It was shocking enough when Gary Collins suddenly announced last December that he was resigning as B.C. finance minister to go into private business. What was perhaps even more of a stunner was that Collins was leaving politics to lead an unheralded airline in an industry marred by bankruptcies and blood-red balance sheets.

Yet, Collins wasn't just following his business instincts in recognizing what he terms a niche market in the Canadian airline industry dominated by Air Canada and WestJet. He was also following his heart.

Collins cut his teeth in business as a flight instructor and has had a lifelong passion for flying.

Now, Collins is in the cockpit at Harmony Airways, where the rookie chief executive officer is fervently pitching old-fashioned luxury service that includes hot meals and complimentary wine, eschewing the current trend of no-frills flights featuring pretzel lunches.

Larry MacDougal, Business Edge
Gary Collins and Harmony Airways are promoting luxury travel while competitors are still focused on no-frills flights.

Harmony Airways is owned by Vancouver tycoon David Ho, who founded the airline in 2002 after being stranded at an airport in Maui with his daughter for 18 hours. Ho is heir to Hong Kong Tobacco, Asia's largest tobacco company, and his Canadian business interests include an auto dealership, a golf course and a development company.

The company specializes in flights to holiday destinations such as Hawaii and Las Vegas, and serves six Canadian cities - Toronto, Vancouver, Calgary, Abbotsford, Kelowna and Victoria - with its fleet of four Boeing 757-200 aircraft. But Collins' vision for his tiny airline extends far beyond its current scope, with a focus on establishing service to China and other Asian destinations.

His leap from politics to the floundering airline industry is akin to jumping from the frying pan into the fire. That may well be the case, but Collins leaves the distinct impression he can stand the heat.

1. Growing up in Moose Jaw, Sask., what was your boyhood dream?

"Probably to get out of town. It was a good place to grow up, but I didn't want to stay there forever. I always thought being a pilot would be fun and I also went through a period where I wanted to be an architect. So now I get to dabble in aviation and build things, which is fun too."

2. Your first career was in flight training. Do you still fly?

"I don't as much as I used to. When I first got elected (as an MLA in 1991), I tried to keep my currency (for his pilot's licence), but I found it very frustrating and a very expensive hobby. But I had an opportunity to go back to the college (University College of the Fraser Valley in Abbotsford where he was once employed) as a keynote speaker. They put me in the 747 simulator. I hadn't shot an approach in about 14 years and I did a wonderful (simulated) landing about 200 yards southwest of the airport in Vancouver. Which is great if you're flying a Beaver (with floats) but not a 747."

3. What led you into politics in 1991?

"Well, I would sit there and throw my shoe at the TV every day when the news was on. I decided I should either shut up or do something about it. So I got involved, got elected (as a Liberal MLA in the Fort Langley-Aldergrove riding) and spent 10 years in Opposition and four years in government. Ten years in Opposition is nine and a half years too long."

4. What made you throw your shoe at the TV?

"Oh, just frustration and seeing the way things were going. I saw British Columbia, a great province, really going downhill towards the latter part of the eighties and into the nineties. It was just bad leadership. I thought it'd be better to try to get involved and try to help rather than complain about it."

5. How do you reflect on your career in politics?

"It was a great experience, a real privilege and an honour to serve the public. I'm very proud of the work that we did during the four years I was in government. We took a province that had a pretty massive deficit, a $4.4-billion forecast deficit, and turned it around so that this year there was a $2.6-billion surplus. We went from the slowest-growing economy in the country to the fastest-growing economy. It was immensely rewarding to make changes, but it was very frustrating as well. It's hard to turn a four-million-person province around and it's a big task taking a $36-billion budget and turning it around."

6. Why did you resign as B.C. finance minister last December?

"Because I'd been doing it for 14 years and I have a very young family. I had sort of completed what I think I went there to do. I looked at all the indicators, all the work we'd done, and sort of said, 'Well, where do I go for the next four years?' I thought it was a probably an opportune time to get out of elected office and let someone else have a go at it. I never viewed it as a lifetime career. I viewed it as something I would do for a while, as long as I could contribute, and then move on."

7. How much of a factor in that career move was money?

"If people get into politics thinking they're going to make a lot of money and that's the motivator, you're there for the wrong reasons. You're there to serve. I knew what the pay was when I got in and didn't worry too much about that. It also reaches a point where I've got a family to support and provide for, and there are other opportunities out there, I thought."

8. Why did you choose to get into the challenging airline industry?

"There's no question about the fact that it's an extremely challenging industry but there are also lots of opportunities if you can do it right and provide a great level of service, and that's what we're trying to do here. It's an industry that's turned into a bit of a commodity lately, so if you can provide something different, something that people like and good-quality service, then I know people will come to that, and they are."

