Zip has been zapped.
Air Canada has shut down its discount airline, leading to concerns that customers in Western Canadian will be left out in the cold.
“Who do we talk to when we get ticked off?” asks Rick Erickson, an aviation analyst based in Calgary. “I think that (lack of Western Canadian representation) is an oversight on Air Canada’s part – and one that should be addressed.”
Erickson is calling for Canada’s national airline to appoint a senior executive in charge of Western Canada in wake of Air Canada’s move to shut down Zip last week.
“We should have a say,” he says, adding Western Canada comprises too large of a share of the market – 35 to 40 per cent – for Air Canada to ignore.
Zip, created two years ago, had served as a competitor to Calgary-based WestJet in the West. Air Canada is moving Zip’s flights, fares and employees under its main company brand.
Unlike its former subsidiary Tango, a discount airline that it shut down but retained as a brand on low-fare programs, Air Canada will no longer apply the Zip label to its ticket products.
Erickson says the move to integrate Zip into the main airline shows Air Canada has done everything it wants to do before emerging from bankruptcy protection at the end of September.
“Low domestic fares are here to stay,” he notes, adding Air Canada’s restructuring effort appears to have been successful.
Zip’s death comes as no surprise, as Air Canada announced two months ago that it would integrate Zip into its mainstream operations. Zip was only created, he adds, to aid the restructuring effort.
“They wanted to send a clear message to labour that they would do whatever it took to reduce labour costs.”
Air Canada is shifting Zip president Bill Bredt to the post of senior vice-president and chief operating officer for its Air Canada Jazz regional carrier. Most of Zip’s 400 employees have been transferred to positions within Air Canada.
– with files from CP
