Is Canadian North losing millions? CEO won’t say
Makivvik Corp. president Pita Aatami says, during speech, airline was taking major losses
A Canadian North plane approaches Iqaluit in this file photo. Canadian North and the federal government have agreed to new conditions related to the airline’s 2019 merger with First Air. (File photo by Jeff Pelletier)
Canadian North CEO Michael Rodyniuk won’t say if his airline is running at a loss.
Nunatsiaq News reached out to Rodyniuk about the health of his company after Makivvik Corp. president Pita Aatami implied the airline is losing millions of dollars during a keynote speech last month at the Northern Lights conference and trade show in Ottawa.
Aatami cited a number of factors including COVID-19 travel restrictions, increased fuel prices, and federal restrictions related to the 2019 merger of Canadian North and First Air.
“People think that, ‘Oh, they’re the only airline, they’re making millions.’ Instead of making millions, we’re losing millions,” Aatami said in his Feb. 10 keynote speech.
“We’re trying to get support from the Government of Canada to see if they can revisit the conditions that we had to meet, and we’re still working on that.”
Canadian North is jointly owned by Makivvik and the Inuvialuit Development Corp.
When then-Transport Minister Marc Garneau announced the federal approval of the Canadian North and First Air merger in June 2019, it came with a list of terms and conditions.
That list included no price increases for both passenger travel and cargo delivery beyond those related to operating costs and no reductions to the weekly schedule options on all routes of the airlines’ combined network for seven years, among other restrictions.
Rodyniuk – who was present at Aatami’s speech – would not directly answer whether the airline is running at a profit or at a loss. However, he said the merger has challenged the airline’s operation costs.
He echoed Aatami’s comments about increased costs since 2019, noting that four years ago, the airline and the federal Transportation Department could not have predicted a pandemic, a war in Ukraine and record-high inflation.
“We’re not in the wildly profitable stage of the company, for certain,” he said.
“But you know, at the same time, the good news about our company is we’re diverse enough that we have other streams of revenue that can cover off the other parts of our business that are not as efficient.”
He said his company continues to talk to Transport Canada to “eke out a profit” within its restricted operations and said the government is always open to working with the company.
Michael Rodyniuk is the president and CEO of Canadian North. (File photo courtesy of Canadian North)
Rodyniuk also disputed any assertion that Canadian North has zero competition in the North, despite some round trips costing thousands of dollars.
He named a list of other airlines that operate in the North, and said that individual flight operating costs are around $10,000 per hour.
“If I fill that airplane with 100 people, and I fill it three or four times a day, I’m going to make a profit. If I fly it once a day and I only fill it with, say 20 people, then those 20 seats have to cover the cost of that airplane,” he said.
“The fares in the North are relatively higher than what you’ll see in the south, but that’s because there’s so much thinner market in the North, and you can get a higher fare, but you won’t be able to fill your airplane and that’s going to cause losses for companies.”
Transport Canada has not yet responded to questions about how much federal financial support Canadian North has received, or about what sort of discussions there might be between the airline and Transport Minister Omar Alghabra on the 2019 merger restrictions.
On Jan. 30, Alghabra tweeted that he met with Aatami and Rodyniuk to discuss Canadian North’s operations.
Rodyniuk, who has been the CEO for just under a year, said his company remains strong.
“We’ve been around for 77 years now,” he said.
“It’s going to be, I believe, at least another 77 years of very good, prosperous operations.”
Hmm funny how Makivvik don’t talk about Air Inuit and how the buy those old jets from Canadian then pump alot of money into them to keep them flyable only to turn around and use those same jets to fly mainly skidoos, atv and boats into Makivvik’s core area……..
You really think auditors would let that slide? Lol two different companies and nice imaginary theory you got there.
Air Inuit doesn’t not buy Canadian’s planes, they came from overseas. You think Makivvik would allow an airline of which they’re majority owners of go under. People don’t realize that the cost of running the airline, all of its operations and infrastructure. Competitors like nolinor or chrono may at times offer cheaper rates to the end customer, but they don’t hire and train Inuit or locals, and definitely don’t put a penny into investments in the north weather in Nunavik, Nunavut or Inuvialuit region.
The GN and Federal Government paid Canadian North millions of dollars to run flights throughout the pandemic. They ran fewer flights. They laid off staff. Did the executives get their annual bonuses? I bet they won’t tell you that either.
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The owners of Canadian North have long been trying to convince the federal government that they are a public service to the places they serve. As such, they should be publically funded. Forget the territorial government gives Canadian North a boat load of money as part of medical and duty travel rates. If you ask me, if the airlines are essentially “roads”, the government should own them as they do in the provinces.
