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Air Canada employee says staff trained to ‘dupe’ passengers at risk of being bumped from oversold flights

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A pair of Air Canada insiders are shedding light on the airline’s policy of overselling flights, revealing what they say is a widespread practice of duping passengers into believing they have a seat on a plane and stringing them along until the last possible moment.

As a way to try to maximize revenues, airlines are allowed to sell more plane tickets for a flight than there are available seats, but the former and current ticket agents who spoke with Go Public say Air Canada is less than transparent with customers who are likely to be denied boarding because a flight has been oversold.

“It’s never fun to have to lie to people,” said the former customer sales and service agent, who worked at Air Canada’s check-in counter at Vancouver International Airport for several months before quitting just over a year ago.

“I had to tell people over and over again that they were gonna get on the plane, when I knew that they might not.”

The other insider, a longtime Air Canada ticket agent who still works for the airline and trains employees, says he is now one of the people teaching new agents to not be forthcoming.

“I say to the new hired agents, ‘You can’t put up with confrontation all day long. If someone has ‘GTE’ [for “gate”] on their boarding pass, it means they don’t have a seat. But if you explain that to them, they’ll get upset. So just send them to the gate,'” he told Go Public.

“I train people to dupe passengers.”

The day he spoke with Go Public, he said he’d pointed dozens of Air Canada customers to a gate knowing they didn’t have a seat.

CBC has agreed not to identify the current and former Air Canada employees because doing so could jeopardize their current employment.

Air Canada says the practice of overselling is carefully managed, and employees are trained to be transparent with customers.

‘Every route could be oversold’

The former Air Canada agent said he contacted Go Public because he wanted travellers to know how often staff are forced to scramble to find seats for passengers stuck on oversold flights.

“I was shocked,” he said. “I had no idea that Air Canada was doing this at this scale.”

I told them they had nothing to be worried about, and it absolutely killed me.– Former Air Canada ticket agent

It didn’t matter if passengers were flying within Canada, to the U.S. or overseas, he said. 

“Every route could be oversold.”

‘It absolutely killed me’

The former agent says he quit because he couldn’t take the stress of constantly misleading customers.

As an example, he tells the story of an excited family flying together for the first time. When they checked in, their boarding passes didn’t have assigned seats.

“I just felt awful about it, but I had to say that they were going to have a great trip, and push them through [to the gate],” he said.

“They ended up not getting on. I tracked them, and they were bumped. It was the last flight out that day.”

A former Air Canada agent tells Go Public’s Erica Johnson that he became so distraught about lying to passengers about overbooked flights, it took a toll on his health. (Dillon Hodgin/CBC)

He remembers a couple on their way to a honeymoon in Hawaii, who didn’t have confirmed seats on an oversold flight.

“I told them they had nothing to be worried about, and it absolutely killed me,” he said. “The chances of them making it on [the flight] were slim to none.”

In another case, a passenger who was on his way to have life-changing surgery in Alberta the next day stood a good chance of getting bumped from a flight, he said.

“I had to do a complimentary upgrade to make it happen — which is something that I shouldn’t have done. But at the end of the day, he needed to get on that plane.”

Your seat ‘will be assigned at the gate’

The former agent says he was told during training not to inform customers at the check-in counter that the reason they don’t have an assigned seat is because the flight was oversold.

“Nobody wants panic from the second of check-in. That’s not fun for the company to have to deal with,” he said. 

“I really wasn’t able to tell people exactly what was going on and give them the full picture. They were strict about that. We’re trained to tell them that … they have nothing to worry about.”

He says he also felt badly for colleagues working at the gates, who had to deal with passengers once they learned the flight was oversold and they didn’t have a seat.

Air Canada responds

Go Public requested an interview with Air Canada, but the airline declined.

In an email, spokesperson Angela Mah disagreed with many of the allegations made by the current and former Air Canada employees, and dismissed the impact of overselling.

