Challenges of Success
Calgary Int'l is prospering, but national issues could thwart growth
By John F. Infanger, Editorial Director
CALGARY - Calgary International is a thriving airport. Since the Calgary Airport Authority (CAA) took over control of the facility in 1992 from Transport Canada (TC), passenger counts have steadily grown, infrastructure has been expanded, and retail and cargo have been recognized with international awards. However, like the other major Canadian airports, its future could be hampered by what CEO Garth Atkinson sees as moves by some in Ottawa to maintain or recapture control of such facilities, which he says has the potential to put a black mark on the success of the transfer of airports program.
48, is a former Transport Canada employee himself, having held several
positions at Toronto's Pearson Airport and at Calgary, where he was involved
in the transfer of the airport from the federal government to the local
authority. Initially the VP of finance and administration at the CAA,
he became CEO in January 2001.
Since the CAA took over control of Calgary International Airport under a long-term lease agreement, it has seen cumulative passenger growth of some 79 percent, moving nearly 9 million passengers in 2000. It is currently constructing its fourth pier (concourse) that will add eleven gates to the existing 22, and will create a "seamless" terminal complex. Air Canada is the predominant carrier here as in the rest of the country, although new entrant WestJet, based in Calgary, has had a significant impact on airline counts.
"We've had arguably the highest growth in the country since 1993,"
says Atkinson. "We're still in a bit of catch-up mode and we've been
going at it seriously for a couple of years. We've got about two more
years of heavy construction."
The impact of the merger of Canadian Airlines and Air Canada was lessened considerably, says Atkinson, with the entry of WestJet in 1996 and by the U.S.-Canada Open Skies agreement in 1993.
"WestJet has grown exponentially," says Atkinson, "and they're still in double digits in 2002 over 2001. The actual growth rate has started to slow, but having said that, WestJet is now a significant air carrier in Western Canada and very significant to Calgary. Market-share-wise, Air Canada has actually dropped down to around 50 percent, whereas nationally they're probably still in the 70 percent range. It's a good competitive air service environment.
"We've seen good growth in what we call the Tier 3 activity as well, which is smaller airlines moving in to service smaller communities with appropriately sized aircraft.
"We're down this year about two and one-half percent, which is extra-ordinarily good news. It's probably the best performance in Canada this year, and Canada generally speaking is doing much better than the United States."
In conjunction with airline growth, the parkade, or parking lot, is having an additional 1,000 stalls added after being expanded by 800 spaces just three years ago. The air cargo apron, completed three years ago, is being expanded by 50 percent, and the airport was recently recognized by the Airports Council International with its top cargo award for North America.
Says Atkinson, "Calgary, because of it's geographic location, is becoming a very large distribution center in Canada." Recent developments have included distribution outlets for Purolator, Staples, and Wal-Mart. The airport's cargo apron is dominated by the movement of livestock, most notably horses for which it developed a special loading facility for charters to Asia. Cargolux also flies to Europe twice weekly from Calgary.
Calgary International has also received accolades, including the top ACI-NA concessions award, for its retail and concessions program, turning the core of a 25-year old terminal into a vibrant retail center that covers more than 75,000 square feet and offers more than 80 shops. Among its features: Spaceport, with a Space Shuttle mockup and moon rock on loan from NASA, space camps for children, and F-16 simulators. The retail growth continues, and the Hudson Group was recently awarded a contract for four additional stores.
The CAC asserts that an expanded mandate for CATSA would divert the authority's attention away from its focus as a service provider in air travel security.
The Calgary-based airline's second-quarter profit hit a record $22.4 million, beating all market expectations.