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Air Canada sitting on $2.6 billion of passenger money as House of Commons petition to refund passengers gains support.

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Air Canada sitting on $2.6 billion of passenger money as House of Commons petition to refund passengers gains support.

New article in the post. Hopefully the government pays attention. However it seems to me that when you are elected in this country you get two things during your back room briefing. One is you’re provided with the state secrets that none of us are privy to including the hot codes. Two: you are told that banks, insurance companies and airlines are 100% off limits when it comes to making them cough up for anything. They are in the brotherhood. Like the Masons.
https://nationalpost.com/news/politics/ ... o-covid-19

Link to the petition:
https://petitions.ourcommons.ca/en/Peti ... ion=e-2604
Last edited by benjicash on May 22nd, 2020 2:03 pm, edited 4 times in total.
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Finally makes it into the news :)
It will be interesting what public pressure will do.

When you think about what the government is doing, doling out cash to almost everyone that asks, why not to voucher holders. Some can get EI, CERB, and return of voucher funds too. :)
Last edited by Pete_Coach on May 21st, 2020 5:39 pm, edited 1 time in total.
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benjicash wrote: Air Canada sitting on $2.6 billion in passenger money.
That's only part of the story. This about more than just AC and their $2.6B hoard. It would be nice if you could change the thread title to reflect the actual headline. Thanks.

The actual headline is more meaningful: Growing number of Canadians furious that airlines won't reimburse for travel cancelled due to COVID-19
OTTAWA — A growing chorus of voices is demanding Ottawa force airlines to reimburse cash-strapped travellers the cost of trips that were cancelled because of the pandemic, rather than offering a 24-month travel credit.

Just on Wednesday, support for a House of Commons petition demanding the federal government require airlines to refund trips jumped from 500 in the morning to well nearly 5,900 by late afternoon...

“These travel credits come with restrictive terms and conditions, including that they must be used within 24 months, that they are non-transferable or that they do not provide any price guarantee,” the petition reads...

“I don’t think that it’s up to the average citizen to put up $5,000, $10,000 or even $15,000 to keep a company afloat when they’d like to be able to pay their mortgage or buy groceries after possibly having lost their job. It’s not a simple situation for many people,” the Bloc’s transportation critic said.
I raised this and related issues on another thread that's now been locked because of unrelated digressions and squabbling. FWIW:
Here's my concern...

First, I appreciate that airlines are cash-strapped due to C-19. I get that they could go broke if everyone insisted on a cash refund.

A voucher is effectively a loan from a consumer to an airline. But what a great deal it is for the airline (and what a sucker bet it is for the passenger)!

1. It's interest free. If the voucher remains valid for 24 months and I then book a flight for a year after that then it could be as much as 3 years interest-free.

2. People who've lost their jobs and now can't pay their mortgage/rent may have to take out loans at high interest rates while they're effectively loaning that money back to the airlines interest-free. That makes no sense.

3. It's a very high risk loan. After all the airline stands a high probability of going broke as the result of C-19, making the voucher worthless.

4. Even if the airline doesn't go broke they could curtail their routes such that we can no longer get from X to Y on that airline. In that situation the voucher is either worthless or worth less. We'd have to either fly entirely on another airline or fly partly on another airline, in both cases at our extra expense.

5. When we booked the flight and paid for it we entered into a contract with the airline to fly us from X to Y for $N. Now when the airline starts flying again it will likely raise airfares using C-19 as the pretext. But the voucher will be for the $N I originally paid. So in effect that voucher won't be nearly enough to pay for the flight from X to Y that we contracted and paid for.

6. Further re 5. airlines have a notorious track record for screwing passengers in creative but abusive ways. They've devalued frequent flyer miles many times. They've introduced fuel surcharges when oil price spiked up and then kept them even after the price of fuel dropped. They've applied those surcharges on "free" reward tickets. Etc. Why should anyone assume they won't find some new ways to devalue C-19 vouchers? An obvious example would be to impose a C-19 surcharge because they can't cram as many sardines in the can as they used to.