“Overselling … accounts for less than 1 per cent of passengers booked,” wrote Mah, explaining that the airline flew approximately 51 million customers in 2017/18.

Air Canada says overselling ‘benefits customers by keeping fares lower’ and allows the airline to operate less-travelled routes. (Pat Fogg/CBC)

That one per cent amounts to 510,000 tickets oversold, but Mah says only a fraction of that number results in customers being denied boarding because “several million customers per year no-show.”

Mah pointed out that overselling is approved by the Canadian Transportation Agency and is a “common practice amongst many international network airlines to ensure the maximum number of seats are filled on a departing flight.”

Overselling “benefits customers by keeping fares lower” and allows the airline to operate less-travelled routes, Mah said.

She also said the bigger reason passengers end up with no seat on a plane is due to “overbooking” — when an aircraft is replaced with a smaller plane, for a host of potential reasons including mechanical issues. 

She would not confirm how often this happens, saying those numbers are “commercially sensitive” and an unavoidable reality for all airlines — including Air Canada’s competitor, WestJet. 

WestJet told Go Public it does not “intentionally oversell” seats.

Internal documents obtained

Internal documents on Air Canada’s employee website explain that the airline oversells flights because its management team “is tasked with ensuring that the maximum revenue potential is made on each and every flight.”

In 2017, Air Canada reported a profit of $2.04 billion, more than double what it earned the previous year. Figures for 2018 will be released shortly.

The website says the airline “uses a sophisticated system” to “calculate the acceptable level of oversell risk.”

It then explains what Air Canada agents should do in the event there are more passengers than seats for a flight.

A screenshot of an internal Air Canada website. It instructs agents to ‘make the compensation sound as attractive as possible’ when trying to entice passengers to give up their seats on oversold flights.

“When flights are oversold there is certainly a level of stress for both the gate agent and customers involved,” the website says.

“Soliciting volunteers to travel on later flights not only fulfills our legal requirements, but may also assist the gate agent in alleviating some of that stress. Making announcements for seeking volunteers [to give up their seats] makes a positive impression on our customers, by demonstrating that we are trying our best to accommodate all of our customers.”

The Air Canada agent who works in a busy airport says accommodating customers can sometimes be extremely difficult.

“It’s hell for us to have to turn these passengers away,” he said.

“Kids are crying. Saying, ‘Daddy, you promised we’d be [there] for dinner’ and I have to explain that the flight is oversold.”

Business passengers are ‘most valuable’

Fred Lazar, an airline industry analyst and associate professor of economics at York University’s Schulich School of Business, says one reason passengers might get bumped from a flight is because Air Canada has focused on servicing the country’s business sector — frequent flyers who want an international network of flight options and often pay premium fares for the flexibility of changing their flights last minute.

“Top-tier passengers are the most valuable,” Lazar said. 

“So [the airline] will bend over backwards to accommodate them, even if it means bumping some basic economy passengers from the airline and enduring the bad publicity for a short time.”

Airline industry analyst Fred Lazar says airlines accommodate their elite customers first. The passengers most likely to be bumped, he says, are infrequent, economy-fare flyers. (Joe Fiorino/CBC)

The former Air Canada agent who spoke with Go Public says one way to ensure you have an actual seat on a plane is to log on to Air Canada’s website 24 hours before the flight to choose a seat. Or, pay a fee for seat selection when you buy your ticket.

“Anyone who has a seat assigned to their ticket when they get to the airport never has to worry about being put on standby,” he said.

Harder to claim compensation

Regardless of why an airline has more passengers than seats on a flight, new federal airline regulations coming down the runway will make it harder for travellers to claim compensation if they’re denied boarding, says Gabor Lukacs, founder of a Canadian advocacy group called Air Passenger Rights.

Currently, airlines must seek volunteers to give up their seats before denying anyone boarding. Passengers who are involuntarily bumped are entitled to compensation — up to $1,350 — depending on the airline, destination and length of the delay.

