Three years after its takeover, the integration of Canadian Airlines into Air Canada is effectively done. The merger of those arch rivals stands as an object lesson on how much can go wrong, but the stormy process is now largely history.
Recent events confirm the end of the transition. After a year of negotiations, flight attendants from Air Canada and Canadian ratified the first labour contract to cover both groups.
As recently as November, they were still fighting over seniority, which has plagued relations between Canadian and Air Canada staff since the takeover. A challenge is still pending over pilot seniority issues, but bringing staff under a single contract has a symbolic effect.
Air Canada's Jazz has started pulling out of some regional routes, signalling the end of another transition issue. When Air Canada took over Canadian it promised lawmakers it would continue flying to communities previously served by the two mainline airlines or their subsidiaries, until 4 January 2003.
The withdrawal now under way is mostly in the maritime provinces. A commitment by Quebec's government for its personnel to fly Jazz has preserved service to some small cities there.
Customer complaints, which soared after the takeover, have also dropped. Three years ago things were so bad Ottawa appointed an Air Travel Complaints Commissioner.
Until recently, Air Canada and its growing list of subsidiaries have controlled around 80% of the domestic market. That percentage climbed after the collapse of Canada 3000 in November 2001, but has recently fallen to 70.5% with the growth of WestJet and the launch of CanJet and Jetsgo.
Surprisingly, a study done for the Canadian Transportation Agency finds that Air Canada has not exploited its dominance to raise fares as many feared. The study shows Air Canada's fares on western Canada routes are generally lower than they were before the merger, even on monopoly routes.
Source: Airline Business
