers.

I'd like to begin by speaking directly to our guests who are listening today: We thank you for choosing our company for your travel and thank you for your patience during a period that was stressful to us all.

Our record and success over 26 years is because of you. Everyone in our organization knows this and lives by it. Every single WestJetter feels the weight and anguish of not being able to meet your travel expectations.

I also want to offer a sincere thank you to our incredible WestJetters and contract service providers across the country and our network who worked long hours and extra days and gave up time with their families to support our guests during what was the most challenging winter season experienced in Canada in recent memory. Thank you.

This was a once-in-a-generation event. We experienced record cold and freezing rain driven by winds more typical of a hurricane.

On December 23, Canada's busiest travel day of the year, all but one province received extreme weather advisories. This is not a normal Canadian winter.

WestJet proactively took many additional steps over and above our regulatory obligations to help our guests. We offered a full refund for anyone who wanted to cancel their travel in advance. We offered three nights of hotels at our expense for any guest stranded mid-journey in a connection city. We completely opened our flexible change and cancel guidelines and absorbed hotel cancellation fees for our vacation guests.

Additionally, our corporate and frontline staff stepped in and stepped up to work across our system in service of our guests. We worked with our service partners and labour groups to provide incentives and bonuses to our frontline employees in acknowledgement of the work they were doing in a situation that none of us, or them, created.

[Captain Scott Wilson, Vice-President, Flight Operations, WestJet Airlines Ltd.]

Thank you, Andy.

Good morning, everyone.

In addition to being vice-president of operations, I'm also the Transport Canada designated representative tasked with ensuring safe operations as WestJet.

Our preparation efforts began early in the fall for this winter's peak season. We held weekly meetings and tracked our preparedness towards the peak. What we could not have foreseen in this preparation was the compounding scale of the weather events that we encountered in our system between December 18 and December 24. In my 22 years at WestJet, this was the most significant weather-induced disruption that I have experienced.

Canadian air carriers have some of the most significant experience in cold weather and winter operations. Mother Nature, however, always has the ability to show us where our limits are. In our particularly harsh climate and operating environment we will always take the time to ensure the safety of our people and our guests. The most difficult part of making a safe decision is ultimately knowing that it impacts our guests and the travel plans that they've entrusted to us. That notwithstanding, during this peak season, WestJetters worked hard to safely carry over 1.2 million guests and operate a significant number of additional flights in support of recovery operations. We very much regret that we had thousands of guests whom we could not get to their destination for Christmas due to weather disruptions. We were thankfully able to stabilize and recover our operation by December 26, which allowed us to refocus our efforts on providing recovery options for our guests, even as challenging weather conditions continued in many areas across our country.

Given the scale of disruption we just experienced, we recognize that for meaningful improvements to happen, we need a holistic approach that brings together the entire aviation system. Aviation is an ecosystem that relies on the capability of all partners to deliver effectively, reliably and safely.

[Andrew Gibbons]

Given last month's events, we have identified two main areas for improvement as part of an overall lessons-learned exercise. These areas are improving guest communications when things go wrong and improving our overall baggage performance. These areas are a priority for our company, among others, and we'd be pleased to share the details and updates with committee members as we go forward.

Importantly, we also believe that the government must address the most glaring gap in consumer protection in Canada today. This is the fact that your delay or cancellation can be caused by many groups, yet only airlines have regulations governing their activities. We believe this committee should demand equal policies for all entities that provide a service that can result in a delay or cancellation. These include government entities, airport authorities, NAV Canada and others. Strengthening overall accountability across our entire aviation system will improve service for all, bring down complaints and provide the transparency our guests and all travellers deserve.

We will be pleased to answer your questions and look forward to the discussion.

Thank you, Mr. Chair.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Gibbons.

Thank you very much, Mr. Wilson.

We'll now begin our line of questioning.

I'd like to point out to members that I'll try to be as diligent as I can today and as strict as possible with the time, as I know that we all have questions. At the five-minute, six-minute or two-and-a-half-minute mark, I will be cutting you off and turning it over to the next questioner.

With that, we will begin with Mr. Strahl.

Mr. Strahl, the floor is yours. You have six minutes.

[Mark Strahl, Conservative, Chilliwack—Hope, BC]

Thank you very much, Mr. Chair.

Thank you to the witnesses for being here for this emergency meeting to discuss the failure of the Canadian transport system and the impact that it had on Canadian travellers over one of the most important travel seasons of the year. Of course, we recognize that this is now the second travel season in a row in which there have been major travel disruptions, in which passengers have been stranded in airports, stranded abroad and separated from their baggage. It's a situation, quite frankly, that the minister told us in the fall had been resolved. He was convinced and had confidence that there would not be a repeat of the travel chaos from the summer. Of course, we've seen horror stories that, I would argue, were even worse.