The new proposed regulations provide higher compensation, but require the passenger to prove they were denied boarding due to an oversold flight caused by a situation within the airline’s control.

“This is impossible to show,” Lukacs said.

“Passengers don’t have access to the airline’s reservation system. They don’t know how big the aircraft is. They don’t know how many seats were sold. Moreover, in situations where the airline moves passengers against their will to other flights, it is going to look as if the flight was not oversold.”

Air passenger rights advocate Gabor Lukacs says the federal government’s new proposed regulations will make it difficult for passengers to get compensation after they’ve been involuntarily denied boarding because the airline oversold a flight. (David Laughlin/CBC)

Lukacs says Canada should be emulating European standards, where anyone with a valid ticket who doesn’t get on their plane is considered to have been denied boarding — and is eligible for compensation.

“In Canada there is no excuse for drafting a definition so narrowly that people who pay their hard-earned dollars for their seats won’t get compensated when they are denied boarding on their flight,” he said.

‘Heavy penalties’ coming

Minister of Transport Marc Garneau says the new regulations won’t ensure everyone has a guaranteed seat, but will hold airlines responsible for denied boarding.

“They’re not going to get out of anything,” Garneau told Go Public, pointing to stiffer penalties in the new regulations.

He says there will be “heavy penalties” if a passenger is denied boarding because the airline oversold its flight — in some cases up to $2,400.

Email campaign

Lukacs says bigger fines are meaningless if passengers can’t prove they qualify for compensation.

His organization has started an email writing campaign for people to tell the federal government that the proposed air passenger rights regulations are inadequate.

So far, almost 5,000 people have participated in the campaign. The deadline for public feedback on the draft regulations is Feb. 20.

“Canadians are fed up with how airlines treat them,” he said.

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Go Public is an investigative news segment on CBC-TV, radio and the web.

We tell your stories and hold the powers that be accountable.

We want to hear from people across the country with stories you want to make public.

Submit your story ideas at Go Public.

Follow @CBCGoPublic on Twitter.

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Hong Kong protests create potential problems for Ottawa, says academic

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There are four or five flights a day from Vancouver to Hong Kong during the summer season. When they land this weekend, passengers will be met by a sea of protesters staging a three-day occupation of the Hong Kong airport’s arrivals hall.

The protesters are seeking international attention as the city enters its tenth straight weekend of political demonstrations that have, at times, been chaotic and violent.

Airport authorities are taking extra security measures and the Canadian government has raised its travel advisory.

Aside from monitoring local media and avoiding areas where large protests are unfolding, there are several issues for Canadians and Ottawa to consider.

“It’s a perfect storm of domestic tensions playing into international views on Beijing’s intentions and policies,” said Paul Evans, a global affairs professor at the University of B.C. “The dissatisfaction fuelling the protests is, in part, about feelings about freedom, democracy and Hong Kong’s autonomy. But it is also about material concerns related to housing, social services and career prospects.”

The oft-quoted number of Canadian passport holders in Hong Kong is about 300,000. This is an estimate made in 2011 by the Asia Pacific Foundation, which, at the time, said it was based on “conservative assumptions” and that a higher estimate would be over half a million.

There are concerns that, should the situation spiral out of control, there would be protection issues for the federal government to manage. After the Tiananmen Square massacre in Beijing in June 1989, several thousand Canadians were airlifted out of China. But the large number of Canadians in Hong Kong would make evacuation and consular protection much more challenging.

A more immediate issue is Ottawa’s response to the prospect of protesters fleeing arrest by Hong Kong authorities and seeking refuge in Canada.

“Vancouver is already in the global spotlight as a result of the (Huawei executive) Meng Wanzhou arrest and hearings,” said Evans. “Considering the huge number of connections between the two cities, managing requests for political asylum has the potential to put Vancouver in the spotlight in an even bigger way.”

Despite the advisory, many in Hong Kong report a sense of order now that they have adjusted and life is continuing around the protests.

