Winnipeg Free Press - PRINT EDITION

'Peg part of Porter expansion

Hopes to be third national airline; needs Toronto runway extension

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Toronto-based Porter Airlines could be flying in and out of Winnipeg as early as 2016 if an ambitious expansion plan to become Canada's third national carrier is approved.

The upstart airline announced Wednesday it has signed an agreement to buy a dozen new Bombardier CS100 jets. It plans to use them to expand its service to more than a dozen new North American destinations, including Winnipeg by as early as 2016 when it expects the first of the new planes to be delivered.

But the company faces several significant challenges as it seeks to change the rules and extend the runway at the small Toronto waterfront airport where it's headquartered.

Porter president and chief executive Robert Deluce said he's so confident his airline will prevail that he doesn't have a backup plan.

Deluce also said he expects to have all the needed approvals within six months -- or by the end of the year at the latest -- for the expansion, which will help create 1,000 new jobs.

However, locals have opposed plans to expand the Toronto island airport in the past because of concerns about noise as well as the effect on wildlife. Air Canada also has challenged the awarding of takeoff and landing slots at the airport.

Jets are not allowed to fly out of the Billy Bishop Toronto City Airport, which is on an island near the lakefront, except under special circumstances. The rules are part of a tripartite agreement between the City of Toronto, the federal government and the Toronto Port Authority -- making it difficult to get quick action from the necessary authorities.

Porter started flying in October 2006 and serves 19 destinations in Canada and the United States. Deluce said the airline plans to fly the new jets to destinations its current fleet of turboprops can't reach, including Winnipeg, Calgary, Edmonton, Vancouver, Los Angeles and Florida.

A spokeswoman for the Winnipeg Airports Authority, which operates Winnipeg's Richardson International Airport, said it has been courting Porter for more than a year and is encouraged by Wednesday's announcement.

"We would gladly welcome a new airline partner to Winnipeg, as it would increase flight options available to customers," Breanne Talbot, a communications specialist with the WAA, said. "We're excited about the potential it could mean for travellers: better competition, more choices and potentially lower air fares down the line."

Analyst Robert Kokonis said there's a big risk Porter's plans will never happen because of opposition from Toronto residents and environmentalists.

"That would be a big win if all the chips fall in the right place, or it could end up being a disaster," the president of airline consulting firm AirTrav Inc. said.

He also said Porter's planes have been flying less full while load factors at rivals WestJet Airlines and Air Canada have been improving.

"In a zero-sum game where they're all chasing the same passenger, it does give one pause for concern that Porter might be struggling in some areas."

Analyst Chris Murray of PI Financial Corp. said while Porter's move would allow it to expand its reach, the limited additional capacity wouldn't change the Canadian airline market much.

"It's still a niche model," Murray said.

Porter's announcement came as it confirmed the signing of a conditional deal to buy 12 Bombardier CS100s, with options on 18 more. The deal also includes purchase rights for six Bombardier Q400s, and the total purchase price could reach US$2.29 billion if all the options and purchase rights are exercised.

Deluce said the airline chose the new Bombardier CSeries aircraft and its current fleet of Bombardier Q400 turboprops because of their quiet operation.

The Toronto Port Authority said it wouldn't take a position on Porter's business plans until Toronto City Council makes its views known.

Air Canada said before it takes a position on further investment at the island airport, it wants assurance slots will become available for other airlines that have been seeking increased access, including Air Canada.

WestJet Airlines did not directly address Porter's plans, but said it remains focused on keeping its own business.

 

-- staff / The Canadian Press

Republished from the Winnipeg Free Press print edition April 11, 2013 B4

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