An Interesting Experiment North of the Border

[BoeingBoy]

If this were a typical tale of a North American airline financial restructuring, Air Canada probably would be readying its employees and lenders for another trip through the corporate steam room to sweat out some more savings in addition to the C$2 billion shed during its year-and-a-half reorganization. Instead, 18 months after emerging from Canada's Companies' Creditors Arrangement Act on Sept. 30, 2004, it is writing a new script and going where no legacy carrier has gone before.

President and CEO Montie Brewer, who joined AC as executive VP-planning from United Airlines in April 2002, says, "Our costs were out of line, but I think a lot of carriers think it's all about costs and has nothing to do with how you approach the marketplace. We thought it was both. We had to get our costs in line and we had to approach the market differently."

The product AC rolled out in the domestic market consists of five branded fares, each with its own price points and attributes. All are sold on a one-way basis right up to the time of departure and none require a Saturday-night stay or advance purchase. They are Tangothe deep-discount product targeted at WestJetTango Plus, Latitude, Latitude Plus and Executive (business) Class.

Passengers who buy a Tango fare know upfront that they have purchased a nonrefundable ticket that does not come with advance seat selection, but for an extra C$15 they can reserve their seat. They only earn 50% of applicable Aeroplan miles and no status miles; however, if they want a bit more they can pay C$30 extra and bump up to Tango Plus and receive advance seat selection plus 100% Aeroplan status miles. And so it goes all the way up to the business class product. "We know we have to compete with the LCCs but we also want to offer the value proposition that if you want these extras, we offer them," Executive VP and CCO Sean Menke explains.

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Jim

 

[Singleflyer]

It is an interesting concept, but hard to understand the different levels the first time on the web page. Our travel department has a hard time with it as well since the software directs them to the lowest price tickets, and they want the class of tickets that have some of the amminities, but not to business

 

[RowUnderDCA]

thank McKinsey

 

[BoeingBoy]

It is an interesting concept, but hard to understand the different levels the first time on the web page. Our travel department has a hard time with it as well since the software directs them to the lowest price tickets, and they want the class of tickets that have some of the amminities, but not to business

Obviously, I didn't book a seat but just a look - it seemed pretty simple...

Once the cities are selected, a page gives all the available flights with the different fare levels beside each. Across the top is the lowest fare for the 5 days before & after the selected date (though not the other fare levels) - clicking on any of those gives the list of flights for that day with the fare levels. Putting the cursor on the name of each fare level and a short synopsis of what you get pops up - refundable or not, upgradeable or not, etc.

If you just want to book a round trip, it certainly seems easier to use than the US site.

Jim

ps - I just looked at YYZ-MIA, but the fares seemed reasonable - max of $800-something each way for "executive" and under $200 each way ($125 on some days) for lowest.

 

[US1YFARE]

It is simple and understandable.

We were all told how simple the fare codes would be after the merger and they seem more complicated than ever. N's and U's and T's and B6's and B's and V's and W's and the list goes on and on--sometimes refundable, sometimes not refundable depending on the market--aye aye aye