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Canadian North’s rates are easily 30% higher on my route now than pre pandemic. My employment northern allowance has not increased 30%. The result is I’ll travel less. I’ll maybe even move. Canadian North can never answer a basic question: I can fly to South Africa from any hub Canadian North is based for less than it costs for a return trip to the north. Why is that? Either poor management or a big siphoning of money by the owners (Inuit companies).
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If they keep pushing this maybe the federal government will mandate WJ and AC serve the north again as part of their licensing to foster competition. Whitehorse and Yellowknife see super cheap flights out compared to this capital.
So YK and YFB are the hard done by communities. I feel for you who can’t keep their vta up to date
There are thousands of us in the communities with no VTA at all
Critics who couldn’t operate a business if they had to.
This may come as a surprise to you, but GN employees don’t get VTAs either. VTAs are part of the problem as they shield people from the cost of airfare.
In the long run the only way this improves is when the market segment comprised of people freely spending their own money to buy tickets starts to dwarf the segment comprised of people flying with someone else picking up the tab. (medical, duty travel, VTAs) Only then will Canadian North realize that lobbying government is of no use and the only way to get what they want is to run the business better.
My recollection Paul is that you have no business experience but please enlighten us.
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The capital of the territory features the majority of the population and for many it is the only way to the actual south so it makes sense to compare capitals to capitals.
May want to reset your recollection button old anonymous one. Your “facts” are not factual. And typically, you ignore the rest of Nunavut (with the majority of the Nunavut population) with disdain, just as Iqaluit complained about pre-Nunavut.
here’s a suggestion, stop with the crazy high dynamic pricing! while it is understandable for the airlines down south to have dynamic pricing due to competition, routing, etc. There is no reason for CN to charge thousands of dollars to fly within Nunavut or outside of Nunavut. There is rarely if ever any seat sale for Nunavut. The last seat sale was for Calgary to Yellowknife, V-day sale, are NU not worth of any sale? If the price isn’t so exorbitant, there might be a start of some sort of tourism. And if CN wants to fill 100 people on a plane and flying 2-3 times a day, set a price, and it shouldn’t matter if I book 6 months in advance or 6 days in advance. Having paid $2200 one way from Iqaluit to Atlantic Canada one way, CN should not be losing millions as a big chunk of that belongs to Iqaluit to Ottawa routing!
But look at the Atlantic Canada salaries within GN (due to seniority), highest in the work force, taking most of the senior positions. most protected of each other by other senior GNers…You’re in good position; why are you even posting negatively? your retirement looks good; cheap housing (inherited on most occasions and paid-off), cheap land prices and good food prices, good all around…ppl don’t know it when they have it good…
Canada is a free country, I can choose to work anywhere I am qualified to do the job. My family is in Atlantic Canada, am I not entitled to visit them? It probably cost $2200 one way as well from Iqaluit to Grise Fiord for someone to visit their family there. Are they not entitled to also visit them as well? Canadian North is creating huge barriers for economic, tourism and family reunification within Nunavut and outside of Nunavut. How many posts do you see on Facebook where Inuit are seeking donation for flight costs for funeral, seeing their family members whom they have not seen in a while? If CN has a fair pricing policy, I might be more sympathetic of their pleas of “losing millions”.
You seem to have a really specific prejudice against people from the Maritimes.
Why?
Westjet cost per liter of Aviation gas over 2021 .80 per liter.
Nunavut’s selling price for this year for aviation gas. 1.55 per liter
I wonder why my airfare seems so expensive?
I find it interesting that with federal conditions about flights not being cut and prices not going up, We have noticed the level of services going down which includes flights being cut and prices going up, especially with trying to make changes to our flights such as changing dates of our travel, it is pretty much buying another ticket for any changes you want to make, its cheaper to get a refund if you can and buying another ticket instead of making changes.
Trying to call their 1-800 number is a joke, on there for an hour or two to be told they can’t do anything.
I think you need to look at your managers and the people you hire to work at Canadian north and make improvements there, obviously there is issues within this airline.
or is this a case of the prince claiming he is a pauper and having nothing to eat for Christmas Dinner while carrying a turkey and ham under each arm?
I would be careful in reading too much into their claim, they are a private company and no obligation to release their financial statements so without those i would take their words with a grain of salt.
How about if they want public funding they become publicaly traded and therefore need to show their books and hold their board (which includes Makivik leaders) accountable. I don’t believe a word of it either. If the business ran at a loss they would have folded it long ago, but they keep on going. I would buy into Canadian North if I could, and the governments should consider it also. No free handouts. Ownership stakes or nothing. I am now being gouged on my wages, my chicken, my rent but I have always been gouged by this “Inuit” company and so have Nunavummuit.
Northern Store is a public traded company and that does not mean they provided better service or value for us. We still can’t figure out how and where the nutrition north subsidy goes.
