Board Member, Argo Consulting Inc.

Board Member, Argo Consulting Inc.

An international “operations improvement” consulting firm based in the U.S. which specializes in transportation (notably air and rail), oil and gas, industrial manufacturing, natural resources, and chemical processing industries. Argo also serves numerous Private Equity firms in their pre-acquisition and due diligence processes.

Embrace Change – or Perish: Privatization of Air Canada

Montreal, 3 April 2018


Change affects every walk of life … every business … every profession.
Looking back at history … we can observe that “change” is relentless … but the pace is not linear.
The invention of “agriculture” gave mankind more time to be creative; … more time to think …
There have been periods of great change … for example the Renaissance … the industrial revolution … and now the technological age!


In terms of its impact on our civilization … the invention of the “internet” is perhaps … comparable to the invention of the “printing press” … in 1440.
It had a major impact … on the dissemination of knowledge …
Created new products … book production flourished … and newspapers were born!
Likewise … the internet … has given rise to tremendous innovations … including … of course … “social media”.
“Social media” deals with the ideas economy. It deals with intellectual property … and collects rent rather then selling goods!


Sometimes … change occurs too fast … questioning our ability to adapt … or to feel comfortable with its consequences.


Change affects every walk of life … every business … every profession.
We have been … and continue to be … in an era of constant innovation …
Some current examples

  • The internet of things
  • The expansion of robotics
  • Drones for package delivery
  • Self-driving … autonomous ground transportation
  • The printing of parts … or 3D printing … or “additive printing”!
  • Not to mention … artificial intelligence.


Innovation can destroy existing companies … and it can create new ones … (creative destruction).
Walmart … and Apple … did not exist 50 years ago.

  • Today they are listed in the top 10 of Fortune Magazine.

The pressure is on to continue to innovate … or perish.

  • Apple says … that it needs to refresh or re-invent its consumer products … every four years … or it will lose leadership. …
  • Think of Blackberry! … At one time an industry leader … today barely surviving.


We are witnessing the start of exciting new ventures … for example …
The commercialization of space …

  • The beginning of “space tourism”
  • The commercial launching of smaller satellites … at a much lower price than today
  • Major developments in air transportation … using electricity as the prime … if not the only … source of energy.
  • Regional electric airplanes … 50 passengers maximum? … a possibility within 10 years? … Maybe hybrids to start with

We are well down the road towards achieving

  • Driverless/autonomous transportation …
  • And the use of drones … first for carrying freight … and for urban transportation. … Experiments in the Emirates … and Singapore.

In short … new technologies have … and will continue to affect the way that we work … and what we do.


The various factors of change can have an impact on the products available …
Change can challenge the relevance of certain firms and institutions … and threaten their very existence.
Such conditions … can be technological … such as the impact of IT … or market changes … or a change in products … such as the availability of electricity … which made other forms of lighting … obsolete
Consumers’ expectations and needs change … for example

  • People are increasingly eating at restaurants.


For any firm … whose existence is threatened … for one reason … or another …
It is essential to define what changes are required … to ensure that the firm responds to evolving needs … or environment … and continues to fulfill an appropriate role … to be in business … and to be relevant.


We are now going to discuss a “real” case.
The following example deals with the transformation undertaken by a company

  • To ensure that it met evolving market requirements
  • And societal expectations.

More particularly … I will discuss briefly the nature of that change …
How it was managed … to ensure that the corporation was transformed …
And achieved the relevance required … to justify its continued survival.
Specifically … as we look ahead … we will review the changes that were required to ensure the survival of Air Canada … and how they were accomplished.
As it would be for all such cases … it is important to understand

  • The strengths … and weaknesses … of the company
  • The forces that are at play … threatening its survival
  • The transformation which is required … to ensure that it will thrive in the next timeframe …
  • And the kinds of programs required to achieve that objective.

If one is going to dramatically change the purpose … or the direction … the nature of the firm … or anything else … it is also important

  • To know where you come from! … and what you are starting from … and what was the original culture.


The predecessor of Air Canada … Trans Canada Airlines … T.C.A. … was created in 1937 by C.D. Howe … nicknamed “Minister of Everything”
(P.M. MacKenzie King and Louis St. Laurent)

  • It was a time of nation building
  • Mandate: … To help unite the country: Atlantic to Pacific … coast to coast … similar to railroad.
  • Shortened the time to cross the country … at the time 5-6 days.

It needed to pioneer radio navigation across the country.
Offer Canadians the best service … at the most affordable cost … i.e. provide them service with a break-even mandate.
Public service mentality
The advice of a Transport Minister was
“If you are profitable … lower the price …
But stay away from deficit … and we will stay away from your business.”


Renamed Air Canada in the 60’s … to reflect an international role.

  • Linking Canada to Europe and the U.S.A. … as well as the Caribbean … for example
    • U.K. … France … Germany
    • New York … Chicago … etc.


Crown Corporation – Constraints
Sometimes … the Government mandated service to small cities … e.g. Sault Sainte Marie and Corner Brooks (by Minister of Transport)
Or promoting Canadian goods … e.g. wine
A Crown Corporation was required to appear every year at various Parliamentary Committees … for instance
Employment equity … languages … Transport Committee
Anecdote for Parliamentary Committee … concerning the Minister of Agriculture … attending Transport Committee … Eugene Whelan (Niagra)

  • Requiring more Canadian wines during the hearing
  • Adjourned to Parliamentary Restaurant
  • No Canadian wines available at the restaurant
  • Reconvenes afternoon sessions … no more questions on wines!


Backtracking for a moment … we should recall …
That in the 1970’s … major changes were taking place.
Technology was changing productivity (jetliners and jet engines

  • Boeing 747 … 350 passengers
  • An increase of more than 4-fold

Increasing consumer pressure in North America.
Then In 1979 … the U.S. government decided to introduce the Domestic Airline Deregulation Act … under the Carter Administration.


We saw the emergence of low costs

  • New York Air … Peoples’ Express (new airlines)

Some traditional airlines could not cope! … Consolidation

  • Eastern Airlines … Continental

Other low costs

  • Laker’s Sky Train … Wardair … originally a charter … then a regular airline.

Interestingly … “Southwest Airlines” is the only one of the original “low costs” surviving today … most new low costs did not survive.
In Canada … we witnessed the emergence of Affinity Charters …
A form of low cost operation …

  • Shortly after … the requirement for Affinity was dropped.

Given the proximity of the U.S. … Canada felt the need for progressive deregulation.
1984 “Freedom to Move” – The Canadian Deregulation Act

  • Any airline can fly anywhere in Canada
  • Freedom of frequency and pricing

The relevance of Air Canada was challenged.
For Air Canada … it was change … or perish!
We decided to develop a privatization plan.


Privatization Plan:

  • New mandate
  • Creating a new vision
  • Defining change elements
  • Managing the transformation

Convincing ourselves of the necessity.

