Transport committee  —because the airline industry, I think in its entire history, if you add it up, has never made much money, but I think this is an expensive place to do business, and what is an incontrovertible fact is that if there were lower costs in the system, more people could afford to fly—

Transport committee  We have a very simple model: It's keeping our costs as low as possible and passing that on to customers in the form of lower fares. We do that through two things. The first is running an efficient business, and the second is providing choice to customers around what we charge for.

Transport committee  I'm not going to pretend it's been an easy journey. It hasn't, but we are still here. We've done it without any specific support from the government, with the exception of the RATI funding of $11 million we received, and that went directly to encouraging regional connections. We didn't get the $270 million that Porter got, the $370 million that Sunwing got, the $800 million that Transat got, or the $5 billion that Air Canada got.

Transport committee  I think air travel is fundamental to that. It's actually with a free market for air travel that we'll see the connectivity come. This is a big country that will require certain measures taken for more remote communities—there's no doubt about that—but for the big connections, air travel is the most logical way.

Transport committee  You raise a great point. This is what we call the “Flair effect”. When Flair enters a market, it brings prices down for all the participants in the market. The Flair effect, on average, has resulted in a 34% reduction in fares in the markets that we operate in relative to what it was prior, and that's for all Canadians.

Transport committee  It's a relatively short market. It has expensive airport costs at either end, and the ability to amortize those airport costs per mile means that every mile you operate in is relatively expensive. Lower airport costs at either end would certainly make a difference.

Transport committee  Undoubtedly. I mean, Canada is a very expensive place to do business. I've worked in airlines around the world. I was 16 years at Air New Zealand. I was chair of the Star Alliance management board during that time. I was three years as the managing director and deputy secretary CEO of Wizz Air in Europe, one of the world's best ULCCs.

Transport committee  I did hear the comments, and I was wondering how much time it spent in Europe, because Europe is a very competitive market, and ultra-low-cost carriers operate there quite successfully. I think, absent Flair, Canadian airfares would be much higher. Absent Flair, I think the competition in this country would revert back to what it was like previously, when you had to pay $800 to fly for an hour and a half.

Transport committee  Yes.

Transport committee  That's right.

Transport committee  I'm fundamentally a free marketeer. I believe that competition is good. I think that if we saw an open market, we would see better outcomes for consumers generally. Obviously the airline industry is one that's full of regulations that go back to the beginning of civil aviation in time, you know?

Transport committee  Yes, absolutely, we've seen anti-competitive behaviour in the market. I think it's pretty clear to us that the presence of Flair in the market is threatening to the major carriers, to what we call “big air”: the two big duopoly carriers, WestJet and Air Canada. I think that if you look back at the history you can see the formation of Swoop.

Transport committee  There has been no assistance on those as it turns to predatory behaviour. I think the fact that Flair exists is a product of government policy. I think the 2018 policy that loosened up foreign ownership was one of the things that allowed capital to flow into Flair, and we have a great relationship with the government, but in terms of specific anti-competitive behaviour, there's nothing that I've seen.

Transport committee  Flair—and this was prior to my time—did make a specific complaint around Swoop and Abbotsford, but it came to nothing.