Canadian Government announced (25-Feb-2010) plans to provide CAD1.5 billion (USD1.4 billion) over five years to the Canadian Air Transport Security Authority (CATSA) to enhance Canadian aviation security, through Canada's Air Travellers Security Charge (ATSC). Government of Canada also announced plans to launch a full review of the spending, efficiency and structure of the CATSA. The ATSC will increase to match the demand of security costs, with innitial user fee rates ostarting at CAD2.58 for one-way domestic services, CAD4.37 for transborder services and CAD8.91 for other international services. Canadian Airports Council stated (25-Feb-2010) it is committed to working with Minister of Transport on review of the Canadian Air Transport Security Authority (CATSA) despite being disappointed at an increase in the Air Travellers Security Charge (ATSC). [more - Canadian Government] [more - CAC]
Canadian Government enhances air traveller security
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Cathay Pacific adds A350 to Vancouver, preparing for Hong Kong Airlines' long haul entry
Cathay Pacific's fortunes have been weakened in recent years as competition mounts, mostly from greater regional capacity, some of which feeds other airlines' long haul hubs. Locally Cathay has faced home market competition from Hong Kong Airlines and LCC HK Express, which together have weakened Cathay on its regional services. Yet Cathay has been relatively insulated from the growing direct competition on long haul routes, which have supported its network in recent times and account for a high share of revenue.
Hong Kong Airlines is growing long haul to Australia and New Zealand, but its major threat to Cathay is on North American and European routes, to be launched with forthcoming A350s. Cathay appears to be making a pre-emptive strike by deploying its attention-getting A350 to increase flights to Vancouver, which Cathay expects to be an early Hong Kong Airlines destination.
This is the first time that Cathay is growing Vancouver since the entry of Oasis Hong Kong in 2007. After Oasis' subsequent collapse Cathay withdrew the additional capacity it had mounted. Hong Kong Airlines, however, has stronger backing – HNA – and is already known in the territory. Hong Kong Airlines' impact is guaranteed, but the question is to what extent. This depends on how Hong Kong Airlines sharpens as it becomes the city's second flagship airline.
Singapore Airlines promotes ASEAN-EU/Japan/Korea open skies to gain more USA fifth freedom flights
Linking Asia with North America has been the market cornerstone for Korean Air and Cathay Pacific while producing a growth market for relatively new entrants like ANA and EVA Air. Yet, while northeast Asian airlines have the geography for profitable nonstop North America flying, southeast Asian airlines are challenged in serving the route.
Singapore Airlines feels the need for a significant North American presence to diversify its network and offset pressure from Gulf airlines, which have profoundly weakened SIA in its core Asia-Europe and Australia-Europe markets. Although Singapore Airlines plans to resume nonstop North American flights, these are token services for strategic purposes.
The primary objective has to be securing more fifth freedom rights for one-stop service. Singapore is encouraging the ASEAN bloc to secure open skies with Japan, Korea and the EU since open skies will entail unlimited fifth freedom rights. Korea is unlikely to agree, with Japan hesitant. Fifth freedom liberalisation is a contentious item in the otherwise benign EU-ASEAN negotiations. Countries worry that granting unlimited fifths opens Pandora's box to growth – not just from SIA, but any number of airlines that are quiescent today but could aspire to be powerhouses in the future.