  • Freedom to move … meant increased competition
  • As a crown corporation … Air Canada was unable to move quickly (government controlled) … constraints

Alternative was potential demise
Believe that you can change and that it is feasible.
Developing a new vision … shared by all
We needed to convince everyone of the need for

  • A national … commercial … international airline
  • Profitable
  • Customer-oriented

There was a lot of resistance to change!
We needed to obtain support of:

  • Government
  • Employees
  • Communities
  • Opinion makers


We needed to define a change program
Major elements

  • Improved productivity … efficiency
  • Routes network … optimum fleet
  • Change culture … customer orientation
  • Community expectations
  • Financial community … achieve profitability

Setting goals for each change element … for example … improved profitability

  • Renegotiate contracts – with no government involvement
  • Outsource when appropriate
  • Create a cost/effective network
  • Develop a new fleet plan


Reviewing the network and the current fleet

  • Review service required at small stations.
    • Requirement for different fleet
    • Correct infrastructure/overhead excessive

Solution was to have 12 small stations … served by different aircraft … and less heavy infrastructure.

  • Create regional airlines e.g. Air Ontario, Air B.C. etc,
  • Operate small aircraft – DH-8 100/200
  • More frequent services

But communities losing jet service (DC-9) in return for several flights a day by DH-8 turbo props … had to be convinced.
Air Canada needed to avoid a majority interest … for labor reasons.


To accomplish … extensive communications had to be carried out with …

  • Communities … loss of jet vs turboprop
  • Local and Federal representatives
  • Unions and employees … loss of civil status
  • Local consumers … service vs profit?


Improving the productivity of the employees

  • Convincing the pilots to support change … without work interruption
  • Improving the productivity of
    • In-flight/cabin groups (5-week work interruption)
    • Mechanics group (IAM) (3-week interruption)
    • Counter/reservations people (2-week interruption)

All of which allowed changes in work rules and in some cases … outsourcing.
[Anecdote about walking in to a union meeting in Toronto … discussing strike action.]



Developing a new … and more ambitious … international route plan.

  • Untapped potential – 5th Freedom from U.K.
  • Fully exploiting existing rights to the U.S. … and to overseas destinations (Asia).


Communications program.
Carried out an extensive communications program … to reach each individual employee.

  • Joining coffee breaks at various locations in a relaxed “townhall” format
    • Answering questions
    • Talking about the future
    • Enlisting their support
    • Proposing employee partial ownership

Carrying out extensive communication program with the provincial … municipal … various opinion makers … across the country.

  • Explaining the service proposed
  • The need for a major international airline
  • The social and economic advantages


Set up an overall cultural change program

  • Involving each employee
  • Emphasizing team building
  • Customer-oriented
  • Pride of ownership


Improve the debt/equity ratio by … (find hidden values)

  • Monetizing hidden values in the current fleet
    • Sale and lease back of the DC-9 fleet
    • Sale of the Boeing 737 fleet to FedEx … obtain contract to convert to freighter
    • Sell part of investment in Guinness Peat leasing

which generated more than $150 million.
[Anecdote: Bank of Nova Scotia deciding to sell its headquarters for $400 million Canadian [they are not in the brick business].


  • Develop a new fleet plan
    • To acquire/order long range aircraft to support the international expansion program … B767-200/300
    • To replace the domestic fleet A-320/A-321 options
    • To provide new aircraft for the regional operation – 50 DH-8 100 & 200


By 1987-1988 … we achieved

  • Improved productivity
  • Improved profitability – adequate R.O.I.
  • Better debt/equity ratio
  • New regional services (airline and fleet)
  • New proposed Air Canada Act
  • Government-free contracts for suppliers


Proposed partial privatization to the Federal Government … as a first step …

  • Enabled Air Canada to sell $300 million of new equity for 49% of the airline
  • Shares sold for $8.00 each

The Government was able to sell its participation in the airline in 1989 for 500 million CAD

  • 51% of its shares … at $12 CAD a share


Air Canada was then free to operate as a private enterprise with some constraints:

  • Headquarters to remain in Montreal
  • Continue to have technical centres in Montreal, Winnipeg and Toronto
  • Foreign ownership of shares limited at 25%

The financial community was comfortable with Air Canada.

  • Efficient regional services created (JAZZ)
  • International expansion strategy
  • Optimising aircraft fleet
  • Positive change in product – more market-oriented
  • Improved debt/equity ratio
  • Supported by reasonable/acceptable profit plan


To summarize … and recap …

  • Freedom to Move … issued in 1984
  • Program started … Transform airlines to make it “privatizable” e.g. debt/equity ratio …
  • Increase profitability

Partial privatization (1987-1988)

  • Dilution of government ownership to 51% … $300 million raised. … First shares sold at 8 CAD a share
  • New “Air Canada” Act
  • Arms length agreement
  • Limit on foreign ownership … less than 25%

Total privatization … 1988-1989

  • Sale of government 51% share ownership … raised $500 million. … Shares had increased to 12 CAD a share!
  • New fleet acquired
  • Executive management re-appointed for 2 years


Need to make a sober assessment of my/our situation

  • Carrying out a “swot” analysis
  • Strengths … weaknesses … opportunities … threats … challenges

Develop strategy
What are the possible scenarios for tomorrow?

  • Seeing “around the corner” … How is the industry evolving?

Review where we came from

  • Evolution of current culture and expectations

Understand that the keys for success yesterday … are often not the keys to success tomorrow.
Set up and manage a change implementation program with

  • Program managers
  • Milestones and periodic reviews

Follow up … and celebrate … success
In a changing world … embrace change – and prosper!

Thanks … and good luck!

Guest Lecturer, McGill University School of Business

Lecture to McGill University School of Management
Pierre J Jeanniot, O.C., C.Q., FRAeS
Montreal, 1 March 2018


Commercial aviation started in the Western countries …. in the 1920’s and 1930’s.  … It served some elitist passenger markets … and also some cargo markets and postal services … which enabled goods and information to be transported fairly quickly … compared to the more conventional ground systems that existed at that time.

The volumes were very small … and during World War Two the demand for commercial air transport virtually disappeared … and was dominated completely by the needs of aviation military applications.

At the end of the Second World War …interest in commercial aviation transportation revived fairly quickly … and some of the technical developments which had been made for war purposes were rapidly adapted to civil aviation … mainly passenger travel.

As commercial aviation was likely to grow rapidly … the various governments decided it was necessary to develop rules to regulate … how flights would take place between countries.

This was accomplished by the Chicago Convention in December 1944 … which created ICAO … the International Civil Aviation Organization … an organization of the United Nations … which established a set of rules … or Freedom Rights.

It was followed by the creation of IATA … the International Air Transport Association …  in April 1945 to provide a framework … and rules on how to operate/manage airlines.