At the end of the day what should have been a condition of the merger was public disclosure of operating costs and revenues. If you want to be a monopoly they should be audited by the auditor general office, and disclosures made to the public on reasonable expenses. (executive bonuses are not reasonable expenses)
its easy to say food program they used it on something else you see Northern Store brought Aircraft for they stores
This from a company who wants to charge 70,000 dollars for 20 school children to take a round trip flight to Ottawa for a field trip. Ridiculous.
Your source?
Round trip Iqaluit to Ottawa on Canadian ort (per Expedia) $1600
“But you know, at the same time, the good news about our company is we’re diverse enough that we have other streams of revenue that can cover off the other parts of our business that are not as efficient.”
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Translation
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The airline loses money on every flight because of the high rental fees it pays to our airplane owning company.
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Our airplane owning company loses money on every airplane rental because of the high costs it pays to our airplane maintenance company and the high rates at which it borrowed money from our airplane finance company to buy the planes that it rents to our airplane operating company.
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We have such a complex corporate ownership structure that we can lose money in any business, any time it is to our advantage to do so, while making the profits seem to disappear.
Why is it that NunaVimiut/northern Quebec people only pay minimum amount to travel community to community with air inuit or anywhere else for that matter. Maybe start charging what you are charging us Nunavumiut to get your millions you so desperately want.
Riddle me this, why have we seen full canadian north flights on the combi, or mechanicals which lead to a jet liner that cant take cargo… then millions of cargo stay in mtl
Cause the combi is mechanical??
But yet we are complaining flights arent filling up??
Maybe it’s time for communities to charter Summit or Calm Air lol
Great, now watch the insane prices go higher..a family member got bumped yesterday, while my in law saw a plane half full. Games are being played while the regular person is losing. That’s what we get for living in a government economy, and not a consumer driven one
You have a complete monopoly and a captive audience held hostage on different islands in the arctic.
And in spite of that you can’t eek out a profit.
I have no sympathy.
Fail.
And on top of all that this airline has received millions from the GN and the federal government.
It goes to show it’s the airline and it’s management that are the problem here.
Canadian North can’t be losing money! They’re the only airlines in Nunavut. Hopefully the minister of transportation is not easily persuadable and makes his own decisions on matters like this and won’t further support this company as it milks the pockets of Nunavummiut. Spread ur wings to other communities Arctic Fresh!
Anyone who is from kugluktuk can fly to Paris France for the same price as a return ticket to yellowknife with only one ride….go figure
That other airline offered “More affordable Rates” from Iqaluit south, then as soon as CDN North lowered their prices to beat them you all went back to CDN North? That’s why you have no competition and lower airfares.
cut down your salary.
138million dollars in subsidy’s during Covid, and still losing money, here we go again bailout coming from the Feds, and we need more, common theme in Nunavut,
Buy the airline or portions of it to fund it not bail it out. It is the only way forward and worked when Canada gave Air Canada cash during the pandemic: they paid it back and bought their shares back. Giving to Canadian North is a black hole of champagne liquors and glass offices for the owners.
People please. Pita Aatami wants his 600 k bonus. (Again).
I m sure George wants his too !!!!
Canadian North received $138 million in government support during much of the COVID-19 pandemic, according to a spokesperson for Transport Minister Omar Alghabra. $23 million from Government of Nunavut.
Poor leadership is always expensive to support.
During my three decades in the airline industry I have seldom seen leadership as weak as that at Canadian North.
My time working as an Aircraft Maintenance Engineer for Canadian North was a humiliating, dehumanizing, and absolutely soul destroying experience.
At Canadian North it is a firm requirement that the employees maintaining the aircraft must be trained, examined, and certified competent as licensed aircraft maintenance engineers. The pilots flying the aircraft undergo rigorous training and evaluation, and must be federally credentialed as pilots. Even the flight attendants must be trained, determined to be competent, and fully government certified before they can serve the airline.
However, Canadian North has never demanded that the airline’s managers be trained, evaluated, and certified competent as managers. This is specifically why far too many Canadian North managers are incapable of even beginning to understand their basic duties to their employees, nor are they able to function in anything approaching a competent manner. Sadly, many managers at Canadian North do not even possess the fundamental personal awareness that would allow them to realize exactly how much they do not know about airline operations.
It should be no surprise whatsoever that aeronautical science programs and organizational behavior analysts around the globe have repeatedly seized upon Canadian North as an exquisite and quite clear example of the Dunning-Kruger effect, where psychological evaluation reveals a cognitive bias, whereby managers with limited knowledge or lacking competence in a given intellectual or social domain greatly overestimate their own knowledge or competence in that domain.
It is quite heart-breaking that when any group of Canadian North employees gather over a coffee every one of them is able to offer a troubling and tragic example of the latest dumb and dangerous management decision which they have been subject to.
