Canada's Aviation Policy Under Review

Canada’s aviation market is very different from its larger southern neighbour. It is a seemingly solid duopoly domestically and, unlike the US’ liberal policy, is a global standout for protectionism internationally. Attempted new domestic entrants have not been successful and Canada’s newly released policy document notes that "Canada is the only major air market without an ultra-low-cost carrier” and implies a move to allow 49% foreign ownership would help to rectify this failing; but meanwhile both Air Canada and WestJet have established long haul low cost operations. The policy document also raises the prospect of changes to airport ownership and control, a relatively innovative change. This would substantially alter the way the airports operate. To become more commercial, the airports may need to reclaim some of the traffic that is currently diverted over US hubs due to Canada’s restrictive access regime.

• Is there room in Canada’s domestic market for new ULCC entrants?
• How would the proposed new airport ownership policy change the aviation scenario?
• Are consumers’ interests adequately represented in the Canadian system?
• Does Canada’s international aviation policy best serve its national interest?