From the start …  air transportation was viewed as an exchange of commercial opportunities … and the regulations developed to facilitate travel between countries consisted of a number of rights … such as air rights to fly to a country … rights to pick up passengers from that country … rights to fly over a country … rights to link a country beyond the two countries in question … and so on.

The exchange of commercial operating rights between countries requesting access to markets … required equal opportunities on each side.

The exchange of access to markets … was covered by an international treaty called … an air bilateral agreement. …

This covered an exchange of rights between each country …and regulated how … flights of passengers and cargo … should take place between those countries.

Essentially … this was an international treaty … to permit the exploitation of commercial opportunities in each county.

These agreements originally dealt with a rather elitist market.

The costs of flying were very high … and only the upper class of the population could afford them.

In addition to high quality leisure traffic … there was a need for travel for business … and political reasons.

There was a need to fly between different countries … to ensure that there were adequate … and rapid connections between those countries.

With the exception of two airlines in the U.S. … namely Pan American and TWA … the airlines of every other country were government … owned … and operated according to the rights that had been negotiated by their respective countries.

Most countries wanted an airline for “political reasons” … to establish control over their airspace … and to acquire an international presence.  Hence the term … “National Flag Carrier”.
Two things essentially governed commercial aviation:

  • The exchange of commercial rights to exploit the markets between two countries;
  • And second … also very important …, was the need for a safe operation to the extent possible … which required increased regulation … and the enforcement of safe practices by each of the operating airlines.

In the years following the Second World War … the number of flights … the size of the airplane … the exchange of rights between countries … were growing fairly rapidly.

Every nation regulated very closely the development of aviation within its respective country and … of course … the development of civil aviation between each country … was regulated by international air bilateral agreements … under the auspices of ICAO.

IATA was to provide rules … and processes … for the actual operation and management … e.g. tariff coordination … standardized procedures for ticketing … cargo … etc.

The concept … or model of national flag carrier … still exists today …   although even those airlines … which are still owned totally … or partially … by a government … have had to become more business-like … and to be guided by commercial considerations.

Any operator within its own country … was under the jurisdiction of its own Air Regulation Bureau … and its international flights would be governed by the Air Bilateral Treaties … its government would have negotiated.

For instance … Air Canada was created to provide fast transportation from one end of the country to the other. This initial role was in many ways … similar to the creation … decades previously … of the trans continental railways.

The original name of “Trans-Canada Airlines” reflected that role … but it was changed to Air Canada when it developed an international network … originally to Britain … then France … Germany and Switzerland.

The mandate was largely to provide fast service at break-even cost.

One Minister of Transport was fond of saying “Stay away from the tax payers purse … and we will stay away from your business.”

But that was not always so!

For instance … when I was head of the company … while it was still a Crown Corporation …  I was prevented from starting a Frequent Flyer program for the best part of a year … by the government … which originally had considered that this was not part of its mandate!

As a crown corporation … Air Canada was required to appear annually …  in front of various committees … where any parliamentary elected individual could appear … and ask questions.

The following anecdote is fairly typical of the kind of cross-examination which could routinely take place.

“The quantity of Canadian wine on board of Air Canada airplanes … being pushed by the Minister representing a southern Ontario riding. – (typical anecdote)


As one can see … sometimes … narrow political motives can become a factor … without any commercial considerations.

A decreasing number of national carriers still largely operate with non-commercial constraints … but generally will still require financial subsidies.

Or … have been allowed to disappear … e.g. Sabena.


Later in the 1960’s … a number of technical developments increased … the productivity of operations.

Most important were the jet engine … and the jet-liner.

It was now possible to transport twice the number of passengers … at twice the speed … on any transatlantic flight.

These new airplanes increased the productivity by 4:1.

Some entrepreneurs understood … that if one could increase the seating density … and achieve a higher degree of seat occupancy … say around 90% … one could operate a flight profitably … while setting a price at less than 50% of what a regular flight was charging.

In some ways … that was the first type of “low cost model”.

They were called … Affinity charters”.

Theoretically … one had to belong to a group … which occupied the entire flight … and required that almost every seat on that flight had been sold.

Affinity charters thus made air transportation available … to less affluent people.

These charters could benefit from the higher level of seating occupation … and therefore this made it possible to operate and sell tickets at lower prices.

The requirement to belong to a group … was subsequently removed.

An airline model that emerged … at that time and featured lower prices … was Laker Airways … called “Sky Train”.

Laker was able to create a new product … which did not require most of the overheads…  of the established airlines.

The airline did not have a reservations system – it was simply walk on … walk off.

Laker Airways operated routinely between major markets … such as London/New York.

The model was dependent on little overhead … and high density seating and occupation.

A rather similar affinity charter format existed in Canada … and met the needs of the low-cost market.

That was the charter airline operated by Wardair.

Wardair operated a series of programme of seasonal frequencies.

It depended on high occupancy … and offered fares which were much cheaper … than those offered by the regular airlines.

Those successful operations encouraged the growth of consumerism …  leading to a demand … for the wide availability of lower cost air transportation.


The Air Regulation Act was passed by the U.S.A. in 1978 to remove Federal control over routes … pricing … frequencies etc. and to allow total “domestic” competition.

All commercial constraints were to be removed … but naturally the U.S.A. maintained all regulations on safety.

Shortly after … the U.S. abolished the CAB (the Civil Authority Board) … which was a rigid …  bureaucratic mechanism … and had become redundant.

This created a climate of total … unrestricted … commercial competition within the U.S. territory.

The U.S.A. domestic air transport deregulation was sudden … and virtually instantaneous.

From that moment on … the U.S. airlines were allowed to fly anywhere they wished within the U.S. … with any flight frequency … any seating arrangements … for any price.

The only remaining regulations concerned safety … and associated air worthiness regulation.

Proving they met the safety requirements … some dozen and a half new airlines emerged fairly quickly.

These were the first U.S. low-cost airlines.

Invariably … these low costs were based on the same model … essentially

  • Very low fixed costs/and overheads
  • Single airplane type fleet
  • Higher density seating configuration
  • Single class
  • High aircraft daily utilization/fast turnaround
  • Focussing their operation on relatively large markets … e.g. Chicago-New York.

Pricing was designed … to significantly undercut existing airlines … on the targeted routes …

And hopefully attract new flyers … In other words … expand the market.

Employees at counters … and flight attendants … would be young … enthusiastic … and relatively low paid.

Typical of those airlines were “Peoples’ Express … the “New York Air” … the “Southwest Airlines”.

A number of traditional U.S. airlines were unable to cope … with the new degree of competition … which was being introduced.

A number of airlines disappeared … or consolidated … such as Eastern and Continental.

Of those new low-cost airlines … some 10 years later … only Southwest Airlines survived. …  The other low-costs were unable to achieve a profitable operation … in a sustainable fashion.

A good question would be …

Why were all the new low-cost airlines unable to survive … short of Southwest?