9. What's it like to work for David Ho (sole owner and former CEO of Harmony Airways)?

"He's great. He's very interested in the company and the success of the company. He's very community minded. He's a good guy to work with in that he finds good people and lets them do their jobs."

10. Is your goal of tapping into the Chinese market going to be the key to whether or not Harmony Airways succeeds?

"Well, we're going to succeed. There's no question about that. China will certainly be a component of that, but it's not all that's there though. We're going to build our network across North America from the major centres and that's going to be an exciting progression as well. We're doing extremely well in the Hawaii market, a market that we've really made our imprint on and will continue.

"But China and Asia are a real opportunity for us and we have a unique set of skills within the ownership and management of this company to succeed in Asia. Lots of North American companies spend decades trying to figure out how to do business in Asia and China, and we're there already (establishing partnerships). It's really a fairly diverse market, but it's a rapidly increasing market as well. What it requires is a level of service that will win those customers over and bring loyalty. Air Canada has been there for a while, having taken over from Canadian (Airlines), but there's a big market and we're going to go and make sure we have our piece. The Chinese economy is growing at incredible rates, there's lots of trade opportunities and I think we're just seeing the beginning of it. There's going to be big tourism opportunities as North Americans get more interested in China and its history. I think the business travel is going to be significant as well."

11. Are you looking at expanding Harmony's footprint in other major centres such as Toronto?

"The North American market is important to us, both as a feed-through to China but also for our (airline) partners who fly to North America from Asia and other destinations. We're already in Toronto with non-stop routes to Vancouver and I expect we'll be ramping that up at some point. We have a business-class product as well between Toronto and Vancouver that is head and shoulders above anything else you'll find on that route. We just launched that in June and it's really becoming quite popular. The more people that fly, the more the word is getting out."

12. At a time when the airline industry is going to no-frills flights, why are you promoting luxury travel?

"We're not going to be an 80-plane airline any time soon. That's not our goal. Our goal is to be a niche carrier, build customer loyalty and keep those customers coming back again and again. We're not trying to mass-market to all 34 million Canadians. We're really focused on people who like our type of service, like our type of product, like our schedule and times, love our in-flight service and the people who work at this company - and we're building that loyalty one customer at a time. The rewards have been significant. Now that we've launched our business-class service, the reviews are great. I think the airline industry has turned itself into a commodity over the last number of years where everyone's the same and we just compete on price. I think there is a market there for people who want a little more than that. They want the experience to be a bit of a pleasurable adventure as opposed to an ordeal and it doesn't take much for an airline, if you really try, to provide that. It starts with the people who work for you. We've got fabulous people on board our aircraft and it goes beyond that to the service you provide on the ground, on the phones and on the Internet."

13. Are you planning to become more of a competitor to Air Canada and WestJet or will you remain concentrated on niche markets?

"We're not looking to go head-to-head with anybody. Air Canada does what it does and WestJet does what it does, and WestJet does what it does very well if you're going on a very short hop from place to place. They (WestJet) have provided a very low-cost service that people seem to like but that's not what we're shooting for. Clearly, we're doing a little more than that. Our service levels are higher, a little classier, a little more focused on the quality of the service. Certainly, the benefits are there - the hot meals, the free wine, the entertainment that you're not going to find on a WestJet or that other guy (Air Canada). You come on our airline and you're getting more than a bag of pretzels or some cookies. You're getting a full meal, three courses, your choice of entrees, free wine, free movies and we don't charge for headsets. Our best advertising is word-of-mouth. That's how most people hear about us."

14. What's your view of the general quality of service on most airlines these days?

"The tipping point, I think, was a little while back when Northwest (Airlines) announced that they were going to start charging a dollar for their pretzels. Most people don't even want the pretzels anyways. I just thought, 'Come on, let's get serious now.' Air travel has become such an ordeal, particularly since 9/11 (terrorist attacks). It's sort of this ordeal you've got to go through before you can get where you want to be. It didn't always used to be that way. You used to look forward to it. The stewardesses were pleasant, the aircraft were comfortable, you got a decent meal on board and it was fun. I really want people to get on our flights and say, 'Gee, I feel like I'm welcome and people that are working here seem to be happy that I'm here.' But there are some airlines in this country where you get on board and you just want to apologize and say, 'I'm sorry for being here, but I'll just sit in the corner here and don't mind me.' Our flight attendants are probably the best thing that we've got going for us. They love their jobs, they love what they do, they love the company and they really enjoy the interaction with the passengers. You can feel that when you get on board. We get 500 applicants for 20 spots for a flight crew and we get people coming from other airlines who want to work for us."