“Local social media is providing good updates regarding the locations and times of the protests,” said Eric Li, a professor of marketing at the University of B.C. Okanagan who is visiting family in Hong Kong and doing some research.

He added that some visitors might be getting limited information if they are only relying on official announcements from government channels.

Li said he feels safe, but “there has been more tension and conflict between the government and police and citizens as well as businesses. The pro-(Beijing) camp and protesters are criticizing each other and there are also (arguments) within families and between friends and colleagues.”

Li has been trying to be “neutral” as a “personal choice. As a person who calls Canada ‘home,’ and Hong Kong ‘my hometown,’ I should say the young protesters are very well-organized and disciplined. The government should actively engage youth in their planning rather than excluding them in the process or putting them in an opposition position.”

“It’s crucial for the Hong Kong government to take a few steps to resolve conflicts through providing open conversation with key stakeholders and young leaders. And protesters should remind themselves the purpose of the (protests) as well as the consequences of their (actions).

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PROREIT buying office, industrial buildings in Ottawa, Halifax

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(PROREIT) will use some of the proceeds from its latest, and largest, share offering to help it purchase two office and industrial properties in Ottawa, and five industrial properties in Halifax for $97.8 million.

(PROREIT) will use some of the proceeds from its latest, and largest, share offering to help it purchase two office and industrial properties in Ottawa, and five industrial properties in Halifax for $97.8 million.

“These acquisitions provide meaningful increases in our industrial sectors and expand our presence in Ontario and the strengthening Halifax market,” president and chief executive officer James Beckerleg told RENX.

PROREIT (PRV-UN-T) is acquiring a fully occupied boutique office building in Ottawa’s central business district. It’s surrounded by tourist sites, multiple restaurants and retail offerings.

PROREIT is also purchasing a class-A mixed-use, multi-tenant flex industrial property in the west-end Ottawa suburb of Kanata. It includes an office and a research and lab facility with what the trust calls exceptional power, air handling and cooling specifications.

The building is fully leased and its tenants are in the material sciences, defence, communications and medical technology fields.

The two Ottawa properties have a combined gross leasable area of 338,000 square feet and a weighted average lease term of 6.6 years. Many of the leases include contracted rent steps.

While the property addresses and additional details are confidential until the deals close, which is expected this quarter, Beckerleg said they’re both institutionally owned and have been maintained to high standards.

The addition of the Ottawa properties will increase PROREIT’s portfolio exposure to the Ontario market to 29.1 per cent by gross leasable area and 29.3 per cent by base rent, making it the REIT’s largest provincial market. It increases the Ottawa portfolio to approximately 620,000 square feet.

“We entered the Ottawa market with our $52-million portfolio acquisition of five office properties last year,” said Beckerleg. “This fits our strategy of investing in strong markets where we can increase our exposure to both of these industry sectors.

“Ottawa is seeing significant growth in office and industrial properties.”


PROREIT’s new Halifax acquisitions

PROREIT has a contract to acquire five light industrial buildings with clear heights of between 18 and 24 feet in Halifax’s Burnside Industrial Park. The portfolio represents 358,000 square feet of gross leasable area.

The buildings are 93 per cent occupied with a weighted average lease term of 4.1 years. Many of the leases include contractual rent steps.

While more details won’t be made available until the deals close, which is expected this quarter, Beckerleg said the condition of the buildings is similar to its Ottawa office purchases. The five buildings have been institutionally owned and maintained at a high level.

“The Halifax industrial market has enjoyed declining vacancies in line with the expanding Halifax economy,” said Beckerleg. “There has been a marked increase in institutional interest in the Halifax industrial sector.

“We like this market. Again, it fits our strategy of focusing on mid-size cities with strong investment metrics.”

PROREIT’s $50-million offering

As part of its funding for the purchases, PROREIT will issue 7.15 million shares on a bought-deal basis at a price of seven dollars per unit, for gross proceeds of approximately $50 million, to a syndicate of underwriters.