It seems to me that if an airline wants me to accept a risky voucher of undetermined actual value instead of a full cash refund then they should compensate me for the above issues. Instead of a fixed value ($N) the voucher should be for transporting me from X to Y irrespective of what the airfare might be a year or two or three in the future. I appreciate there would have to be some constraints on this like same fare class, same time of year, equivalent destination if they no longer fly from X to Y, etc. But these are details. They can be addressed.

Frankly I'm surprised that the passenger rights advocates, media, etc. haven't cottoned on to this potential for airline subterfuge. [Well it seems they finally have...Bylo
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I signed the petition
Benji I think you picked the wrong title for this thread
The thread should have said " Support for a House of Commons petition demanding the federal government require airlines to refund trips"

The numbers are going through the roof, it was 5900 signatures or so yesterday , today is 10000 just in Quebec alone

Province / Territory Signatures
Alberta 684
British Columbia 772
Manitoba 114
New Brunswick 118
Newfoundland and Labrador 66
Northwest Territories 8
Nova Scotia 216
Nunavut 5
Ontario 1920
Prince Edward Island 18
Quebec 10042
Saskatchewan 84
Yukon 5


Interesting maths here:
2.6 billion / 20 000 workers laid off=one hundred thirty thousand per worker.
130K/year that is high pay salary
so if you take an average 65K/year salary for that money you could feed 40K employees for a year


Financial reports in February 2020
Record operating revenues of $19.131 billion
Operating income of $1.650 billion
EBITDA of $3.636 billion and EBITDA margin of 19 per cent
Record unrestricted liquidity of $7.380 billion and leverage ratio of 0.8
Last edited by CuriousC on May 21st, 2020 2:26 pm, edited 2 times in total.
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CuriousC wrote: I signed the petition
As did I, CCing my MP as well as the retired rocket scientist in charge of the Transportation file.
Benji I think you picked the wrong title for this thread
Agreed. Perhaps even add "Petition" to the title so as to get maximum attention to that aspect too.
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bylo wrote: As did I, CCing my MP as well as the retired rocket scientist in charge of the Transportation file.

Agreed. Perhaps even add "Petition" to the title so as to get maximum attention to that aspect too.
Title changed. I think the 2.6 billion is important to keep.
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...it would be the end of Air Canada and Westjet.
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Meanwhile, Ottawa assists carriers, without requiring them to reimburse their customers as the United States and the European Union have done (Air France has just announced that Canadian customers could choose between a refund and an enhanced credit, a solution that could serve as a model for us).

For example, Air Canada will receive the emergency wage subsidy which insures up to 75% of employee wages. The company obtained a $ 788 million loan from Export Development Canada. In addition, she should be eligible for the Emergency Credit for large employers.
https://www.lapresse.ca/affaires/202005 ... oVYIhQEhfw
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Unfortunately I got tied up into this today. My flight to Japan in OCTOBER got canceled....premature much? Seems like things are about to open up, I figured shit might become a bit normal, but instead my flights got canceled. They are offering me a refund for everything minus $400 in fees, or a full value credit for 24 months. Says I have 24 months from "YOUR" date of cancellation because they make you go through the process and choose....but since my flight is 5 months out...i won't bother cancelling now. Perhaps something will change and they make them give full refunds instead....or maybe the flight will come back on the schedule. It does still say they will re-book you on the main page where they announce the cancellation after logging in, but perhaps that's just old code from normal times.
JapanTripCancellation.JPG
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eblend wrote: Unfortunately I got tied up into this today. My flight to Japan in OCTOBER got canceled....premature much? Seems like things are about to open up, I figured shit might become a bit normal, but instead my flights got canceled. They are offering me a refund for everything minus $400 in fees, or a full value credit for 24 months. Says I have 24 months from "YOUR" date of cancellation because they make you go through the process and choose....but since my flight is 5 months out...i won't bother cancelling now. Perhaps something will change and they make them give full refunds instead....or maybe the flight will come back on the schedule. It does still say they will re-book you on the main page where they announce the cancellation after logging in, but perhaps that's just old code from normal times.
DO NOT CANCEL, no matter what!
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CuriousC wrote: DO NOT CANCEL, no matter what!
Elaborate please. I am not planning on doing it anytime soon....but I haven't been following all this news as I didn't think it would impact me now...with flights so far in advance.
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eblend wrote: Unfortunately I got tied up into this today. My flight to Japan in OCTOBER got canceled....premature much? Seems like things are about to open up, I figured shit might become a bit normal, but instead my flights got canceled. They are offering me a refund for everything minus $400 in fees, or a full value credit for 24 months. Says I have 24 months from "YOUR" date of cancellation because they make you go through the process and choose....but since my flight is 5 months out...i won't bother cancelling now. Perhaps something will change and they make them give full refunds instead....or maybe the flight will come back on the schedule. It does still say they will re-book you on the main page where they announce the cancellation after logging in, but perhaps that's just old code from normal times.