What level of incompetence is involved in operating ATR aircraft off of gravel runways while fitted with a propeller configuration which is wholly unsuited for gravel runway operations?
Why should highly trained aviation professionals such as mechanics, pilots, and flight attendants be expected to work for unqualified and incapable amateurs who are vainly attempting to pretend to be managers?
Would you want to eat at a restaurant where the kitchen staff did not know how to cook? Would you ride in a taxi if you knew the driver did not have a driver’s license? Why would anyone work for a company where the “managers” have never bothered to learn how to manage a company?
The inherent management weaknesses at Canadian North results in systemic disorganization and inefficiencies which are manifest in the customer experience, such as that which prompted one reader to post on April 9, 2022 “I personally have four pieces about 300 lbs and I have been told it will take a month from Iqauit to Igoolik. Parts needed by companies can take up to a month”.
Many companies working across the Canadian arctic have had their shipping and travel departments adopt an “anybody but Canadian North” policy for essential employees, supplies and spare parts which must arrive on time. The increasing number of other airlines that are being chartered to complete flights that Canadian North is incapable of providing itself is indicative of a lack of focus at Canadian North in regards to meeting customer expectations.
It is not only residents of the arctic who have expressed displeasure and dismay with Canadian North.
Incompetent, negligent, and unaccountable management at Canadian North has also resulted in a wide range of Canadian North employees posting on numerous employer rating websites regarding their unacceptable experiences working for this dysfunctional airline.
On Indeed’s employment review website, Canadian North employees have stated “This company is very behind and not up to industry standards”, “Management is uneducated in their positions “, “ During my time at Canadian North I did not meet anyone in management who seemed to be the least bit interested in, or capable of, supporting front-line employees” , ”Communication, planning and adoption of appropriate industry standards are entirely foreign concepts to this company”, “There is not much good planning, and often no stuff what to do, I never know why I am yelled at”.
On Glass Door’s employment review website Canadian North employees have stated, “Horrible management not a clue what they are doing”, “There is no professional development”, “Old equipment disgusting working environment (dirty, falling apart, extremely outdated)”, “Useless management treats employees like garbage”, “Pay is terrible”, “Constant revolving door of employees”, “Staff treated poorly and communication was inadequate.” “Morale is low.”, “Very little trust in employees, no empowerment for new ideas or innovation”, “Many Managers and Directors are legacy hires with limited experience in the market outside of this one airline”, “Company does not address issues employees have or correct problems effectively”, “Managers are mainly powerless to effect change.”
When customer expectations cannot be met because the essential employees required to complete even the most basic tasks have quit yet again, flights are cancelled, cargo is delayed and everyone suffers.
I myself have been personally contacted by a number of Canadian North employees who after much structured, rigorous, and methodical evaluation have concluded that the only means of redress they have, as the victims of the threats and harassment by their managers at Canadian North is to initiate a class action law suit.
The Transportation Safety Board’s investigation into First Air’s last fatal accident (Aviation Investigation Report A11H0002) identified inadequate training, poor communication, and inept management as contributing factors. These are the exact same issues that Canadian North employees continue to express their concerns about right up to the present day.
Was anything learned from the crash of Flight 6560.
The only people who seem to be incapable of realizing that there are serious problems at Canadian North are Canadian North’s management.
Canadian North is an airline which has a lot of potential, but that potential is being irresponsibly squandered, because the highly trained professional team that serves in the hangars, aircraft, and airport terminals are consistently being betrayed and obstructed by negligent, incompetent, and unprofessional managers who weigh them down, and continually set them up to fail.
The people of the Arctic deserve better. Canadian North’s employees deserve better.
Before any further tax dollars are squandered supporting an airline suffering from its own self-inflicted wounds, appropriate modern standards must be adopted, and appropriate service standard commitments must be made. Tax payer’s dollars must only be provided after a structured, rigorous, and methodical analysis has been undertaken, in the interest of due diligence, to ensure that the airline is actually worthy of the taxpayer’s trust and support.
Canadian North has no shortage of naive office dwellers who are expert as continually dispensing lame excuses. It is time to start only accepting productive solutions. It is time to only accept intelligent decisions and professional approaches to daily operations.
There is no future for an airline that remains firmly stuck in the past.
Canadian North’s financial and operational difficulties are deeply rooted throughout the fundamentally dysfunctional organization.
HAHHA what a joke, he can’t say anything because he knows they aren’t loosing money. They are the monopoly and charge what they want, they cancel flights everyday and don’t care about their customers because they can, they rule the North and they aren’t loosing money. It’s just a ploy to try and get more money from the Feds.
$3000 for a round trip from Iqaluit to Edmonton. This airline is not hurting. They are taking advantage of northerners to pad the pockets of their millionaire executives. This airline is a joke, and the merger should have been rejected.