PROREIT has also granted the underwriters an over-allotment option to purchase up to an additional 1,072,500 units on the same terms and conditions, exercisable at any time, in whole or in part, up to 30 days after the closing of the offering. It’s expected to close on or about Aug. 16.

“This capital raise, our first since graduating to the TSX, is the largest in PROREIT’s six-year history,” said Beckerleg. “We believe listing on the TSX and consolidating our units to trade in the seven-dollar range has substantially broadened our potential investor base. We believe the success of this capital raise confirms that.”

The Ottawa and Halifax acquisitions will be funded with approximately $30.8 million in cash from the offering and approximately $67 million in new mortgage financing at a weighted average interest rate of 3.4 per cent.

PROREIT intends to use $13 million from the offering to repay debt.

Impact of acquisitions on PROREIT’s portfolio

Upon completion of the acquisitions, PROREIT will own 91 income-producing commercial properties representing approximately 4.4 million square feet of gross leasable area and $625 million of gross book value, with a weighted average lease term of 5.7 years.

The acquisitions will also increase PROREIT’s industrial and mixed-use exposure by another 636,726 square feet to more than 2.8 million square feet. That represents 64 per cent of its total gross leasable area and 46 per cent of its total base rent.

While PROREIT has no other immediate acquisition plans, Beckerleg said opportunities are always being reviewed.

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Moncton Airport Receives $8.34-Million From Ottawa To Boost Cargo Export Capacity

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MONCTON – The federal government is investing $8.34-million and creating 140 temporary construction jobs to expand the cargo operational infrastructure at the Greater Moncton Roméo LeBlanc International Airport.

The airport’s cargo business has been quickly expanding in recent years, mostly because of the demand for live and fresh seafood products in China. In 2018, it posted a record for the shipment of cargo abroad, with 16 flights carrying over 1,000 tonnes of live seafood to Asia and Europe. It was the first time the airport saw a steady flow of local products being exported to international markets on large, dedicated cargo flights.

Airport CEO Bernard LeBlanc says the rapid growth makes new investments necessary. Passenger and cargo planes share runway space, he says, which restricted flights in and out of the airport for both types of traffic. The new investments will “eliminate bottlenecks” for cargo and passenger travel.

“We’ll be able handle cargo traffic 24 hours a day, seven days a week,” said LeBlanc in a phone interview with Huddle. “It opens up possibilities for more growth.”

The federally funded project includes the following upgrades:

  • Expanding Apron 8 to accommodate more cargo flights without affecting passenger aircraft traffic.
  • Expanding the de-icing pad to allow for de-icing of cargo aircraft and passenger aircraft.
  • A new de-icing fluid management system to comply with environmental regulations.
  • Overhauling and reconstructing the road connecting the airport apron to cold storage and cargo staging facilities.

The new investments will help grow the live and fresh seafood exports with more regularly scheduled flights to places like China. But LeBlanc says it will also open up opportunities for other products too. For example, the airport recently received a call from Malley Industries about shipping an ambulance to Israel.

Accommodating these kinds of requests is harder when the airport has mostly chartered flights that have to work around passenger travel services, he says.

“Once you get more regularly scheduled cargo flight services, it makes it easier to ship other products as well,” said Leblanc.

LeBlanc says work could begin next spring and be completed by October of the next year.

The federal government is making these types of investments in airports that are seeing increased economic activity from cargo exports. Last November, the Halifax Stanfield International Airport received $23-million in government funding to expand its cargo facilities to reduce congestion, among other things. As in Moncton, the investment was driven by strong demand for fresh seafood in China and Europe.

Ginette Petitpas Taylor, Minister of Health and Member of Parliament for Moncton-Riverview-Dieppe, sayS the airport drives export growth by opening up new opportunities for local businesses.

“The Greater Moncton Roméo LeBlanc International Airport is a key factor in the growth of the Moncton economy,” said Petitpas Taylor in a release. “The improvements will create more options for cargo aircraft and help businesses get more products to market.”

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