My first question is for Sunwing, for Mr. Corrado.

On what date did Minister Alghabra reach out to you directly to discuss Sunwing's failure to return Canadian passengers home on their scheduled flights? On what date did you first discuss this with the minister directly?

[Len Corrado]

We were updating the CTA from December 26 on and then Transport Canada from December 27—

[Mark Strahl, Conservative, Chilliwack—Hope, BC]

My question was about the minister directly. When did the minister get in touch with you about this matter?

[Len Corrado]

Again, checking my notes, I believe our first contact with the minister was on December 29.

[Mark Strahl, Conservative, Chilliwack—Hope, BC]

Okay, so it was about a week after things had started.

I'll ask the same question to Mr. Gibbons from WestJet.

On what date did you speak with the minister or his office directly?

[Andrew Gibbons]

I don't have the exact date, Mr. Strahl.

I know that our chief executive texted the minister very early on in this to advise him that the storm was coming, so to speak, and that they would be needing to have regular conversations. He also offered to the minister to make his entire team available to the department should they have any questions or concerns about our operations and our decisions; that was fairly early on. I would say that was December 20 or 21, whenever the incidents really started to take shape.

[Mark Strahl, Conservative, Chilliwack—Hope, BC]

Is that when you reached out? Did you hear back immediately? Did you hear back in a week, as we've just heard from Sunwing? What sort of timeline did you have for the minister to respond?

[Andrew Gibbons]

With respect to times of crisis, we've had to develop very close relationships as this isn't the first time there have been disruptions. We've had communications with his chief of staff, their team and their department probably every day throughout the crisis at every level of our company and every level of the department and the minister's staff. They've been fairly heavily engaged every step of the way.

[Mark Strahl, Conservative, Chilliwack—Hope, BC]

I'll ask the same question to Air Canada.

Were you in contact with the minister's office from the outset, and how quickly was he able to respond to your direct contact with him?

[David Rheault]

We were in contact with the minister's office and Department of Transportation officials on a regular basis throughout the fall. When the December events occurred, we had regular, almost daily, contact at various levels with the minister's office and with the department to provide updates and exchange information.

[Mark Strahl, Conservative, Chilliwack—Hope, BC]

Thank you.

Mr. Corrado, I'll come back to you.

Obviously, I think what happened with your passengers abroad is very concerning. We've heard your reasoning for that.

I want to talk specifically about your operations in Saskatchewan. I find it very troubling that you would have booked travel and taken money from Canadians when you didn't have pilots lined up for the flights that you were selling.

Can you advise this committee when you learned that you wouldn't have these pilots available? How did you possibly book travel for Canadians when you did not have crews or planes lined up to service them? This is a catastrophic failure, with heartbreaking stories of people cancelling weddings, losing trips of a lifetime, and abruptly pulling out of an entire province.

How do you explain a business model that allows you to take money from Canadians while you don't have the crews to deliver that service?

[Len Corrado]

As we began to prepare for this winter's operations last spring and identified our pilot requirements, we identified the requirement for 63 additional pilots that would fall under the temporary foreign workers program. We had previously availed ourselves of this program, several years back. We had a certain amount of assurances from our legal team that this should be a successful application, and we proceeded down that road, the road to that application.

Unfortunately, on December 9 we were informed by the ESDC that they were not going to give us a positive opinion on that and, as such, could not use the foreign pilots. We immediately took action. We rebuilt our schedule, rebid our pilot rotations, brought in additional subservice aircraft to free up our own crew to bring into that marketplace, and we put some aircraft specifically into that marketplace from a subservice provider.

Unfortunately, even with all this, in the midst of the storm, with the inability to position, with the inability to recover from the various locations due to the limitations, we failed to deliver to the level we had expected to and—

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Strahl.

Thank you very much, Mr. Corrado.

Next we have Ms. Koutrakis.

Ms. Koutrakis, the floor is yours. You have six minutes.

[Annie Koutrakis, Liberal, Vimy, QC]

Thank you, Mr. Chair, and thank you especially for convening this emergency meeting for questions that we owe to Canadians. I'm really hoping that in today's meeting we will do just that.

My questions are directed to Sunwing.

I'm wondering what is a reasonable amount of time to ask your clients to remain on standby in hotel lobbies or airports while your company figures out how to get them to their destination. I'm curious to know if you have a policy on this. If so, what is it?