15. Have you read ACE Aviation Holdings Inc. (parent company of Air Canada) CEO Robert Milton's book?

"Of course. You've got to know your competition. I haven't written one yet, so he doesn't know my airline. It was interesting reading his view on the industry and on the company. I think they've got big challenges. They've come out of it (bankruptcy protection) with a plan that seems to make sense, but there are still huge cultural problems that he's got to fix first. And that's the toughest thing to do at any organization. Unfortunately, I think in some ways they've still got the culture of a Crown corporation and, having dealt with a number of those myself (in politics), I know how hard that can be to change.

"As for WestJet, I think they've done extremely well over the last number of years but I think they've sort of reached the edge of the known territory and they're starting to bump up against some fierce competition south of the border and finding Air Canada a much tougher competitor in Eastern Canada. And now they're sort of wondering where they go next. I think they're going to have challenges to maintain the 35-per-cent growth rates they've had in the past but I wish them luck. I think competition's good and keeps everybody sharp."

16. Do you anticipate Harmony Airways being taken public at some point?

"Maybe at some point, but David's doing this on his own right now and he certainly has the financial wherewithal to invest the capital that's required to grow the company. At some point he may decide to do that or he may just decide to bring in other partners whom he knows personally and has other business relationships with around the world. That will be his call. In a couple of years, there might be an opportunity and it might be what David wants to do. But for now we're just focused on growing our market share and building our niche and being very successful."

17. How do you see a continued escalation of fuel prices affecting the airline industry and the ability for airlines to survive?

"It certainly makes it a lot tougher. What happens, obviously then is the prices need to rise. Then the question is how much the marketplace is willing to pay to get from point A to point B. If the fuel prices stay high, you'll see a lot of the older aircraft retired. You'll see new aircraft at a premium. But the price in air travel has gone down, in real terms, dramatically in the last decade or so. Although fuel prices are high and it certainly crimps things, it's still a very efficient way to travel. As technology improves, it will become even more efficient. The new generation of Boeing and Airbus aircraft that are going to come off the line in the next four, five years or so are 40 per cent more fuel efficient. The last gallon of gasoline that gets burned will be burned in an airplane."

18. How would you describe your leadership style?

"I try to empower people. I try and bring people together with good skills and make sure everybody has a clear understanding of the organization's direction, whether it's the public sector or the private sector. Then you set the strategic plan and empower people to go take risks, make decisions and succeed. You encourage them, correct them when things don't succeed and reward them when they do. I think it creates a real positive environment where people are empowered and they can take risks and they can do things that are different. I think people like that. If you get the right people who enjoy working in that environment, they can do amazing things."

19. What would it take for you to be lured back into politics?

"People have asked me if I'd ever go back and the answer is, 'Yeah, I would go back.' I'm not planning on going back. It's not something that I'm waiting for to happen. If the right issues came along and I felt I could contribute and could add value to improving things or solving a problem, then you know, I might consider it. But it's certainly not something I have written down somewhere in an agenda pad. I'm doing what I'm doing now, I'm very interested in it, I have lots of challenges to keep me busy for the next number of years and we'll see what happens."

20. Do you have a current long-term contract?

"Well, it's like anything these days. As long as things go well, you've got a contract. I'm certainly happy doing it. There's lots of challenges but lots of opportunities. And I'll keep working at it until I either run out of opportunities or run out of challenges."

THE COMPANY: HARMONY AIRWAYS INC.

* Profile: Harmony Airways, founded in 2002 by David Ho, is a Vancouver-based full-service international airline with a fleet of four Boeing 757-200 aircraft. Harmony's sister company, Companion Holidays, offers accommodation, ground transportation, and vacation and tour packages.

* Owner: David Ho.

* Destinations: Harmony's current international destinations are Honolulu, Maui and Las Vegas. The airline serves six Canadian cities - Vancouver, Toronto, Calgary, Abbotsford, Kelowna and Victoria. It also has direct service between Vancouver and Toronto.

* Claim to fame: Harmonyone business class features cuisine created by chef Bruno Marti, president of the Canadian Culinary Foundation, as well as premium B.C. wines.

* Website: www.harmonyairways.com

* Head Office: 250-3600 Lysander Lane, Richmond, V7B 1C3.

* Phone: 604-270-2088.

IN PROFILE: GARY COLLINS.

* Title: President/CEO, Harmony Airways.

* Born/raised/age: Moose Jaw, Sask./42.

* Home: Vancouver.

* Education: Simon Fraser University (Vancouver), economics, political science (no degree).

* Family: Wife Wendy Cox, two children.

* Career: Prior to being appointed CEO of Harmony Airways last December, Collins was British Columbia's minister of finance. During a 13-year career in public service, Collins also served as government house leader and official Opposition house leader. He was first elected MLA in the riding of Fort Langley-Aldergrove in 1991. He has also worked as a flight instructor at University College of the Fraser Valley where he taught in the aviation diploma program.

* Favourite travel destination: Paris (where he proposed to his wife).

(Gyle Konotopetz can be reached at gyle@businessedge.ca)