Abrupt end to codeshare leaves unanswered questions in Nunavut

“The Government of Nunavut will continue to advocate for the best possible airline service for Nunavummiut, and we will monitor this situation when it takes effect,” the GN said in reaction to news that the First Air-Canadian North codeshare agreement will end in May 2017. (FILE PHOTO)

Nunavut’s air passengers and leaders alike say it’s too soon to know what the end of First Air and Canadian North’s codeshare agreement will mean for air travel across the territory in 2017.

But one thing is certain—First Air’s sudden news last week that it would pull out of the agreement in May 2017 has left Nunavummiut with a lot of questions.

Customers “have told us that they strongly prefer to fly First Air on its own,” First Air’s president and CEO, Brock Friesen offered as an explanation Nov. 17.

That statement doesn’t do much to assure Nunavut travellers, many of whom say they’ve seen a decline in air service to and from their communities since the codeshare arrangements went into place in mid-2015.

“It’s another shocker,” said Tununiq MLA Joe Enook, a vocal critic of codeshare in the Legislative Assembly.

“Just a year and a half ago, it was the greatest thing since sliced bread. Where does it leave us now?”

Under the codeshare agreement, Canadian North stopped servicing Enook’s hometown and riding of Pond Inlet, while First Air stepped in to operate daily flights to and from the Baffin community.

But the MLA said those flights are often overbooked, leaving leisure, business and medical travellers stranded.

“We have to wait days and days for flights,” Enook said. “What happens now? There are so many questions. I like to think there’s a positive somewhere, but I just can’t see it.”

The two airlines’ partnership dates back to early 2014, when their owners, Makivik Corp. and Norterra, jointly announced the two airlines would merge to “improve the sustainability of these critical Inuit birthright enterprises” and “create better air services and new economic development opportunities across the North.”

But seven months later, the airlines said they’d been unable to reach an agreement, ending merger talks.

But the discussion didn’t end there; in 2015, Canadian North and First Air agreed to launch a codeshare agreement, which saw the two major northern airlines team up on north-south connections to, from, and within the Kitikmeot and Baffin regions of Nunavut.

A separate codeshare agreement between First Air and Calm Air was put in place to service the Kivalliq region.

With Nunavut’s air market now divided by air region, air passengers across the territory wonder what that will mean for air service moving forward and if individual airlines are prepared to re-distribute their services across the territory.

The GN said it’s too early to speculate—the territory’s leadership will have its eye on air travel come May 2017 to see how things pan out.

“It may or may not revert back to how the airlines navigated the market prior to the codeshare,” said Jim Stevens, assistant deputy minister of Economic Development and Transportation, in a Nov. 21 email to Nunatsiaq News.

“The Government of Nunavut will continue to advocate for the best possible airline service for Nunavummiut, and we will monitor this situation when it takes effect.”

The GN has publicly complained about the impact the codeshare agreement has had on travel in the territory, particularly for medical patients with appointments scheduled in southern cities.

The GN was among a handful of groups to file official complaints with the Competition Bureau, a federal agency in place to ensure Canadian businesses and customers benefit from a competitive marketplace.

Case in point: Months later, a new Iqaluit-based airline launched and then pulled the plug before its first flight took off last May.

Go Sarvaq’s decision to fold came less than two weeks after an aggressive seat sale campaign by Canadian North and First Air, offering one-way tickets to Ottawa for $399 —roughly $1,000 cheaper than standard fares.

Go Sarvaq also filed a complaint with the Bureau, which is now investigating allegations of predatory pricing and anti-competitive conduct on the part of First Air and Canadian North.

The Competition Bureau filed its applications Oct. 20 with the Federal Court of Canada office in Ottawa and the court granted the bureau’s request Oct. 26, which could require the airlines to produce records and other information.

The termination of the codeshare won’t likely impact its investigation, the agency said.

“The Bureau is aware that First Air has announced that it has given notice to Canadian North to terminate their codeshare agreement as of May 16, 2017,” an agency spokesman wrote in a Nov. 18 email to Nunatsiaq News.

“The Bureau’s investigations into the codeshare agreement and into allegations that the two airlines engaged in predatory pricing are ongoing.”