Apart from managerial know-how … the major difference lay in their choice of markets … and their aircraft scheduling strategies.

The survivor … Southwest … avoided head-on competition … and specialized in smaller markets where there was less competition.

They also decided to serve point-to-point markets … where customers were being inconvenienced … by the hub strategy being followed by the legacy/larger airlines.

Clearly … many passengers may prefer a direct flight … to a connection … if the timing is suitable.

It is also fair to say that Southwest was able to sustain enthusiasm … within its young group of flight attendants and airport employees.

The vast majority of new “low-costs” … chose to go head-to-head with established airlines on major markets.

They were unable to sustain their operation … to gain a sufficient presence … and achieve a minimum profit.

The difficult financial situation … faced by most businesses in the 1980’s … also contributed to their failures.

Given the proximity of the U.S.A. … Canada felt the need …  for progressive deregulation … of the commercial Canadian aviation market.

The Canadian government introduced …  a Domestic Commercial Aviation Deregulation Act … which progressively provided total domestic freedom.

The 1984 “Freedom to Move” Act permitted … progressively …

  • Any airline to fly anywhere in Canada
  • Total freedom on frequency and pricing

But … of course … the Act maintained all safety-related regulations.

Air Canada … was government-controlled and was faced with the choice of becoming a private enterprise … or eventually disappearing …. since it would not be able to compete on the open market … as a number of important decisions needed government approval.

The new Act forced Air Canada to privatise … encouraged new low costs to emerge … and caused some of the existing airlines to merge … particularly PWA acquiring CPAir … then Wardair.

A new low-cost was successfully launched … “WestJet” … which wisely followed the same successful model … as Southwest Airlines … e.g. one airplane type … high seat density and one class.

WestJet originally …  avoided head to head competition … and also recruited some young and enthusiastic employees.

A number of regional airlines merged … or disappeared … and some of the more traditional charters … survived … generally as a component or holiday/destination package … example Air Transat.

The U.S. Domestic Deregulation Act … had allowed full freedom to the airlines to alter their schedules.

To increase their efficiency in serving the market … the surviving traditional airlines decided to build around a major hub … sometimes called “Fortress Hubs”.

For example … Atlanta became the major hub of Delta …. Dallas for American Airlines … and Chicago for United Airlines.

This enabled each major airline to concentrate traffic … increase the efficiency of airplane utilization … as well as ground services.

The hub strategy provided for more frequent services to the “spoke” cities … but required passengers to transit through the hubs.

This “fortress hub” strategy …  enabled the major airlines to dominate the market of their major hubs.

The passengers had a joke …

“With this system … when I die and I wish to go to heaven … I will have to go through Atlanta … Dallas … or Chicago.”

Hubs were also developed for air freight.

The strategy of the domestic cargo hub in Memphis … enabled FedEx to offer an efficient package delivery service … throughout North America … daily.

On the international side … KLM … was probably the first airline to build an international hub in Schiphol (Amsterdam).

Exploiting its strategic geographic position in Europe … and the proximity of relatively underserved markets … KLM was quite successful at growing its traffic … well beyond its own base.

KLM became a 6th Freedom specialist … handling traffic flows from other countries … to other countries through Amsterdam.

With a relatively small “home market” … Singapore … an island state … exploited the same strategy … driving traffic flows from Southeast Asia to Europe … through Changi Airport.


During the 1990’s … the European Community decided to deregulate progressively the air travel market.

The creation of a European Common Air Market enabled:

“Any current regular European airline to have unlimited freedom to operate within the Common Market … any location … frequency … price …etc.

The emergence of new carriers … essentially low-costs … with the ability to operate anywhere within the Common Market.”

The model of the new European low-costs … was similar …  to the original group of low-cost airlines in the U.S. … with the following differences:

The new European low-costs:

  • Avoided head to head competition
  • Operated from secondary/low cost airports
  • Attempted to avoid unions
  • Emphasises ancillary revenues
  • Located their corporate H.Q. … in countries with the lowest corporate tax (e.g. Ireland).

These features enabled a number of new low-costs to grow rapidly … e.g. Ryanair … EasyJet etc.

As expected … the European deregulation forced regular … or legacy … airlines to attempt to adjust … to the increased competition.

Some were allowed to fail … e.g. Sabena … and many consolidated.

Eventually … three major groups emerged … one led by British Airways … the International Airline Group … (IAG) … which included BA … Iberia … and Vueling … a low-cost airline.

The second group was led by Lufthansa … which acquired Swiss … (formerly Swissair) … Austrian Airlines … Brussels Airline … (replaced Sabena) … and low-cost airlines Eurowings … and German Wings.

The third group … of Air France/KLM … operating Transavia … originally created by KLM … Air France is also starting another low-cost … Joon.

The acquisition … or development … of a low-cost airline by the three major European groups … is a recognition of the significant success of the new European low-cost … and an attempt to participate in this expanding market.

The strategy followed by these three major groups … is to concentrate their traditional operations … on the long-haul markets … and to expect their low -cost subsidiaries … to regain a reasonable market presence … on the short to medium routes in Europe.

This assumes … that the long-haul market … will not be seriously threatened … by new low-cost airlines attempting to achieve a profitable operation on the long-haul market.

Long haul/low cost airlines … first began operating in Asia.

“Long-haul” market is defined here … as any operation of more than 4,500 kms.

One of the contenders … in the long-haul low-cost market is Air Asia X … which was originally targeting long-haul markets from Kuala Lumpur in Malaysia … to Sydney Australia … and from Kuala Lumpur … to London England.

The key features of the Air Asia X Business Plan are:

  • Single aircraft type operation … (wide-body) A-330 …

B-767-300 etc.

  • Daily aircraft hours utilization of 16 hours/day +
  • High density seating … and assigned seating

[to help boarding]

  • Discretionary income generated by all frills … (food … drinks … entertainment … baggage … certain seats etc.)
  • Connections offered … for a fee … but no hub and spoke.
  • The L.C.C. terminal at Kuala Lumpur Airport … and Gatwick in London.

Air Asia X has set as an objective … to achieve operating costs of 50% less than the competition … which is a very challenging objective.

The other major low-cost … long-haul contender … is Norwegian International … which is hoping to use more narrow-body aircraft on Atlantic routes … such as Boeing 737 Max … to connect Ireland and Scotland … with secondary airports in the U.S.

But adopting the European model to a long-haul operation has been challenging … and Norwegian’s long-haul operation is running lean. … [difficult to replace aircraft if mechanical] … (poor on-time performance)

While it was able to register its aircraft in Ireland … to benefit from lower corporate tax … Norwegian was not able to circumvent labour law by hiring Thai crew.

Ryanair had been able to sign up its flying personnel … to an individual contract … in Singapore  (now threatened).

In spite of all these efforts … in both Asia and Europe … long-haul low-cost operation has yet to demonstrate clearly … that this model … ensures sustained financial viability.

