Oh, Canada ... the good, the bad, (the rent) ...
Each August we focus on the business of airports in Canada, as evidenced herein. When speaking with aviation officials north of the U.S. border, one can’t help but note a difference when the discussion turns to security and air traffic control.
In Canada, CATSA is responsible for directing the security initiative at airports, and it does so with private sector screeners. One hears little complaining about the security agency, although more funding comes up at times. Larry Berg, president and CEO of Vancouver International, comments, “CATSA has been providing sufficient infrastructure to where pre-board screening isn’t a bottleneck to processing passengers.”
Then there’s ATC, which was privatized and put into the hands of NAV CANADA, which is a private non-share capital corporation financed through publicly traded debt. It took over air traffic service in 1996, buying the system from the feds.
When NAV CANADA took over ATC, it was widely criticized, particularly in the U.S., as a bad idea, one that would bring high prices and questionable modernization.
In fact, just recently NAV CANADA announced that for the third consecutive year it was reducing rates. And, Canada is in the midst of system-wide implementation of ADS-B, the linchpin of FAA’s NextGen system.
Now, think for a moment about the U.S. ATC system. The controllers and FAA are at each other’s throats. Every time there is an incident there is the requisite finger-pointing, with the public left to wonder where the truth lies. This industry has enough challenges without mainstream passengers fearful that the system will fail next time they get on an airliner.
Of course, in the U.S. the predominant view is that we have little to learn from the lessons of Canada — it’s all about scale. Perhaps; but vehement battles with labor aren’t the norm, and while the U.S. talks of modernizing, Canada is doing it.
But all is not well, eh?
One of the great success stories to the north has been the transfer of operation of Canada’s airports to local authorities (the major airports, that is), exemplified by this issue’s cover story.
In Canada, however, they don’t have a nationwide Airport Improve-ment Program, and those local airports pay a ton of loonies into the general coffers of the federal government in the form of rent (see cover chart). Government grants? Get outta here.
The bottom line, says Berg, is that it may be time to find a new model for operating airlines and airports.
“Some of these sacred cows have to be rethought; it’s a global business and it’s very competitive. North America has a way to go.
“We need to allow the industry to make global commercial decisions that make sense and remove the barriers. They [the airlines] don’t need a regulation to help them.”
Thanks for reading.