JapanTripCancellation.JPG
Is that for one or two tickets? Did you pay using a cc with travel insurance?
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eblend wrote: Unfortunately I got tied up into this today. My flight to Japan in OCTOBER got canceled....premature much? Seems like things are about to open up, I figured shit might become a bit normal, but instead my flights got canceled. They are offering me a refund for everything minus $400 in fees, or a full value credit for 24 months. Says I have 24 months from "YOUR" date of cancellation because they make you go through the process and choose....but since my flight is 5 months out...i won't bother cancelling now. Perhaps something will change and they make them give full refunds instead....or maybe the flight will come back on the schedule. It does still say they will re-book you on the main page where they announce the cancellation after logging in, but perhaps that's just old code from normal times.

JapanTripCancellation.JPG
Did AC specify why they canceled? Seems a bit weird considering they themselves said they'd be opening up some flights next month.
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Perhaps we should offer the Canadian Revenue Service a voucher in lieu of payment of income tax? I can only imagine the response!
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squall458 wrote: Is that for one or two tickets? Did you pay using a cc with travel insurance?
That's for 2 tickets. I think the CC I used has Travel Insurance. It's the PC Financial World Elite Mastercard.
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uber_shnitz wrote: Did AC specify why they canceled? Seems a bit weird considering they themselves said they'd be opening up some flights next month.
"We regret to inform you that AC39 from Vancouver, International (YVR) to Osaka, Kansai International (KIX) on October 03, 2020 has been cancelled due to the impacts of COVID-19, government travel advisories and/or health and safety concerns."..same deal for my flight to Vancouver out of Calgary.
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eblend wrote: "We regret to inform you that AC39 from Vancouver, International (YVR) to Osaka, Kansai International (KIX) on October 03, 2020 has been cancelled due to the impacts of COVID-19, government travel advisories and/or health and safety concerns."..same deal for my flight to Vancouver out of Calgary.
They are going to be using covid as a blanket excuse to cancel flights for a long time.
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benjicash wrote: Title changed. I think the 2.6 billion is important to keep.
I'd be curious to know why you think the $2.6B is so important. Yes it's a large number. But what is it as a percentage of AC's expenses?

I got a reply to an email I sent to the petition's sponsor. He puts that number in a bit better context, claiming that it's less than half of the cash they have on hand. Nevertheless, as large a number as it may be, consider that AC has to keep making payments on a fleet of planes they can't fly, paying rent to airports for space that's not being used and paying for staff that aren't working or not working at full tilt. It would be nice to see how that $2.6B factors into their total spending rather than citing it in complete isolation.

I've cleaned up the English a bit (his English is still a lot better than my French ;))
Air Canada has about 6 billion dollars in their account, so giving back around 2 billions for the unused fares will not damage them too much. They are also getting a boost from the federal to pay the employees. The other thing is that a lot of their planes maintenance is done out of Canada so would be better to take care of our own before spending that money elsewhere.
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CuriousC wrote: Interesting maths here:
2.6 billion / 20 000 workers laid off=one hundred thirty thousand per worker.
130K/year that is high pay salary
so if you take an average 65K/year salary for that money you could feed 40K employees for a year
1. AC also has to pay for its fleet, airport space and various other committed expenses.
2. I don't know how they buy fuel. Presumably it's by futures contracts to guarantee costs. If so they've committed to a much higher price than the spot rate today. And are they obligated to buy it if they don't need it? Etc.
3. Keep in mind that even $130k/employee isn't very informative. To a pilot that's low. To an agent or baggage handler that's probably several times what they earn.
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