The growth of low-cost carriers … particularly Ryanair and EasyJet … has been nothing short of spectacular.

Today … Ryanair is the largest European airline … in terms of passengers carried annually.

Perhaps feeling that the low-cost market is becoming saturated … some low-costs have now decided … to attract a portion of the business traveller … by offering a “modest” business product and thus enjoying better yields.

This has given rise to a “hybrid” model for some low-costs.

Their “Business Plus” product includes:

  • Travel flexibility (ability to change flights)
  • Reserved seat priority
  • Booking priority
  • Baggage allowance, and
  • Dedicated Business check-in at airports

Typical of those are WestJet and Southwest in North America … and EasyJet as well as Ryanair on some European routes.

Some of those low-costs are also offering connection services … which had not been available previously.


In the extreme case of the Ultra-low-costs … every possible feature … such as choice of seats … baggage … any food or entertainment etc. … is the subject of additional price.

A number of ultra low-cost airlines … in the U.S.A. … are leading the way.

Typical of those are “Spirit Airlines” and “Frontier”.

The traditional Ryanair is still the true low-cost … and “no frills” champion … but for these ultra low-cost airlines … ancillary revenues account for an increasing part of their profits.

Internet … and fare search engines … have strongly increased the transparency of pricing … and the face value of tickets … has become the main driver … for customer purchasing behaviour.

Promoting the idea that customers will only be charged … for the services they chose.

For the airlines … ancillary fees represent a high revenue potential … with a large profit margin.

At the centre of the strategy … of those ultra low-cost airlines … lies the need to be a low fare leader in the market.

They aim at operating at fares … at least 25% lower than charged by the competition.

These airlines are planning average daily utilization … of more than 12 hours/day

… and an average load factor of over 85% or more.

New flights to small airports … is also a component of their strategy.

Finally … ancillary revenues have the advantage of being less seasonal … for example … fares move up and down … but baggage fees stay the same.

Three new ultra low-cost airlines are presently being planned in Canada.

“SWOOP” … the new WestJet airline’s … ultra low-cost … will begin domestic flights …. In June … with flights between Abbotsford in B.C. … and Hamilton and Halifax.

While fares will be at rock-bottom levels … SWOOP passengers … will similarly pay for everything beyond the seat itself.

In some cases … ancillary fees may exceed the cost of the fare.

Jetlines … and FlyToo … are still hoping to start operating in the next timeframe … hopefully in 2018.

Required financing is said to be mostly in place … and their plan is said to follow the same successful ultra low-cost model.

We wish them the best.


There are several important topics … which given time constraints … we have not been able to explore … such as:

  • The nature and impact of airline alliances
  • The “Open Sky” air bilateral … originally promoted by the U.S.A. … to guide aviation rights bilateral negotiations … which increased international competition.
  • and the controversy surrounding the definition of “fairness” in the implementation … of Open Sky Air Bilaterals between Gulf Airlines … and the European and U.S. legacy airlines.

Those subjects … and others … have an impact on the evolution of airline markets … and would require further discussion.


Prof. John Saba, McGill University (right) and Mr. Hector Ramirez, Honduras Representative to ICAO

Guest Lecturer, McGill University

Prof. John Saba, McGill University (right) and Mr. Hector Ramirez, Honduras Representative to ICAO

Prof. John Saba, McGill University (right) and Mr. Hector Ramirez, Honduras Representative to ICAO

Powerpoint Presentation: Privatization of Air Canada


c-series plane fuselage, photo by Yan Gouger (Own work) [CC BY-SA 3.0 (]

Interview, BNN Business News

Outlook for the Bombardier C-Series

Read more

c-series tail, photo by Alexandre Gouger (Own work) [CC BY-SA 3.0 (]

Interview, BNN Business News

Bombardier/Boeing dispute.  Announcement by Delta Airlines to purchase the C-Series Read more

Pierre Jeanniot receiving the Officier de la Légion d'honneur de France

Named Officer of the French Légion d’Honneur

Pierre Jeanniot receiving the insignia of the Officier de la Légion d'honneur de France from Mme. Kareen Rispal, Ambassador of France to Canada.

Pierre Jeanniot was named Officer of the French Légion d’Honneur by the President of the Republic of France on 14th of April 2017 in recognition of his remarkable professional career and exceptional leadership of the International Air Transport Association. The insignia was awarded by the Ambassador of France to Canada, Mme. Kareen Rispal, at a ceremony held at the Consulate of France in Montreal on 13 November 2017.





Cher M. Jeanniot,

Monsieur le Ministre,

Distingués invités,

Chers amis,

Nous sommes réunis ce soir pour célébrer la juste reconnaissance par la France du parcours éminent de M. Pierre Jeanniot.

M. Jeanniot

Né à Montpellier en 1933, vous êtes représentatif de ce que peuvent réaliser de meilleur nos compatriotes de l’étranger. Vous illustrez en effet l’excellence française déployée à l’international. Formé sur le terrain, vous avez gravi tous les échelons dans le secteur de l’aviation civile, au sein d’Air Canada, pour finalement accéder aux fonctions de président directeur-général d’Air Canada, mandat que vous avez exercé de 1984 à 1990.

A la tête d’Air Canada, vous avez piloté le projet de privatisation de l’organisation, qui était alors une société d’État. La restructuration de l’entreprise, que vous avez conduite avec succès, vous a valu d’être reconduit pour un deuxième mandat de président directeur-général.

Vos mérites ont pleinement justifié une première reconnaissance de notre pays, puisque vous avez été fait Chevalier de la Légion d’honneur en 1991, un an après votre cessation de fonctions en qualité de PDG d’Air Canada.

En 1993, vous avez été le premier Français à diriger l’Association du transport aérien international (IATA), créée en 1945 et dont le siège est à Montréal. Premier et seul citoyen français jusqu’à ce jour élu à ce poste, on vous a surnommé “l’ambassadeur de l’aviation civile” et sous votre gouvernance l’IATA a été reconnue dans le monde entier comme le “porte-parole du secteur de l’aviation civile” pour avoir su faire valoir les intérêts du milieu international des transporteurs aériens.

Cher Pierre Jeanniot,

Durant votre mandat, qui s’est achevé en 2002, votre remarquable implication pour aider le secteur de l’aviation civile à traverser les périodes de crises et à en réduire les répercussions sur l’aviation doit être saluée. Vos talents ont été particulièrement manifestes lors des événements tragiques du 11 septembre 2001. Vous vous êtes ainsi attaché à atténuer les impacts de cette crise majeure en promouvant la coordination des échanges d’information entre les transporteurs aériens et les instances gouvernementales mais aussi l’harmonisation des réponses du secteur de l’aviation civile avec celles des autorités gouvernementales du Canada, des États-Unis, de l’Union européenne et de l’OACI, l’objectif ultime étant de rétablir le bon fonctionnement du réseau mondial de l’aviation et d’apporter des réponses rapides, efficaces et sécuritaires.

En votre qualité de directeur général de l’IATA, vous vous êtes fixé des objectifs ambitieux :
– renforcer, grâce à la mise en place d’un organisme externe d’évaluation, la sécurité du secteur de l’aviation civile internationale afin de réduire de 50 % le taux d’accidents sur dix ans, cible qui a été atteinte dès 2005
– convaincre par ailleurs le secteur de l’aviation civile de reconnaître ses responsabilités environnementales (normes pour réduire le bruit et les émissions)
– promouvoir une expansion efficace et durable de l’espace aérien et des aéroports.
– enfin, accroître le nombre de membres de l’IATA de 200 à 280 transporteurs aériens (en y intégrant les transporteurs chinois).

M. Jeanniot,

Grâce à votre action, l’influence de l’IATA a été renforcée. Cette institution est également devenue un important fournisseur de produits destinés au secteur de l’aviation, notamment en matière de formation et de perfectionnement des ressources humaines. Votre engagement indéfectible au sein de l’IATA a été salué par tous vos pairs et vous ont valu le titre de « directeur général émérite ».
Vos compétences, unanimement reconnues, vous ont ensuite conduit à occuper le poste de président du conseil de Thales Canada, entre 2003 et 2009.

Pierre Jeanniot

Au titre des nombreux et éminents services rendus au secteur de l’aviation civile internationale en votre qualité de directeur général de l’IATA, organisation aujourd’hui reconnue mondialement et constituant une référence dans le domaine du transport aérien, j’estime pleinement justifié de vous promouvoir au grade d’Officier de la Légion d’honneur. Cette très haute distinction est une juste récompense de votre indéniable contribution à l’aviation civile internationale et au rayonnement de la France.

Monsieur Pierre Jeanniot,

Au nom du Président de la République Française, et en vertu des pouvoirs qui nous sont conférés, nous vous faisons Officier de l’Ordre national de la Légion d’Honneur.








Mme l’Ambassadrice de France au Canada, Mme. la Consule générale de France à Montréal, distinguished guests, membres de la famille, chers amis.

Permettez-moi, en tout premier lieu, de remercier chaleureusement Mme. Rispal, l’Ambassadrice de France pour s’être déplacée à Montréal à l’occasion de cette cérémonie et pour les commentaires élogieux qu’elle a eu la bonté de m’adresser.

Mais je tiens aussi à la remercier pour les efforts de l’Ambassade, qui a contribué à dénouer un certain imbroglio au sujet de ma nomination en tant que Chevalier.

Efforts qui ont permis d’authentifier cette première nomination qui n’avait pas, semble-t-il, été homologuée.  Et je vous en suis totalement reconnaissant.

Je voudrais également très sincèrement remercier la Consule Générale de France à Montréal d’avoir mis « sur les rails »  le processus de promotion.

Processus qui ne semble pas, d’ailleurs, avoir été démarré par ses prédécesseurs, sans doute faute de temps.

Je voudrais également dire à la Consule Générale combien je suis sensible à cette chaleureuse réception organisée chez elle à l’occasion de cette promotion.

Mme. l’Ambassadrice, je reçois en toute humilité cette importante distinction.

Distinction qui revient de bon droits aux nombreux professionnels et spécialistes qui ont contribué aux succès de l’Association Internationale d’Aviation Civile.

I am much honored to have served as the International Air Transport Association`s leader for ten years.

The very significant and successful achievements by the International Air Transport Association during that ten-year period is very much a function of the professionalism, the dedication of the outstanding group of specialists who made those successes possible.

I will be forever grateful for their outstanding contribution.

Durant cette période, le volume du trafic aérien a presque doublé.

Nous avons connu, et nous connaissons toujours, une formidable expansion du trafic Asiatique.

La croissance a été très rapide aux Indes, en Malaisie, en Indonésie, au Vietnam et particulièrement en Chine.

Nous avons connu l’émergence de nouvelles lignes aériennes, et les besoins pressants d’effectifs d’expérience ainsi que de personnel qualifié.

Ces conditions de croissance accélérées nous posaient un important défi, qui a mis considérablement à contribution les ressources de l’IATA.

At the same time, and in spite of those excessive demands on our resources, our great professionals enabled our industry to achieve a 50% reduction in the fatal accident rate over a 10-year period.

Et nous avons réduit le taux d’accidents de 50% en dix ans!

The successes of our team were numerous and impressive, but let me mention only two in the interests of time.

Il y a une vingtaine d’années, les pays Africains ne représentaient moins de 3% du trafic mondial et malheureusement, étaient considérés responsables de quelques 20 à 25% de tous les accidents aériens graves.

Les causes étaient connues, mais elles étaient malheureusement fonction de multiples facteurs.

Il y avait des carences en équipement, en formation, en infrastructure, en compétences, en financement, etc.

Il était difficile de persuader les gouvernements d’agir, de prendre la chose au sérieux.

Il était difficile de les convaincre de conserver les redevances aériennes pour les besoins de l’aviation plutôt que de les verser dans le budget consolidé.

Les progrès étaient très lents.

Par hasard, le deuxième mandat du Président Bill Clinton nous présenta une opportunité.

Le Président Clinton avait décidé d’examiner la possibilité d’augmenter les échanges commerciaux entre les Etats-Unis et le continent Africain.

Il proposait de négocier un nombre de nouvelles liaisons aériennes entre les deux continents afin de stimuler les échanges commerciaux.

Nous avions déjà rencontré Rodney Slater, le nouveau secrétaire du transport du Cabinet Clinton.

Rodney, un Afro-Américain, avait été chargé par Bill Clinton d’agir comme ‘Sherpa’ pour la visite que Bill Clinton se proposait de faire.

Le directeur pour l’Afrique de l’IATA était un Sénégalais diplômé de la Sorbonne du nom de Sassy N’Diaye, grand fumeur de cigares qui était responsable de nos relations à l’IATA avec les divers gouvernements Africains.

Nous avons proposé que notre Directeur pour les Relations Africains accompagne le Secrétaire du Transport pour cette visite préparatoire.

Il a été facile de démontrer, grâce aux études détaillées accomplies par nos services techniques, qu’il était nécessaire d’améliorer, considérablement, la sécurité des liaisons aériennes avant de développer des nouvelles lignes.

Et il était clair qu’il y avait suffisamment de fonds pour les besoins en amélioration si ceux-ci étaient alloués aux aéroports, aux contrôles aériens etc.

De cette intervention est né le programme Américain nommé « Safe Skies Over Africa » qui devint une condition à la visite du Président Clinton.

Cet important « coups de pouce » a grandement aidé nos spécialistes à suggérer et encadrer des mesures visant à améliorer substantiellement la sécurité aérienne en Afrique.

Le deuxième exemple, que je me proposerais de mentionner rapidement, concerne l’implémentation des activités de l’IATA en Chine.

La République Démocratique Chinoise était bien sûr déjà membre de l’Organisation Internationale de l’Aviation Civile, organisme des Nations Unies, mais avait jusqu’alors choisi de ne pas être membre de l’IATA.

Un accident aérien spectaculaire devint un élément déclencheur qui nous procura une opportunité de rencontrer le Ministre Chinois du Transport, et de le convaincre de la nécessité de permettre aux compagnies aériennes Chinoises de se joindre à l’IATA.

Un Boeing 737 d’une ligne aérienne Chinoise  venait de percuter une montagne, résultant en une perte totale.

Les derniers mots prononcés dans le poste de pilotage avant l’accident enregistrés par la boite noire indiquaient clairement des lacunes importantes, élémentaires, dans la formation de leurs pilotes.

Le commandant n’avait pas compris le signal vocal émis par l’avion lui demandant de changer d’altitude.

Sans pleine compréhension des conventions universelles requises, l’expansion internationale rapide espérée par le gouvernement Chinois était voué à l’échec.

Suite à notre discussion, le Ministre du Transport nous a alors proposé de familiariser tous leurs commandants de bord avec les conventions internationales sous peine de perdre leurs fonctions de commandant.

Ce projet fut suivi rapidement par un projet conjoint, «un joint venture », entre la Chine et l’IATA pour traduire en Mandarin la bible, les instructions sur le transport en avion des matières dangereuses.

Et ainsi de suite, et je dois dire qu’une fois le support du Ministre du Transport acquis, l’implémentation des services et normes de l’IATA s’est déroulée rapidement.

Aujourd’hui, les activités de l’IATA en Chine sont plus importantes que dans n’importe quel autre pays.

Durant la période de quelques dix années que j’ai passée à la tête de l’IATA, on m’a souvent infligé le titre d’Ambassadeur de l’Aviation Civile Internationale.

J’ai été mêlé à bien des conflits internationaux, en particulier ceux qui affectaient directement l’aviation commerciale internationale.

Parfois il est question de ‘point de vue’.

Je me souviens d’un dicton Africain qui dit que ‘pour une grenouille au fond d’un puit,  l’univers apparait très petit.

J’ai été témoin de l’importance de la diplomatie dans le règlement des conflits.

Et j’ai pu observer “qu’un Ambassadeur qui s’amuse … c’est plus rassurant … qu’un Ambassadeur qui travail » …

Et, en dépit des nombreux conflits internationaux qui sont présents aujourd’hui, je tiens à offrir à l’Ambassadrice de France au Canada nos meilleurs vœux pour un séjour des plus agréable.




COMMERCIAL AVIATION An incredible journey … an incredible future

Address to the Montreal International Aviation Club >>
by Pierre J Jeanniot, delivered by Jeffrey Shane, General Counsel, IATA

24 November 2016  >> 

It’s always a special pleasure to meet with a group of aviation enthusiasts – people who understand what a remarkable industry this is and what it has contributed to the quality of the world we live in!

Even for enthusiasts, however, it’s easy to forget what an incredible journey it has been over first century of aviation, and so I am going to provide a brief review of the highlights.

Then we will spend a few minutes considering together what we might expect in the future, given the remarkable trajectory this industry has been on, and given the exponential rate at which aerospace technology has advanced.

First, the history. . . .

Two years ago, we celebrated 100 years of the first commercial flight, when a flying boat carrying one passenger flew 21 miles from St. Petersburg, Florida, to Tampa at the breakneck speed of 55 miles an hour. The flight lasted 32 minutes.

From this humble beginning has emerged a global airline industry that last year transported 3.8 billion passengers worldwide.

No one could have imagined, back then, the extraordinary success that would be achieved in civil aviation over the next 100 years, nor the fundamental transformation of life on this planet that it would engender.

But it was by no means a linear progression. There were some important triggering events and some significant accelerators.

It’s an uncomfortable proposition, but there can be no denying it: Wars are great accelerators of technology!

The First World War provided a surge of innovation in aviation. The occasional bomb dropped by hand at the start of the war was nothing compared to the thousands of kilos of bombs carried by the much larger twin-engined airplanes which had joined the battle by 1918.

Engines quadrupled in power. There was a vast increase in the number of trained pilots. By the end of the war, more than 150,000 aircraft had been produced by the major combatants.

But none of the aircraft available at the end of the First World War were designed to carry either freight or passengers.

While potential passengers remained a bit skeptical about the safety of air travel, the great advantage of speed for freight and postal services was recognized almost immediately.

In 1919, Pierre-Georges Latécoère – an aircraft manufacturer in Toulouse – obtained a subsidy from the French government and some surplus military aircraft and started to operate regular mail services between Toulouse and Casablanca and eventually to Dakar.

Its successor, Aéropostale, began regular flights between Buenos Aires to Natal in northern Brazil, and across the Andes to Santiago.

In Canada, the first bush flying took place in 1919 to survey the Quebec wilderness.

Air mail services expanded rapidly in North America, and by 1925 the major U.S. banks had become regular customers.

These early commercial air services laid the foundation for the establishment of Imperial Airways in Britain. The first leg of its service from the UK to Australia was inaugurated in 1927.

Pan American Airways started its first international passenger service between Key West and Havana in 1928.

By 1931, KLM was operating a regular service between Amsterdam and Djakarta.

Air France was born in 1933, a regrouping of four small French airlines.

The pace of development quickened.

The 1930’s brought more powerful engines, metal fuselages instead of wood, retractable landing gear, and variable pitch propellers.

It was also in the 1930’s that the Boeing 247 led the way in revolutionizing air travel. Its two 550-horsepower Pratt & Whitney “wasp radial” engines propelled the airplane 50 mph faster than any other airliner at the time, and it was more economical to operate.

The Douglas DC-3, the airplane you see in the picture, was one of the most popular and versatile aircraft ever produced. General Eisenhower rated it as one of the most significant items of war-winning equipment. Over 17,000 were produced.

The Second World War represented another major aerospace accelerator. It accelerated development of more efficient piston engines such as the Rolls Royce Merlin, and major progress in aerodynamics. It also saw the introduction of large 4-engined bombers, the Flying Fortress and the Lancaster, each capable of carrying up to 10 tons of bombs.

But bigger was not always better! The most powerful engine built up to then was developed by Pratt & Whitney for Boeing’s 4-engined StratoCruiser. Each engine generated 4,300 horsepower and had 28 cylinders. Because they were so complicated, however, reliability became a major problem.

The most important development engendered by World War II, of course, was the introduction of jet engines and their use on fighter aircraft. The first of these, the German Messerschmitt Me262 and Britain’s Gloster Meteor, entered service in 1944.

This era also witnessed important developments in rocketry, notably Germany’s V1 and V2 guided missiles.

Commercial air traffic exploded during the 1950’s, growing from 3 million to 57.7 million passengers by the end of the decade.
The U.S. carriers Pan Am, TWA and Eastern became major players, and dominated the market.

European airlines also experienced a revival.

The 1950’s witnessed the introduction of the Douglas DC-4, DC-6 and DC-7, as well as the Lockheed Constellation, Vickers Viscount and Vanguard Turboprops. A transatlantic crossing took between 12 and 14 hours, using 4-engined aircraft carrying over 80 passengers.

Transpacific journeys required multiple stops – Hawaii, Midway and Guam.

The first commercial jet airliner was the DeHavilland Comet. With four so-called “Ghost” turbojet engines built into the wings, it first flew in 1949. Each engine developed 5000 pounds of thrust and consumed 1.2 pounds of fuel per pound of thrust per hour. Production was eventually halted due to catastrophic metal fatigue attributable to the airplane’s faulty design, but the airplane had been a game changer.

By 1955, the Pratt & Whitney JT3 engine was developing 13,500 pounds of thrust, but used 24% less fuel than the Comet’s engines.

The Douglas DC-8 and the Boeing 707 had twice the capacity and flew at twice the speed of earlier 4-engined propeller aircraft. In other words, they were four times as productive.

1970 saw the introduction of the Boeing 747, the first wide-body, with a twin aisle fuselage with three times the capacity of the Boeing 707.

At this point it was possible to say that air travel was no longer reserved primarily for the elite. The era of mass air travel had arrived.

An airplane designed exclusively for the elite, however, was the supersonic Concorde, produced cooperatively by France and the UK. Entering service in 1976, it was designed to fly 100 passengers at twice the speed of sound. It was a great technical achievement, but ultimately an economic failure. There just weren’t enough elite passengers. It ceased operating in 2003.

The development of turbofan engines in the late 1980’s substantially increased the efficiency of the turbojet. This innovation consisted of the addition of a larger fan, which passed part of the air around the engine, making it run cooler and quieter.

Steady increases in the size and range of wide-body commercial airplanes being produced by Airbus and Boeing required bigger, more powerful and more efficient engines. Improvements in the by-pass ratio have meant more power.

The Airbus A380 is the largest airliner today and can carry a maximum of 853 passengers, with a range of 15,300 kilometers and a cruising speed of Mach 0.86. Remember those “Ghost” turbojets on the DeHavilland Comet with their 5000 pounds of thrust? The A380 is powered by Rolls Royce Trent 900 engines. Each one produces 70,000 to 80,000 pounds of thrust.

A potential competitor to the A380 in terms of cost – but still to be produced – is the Boeing 777X with a range of 14,000 kilometres and a capacity of 440 passengers. The 777X engines will each deliver upwards of 105,000 pounds of thrust, and yet fuel consumption per seat will be barely 18% of that of the Comet!
Commercial aviation has become a very efficient, worldwide transportation system, currently transporting – as I said earlier — some 3.8 billion passengers a year. Travel from one side of the world to the other now takes a day or less.

Particularly because of the growing middle-class in India, China, and many other developing economies, traffic is expected to continue to grow at around 4.5 percent a year. People enjoying some measure of disposable income for the first time want to travel, and a growing aviation market is thus assured.

Given the enhanced efficiency of aircraft together with liberalization and competition, the price of air travel will continue to fall in real terms.

The question now is: Has commercial aviation reached a plateau in terms of innovation?

We could still build bigger airplanes, although some think the A380 may already be too big. How much more improvement are we likely to see in aerodynamics based on the traditional wings-on-a-tube configuration? Are our avionics and propulsion systems approaching their effective limit?

In the not too distant future we can expect to see the emergence of unconventional aircraft shapes such as a blended or hybrid wing body, increasing aerodynamics and improving structural efficiency.

Alternative positioning of the engines, perhaps above the wings or in the tail, is also being explored to reduce drag.

Development of a quiet supersonic jet is well advanced. NASA is planning to unveil a prototype in 2019, and a company called Aerion is developing a small supersonic private or corporate jet. Eventually, small commercial supersonic jets are expected to capture some 1% of the market.

Another company, curiously called Boom Supersonic, is developing a supersonic airliner using composites and today’s vastly improved turbofan engines. It will be efficient enough, its sponsors say, to match today’s subsonic business class pricing. It will comply with applicable noise regulations, they say, despite naming themselves “Boom.”

Studies to develop a hypersonic airliner are also underway, aimed at meeting the needs of wealthy customers in a hurry — London to Sydney in two to three hours, for example.

There is certainly no shortage of new ideas. Richard Branson’s Virgin Galactic project is one of them. The epic round the world flight of Solar Impulse II is another, and of course commercial drones.

Each new idea introduces a certain discontinuity in existing markets, and creates potential new markets.

They challenge us to think about the unpredictable, or even what might have been deemed “impossible” – ideas that have the potential to reshape the aviation landscape.

Most are the product, of course, of new, emerging technologies.

Richard Branson’s Virgin Galactic project is designed to commercialise space tourism.

Much was learned from the crash of the ill-fated Spaceship I. The first flight of its successor, Spaceship II, is planned for next year.
Already, over 700 people have pledged the ticket price of US$ 250,000 to enjoy a few minutes in space.

Here’s how it will work: Spaceship II will be carried by the mothership, a converted 747, to an altitude of 50,000 feet. At that point, it will separate and fire its rocket engines to reach supersonic speed. After 70 seconds its engines will cut out and the spaceship will cruise to its peak altitude.

At 31 kilometers above the earth passengers will experience true weightlessness. When they reach 100 kilometers they will achieve astronaut status, as officially defined by the Fédération Aéronautique Internationale, an aviation sports club based in Lausanne that apparently decides who is an astronaut and who isn’t.

Spaceship II will re-enter the atmosphere at an angle to minimize friction, then switch to a gliding position at an altitude of 24 kilometers above the earth. From there it will take 25 minutes to glide back to the spaceport.

One of the most remarkable accomplishments in the entire history of aviation was the successful round the world flight of Solar Impulse II, which circled the globe without burning a drop of fuel – relying simply on solar-generated electric power.

It took two men with a crazy dream to do it. Bertrand Piccard is a medical doctor, a psychiatrist by training, and a guy who had circumnavigated the world in a balloon in 1999, earning a world’s record for the longest flight ever – more than 28,000 miles. If the name Piccard sounds familiar, it’s because he’s the son of Jacques Piccard, who with American Don Walsh in 1960 dived in a bathyscaphe to the deepest place on earth, the Mariana Trench in the Pacific Ocean. Bertrand is also the grandson of Auguste Piccard, who while studying the effects of cosmic radiation in order to validate some of Einstein’s theories, climbed more than 14 miles high in a balloon. Interesting family.

The second man was André Borschberg, a mechanical engineer, an entrepreneur, and a former pilot with the Swiss Air Force.

This is a fascinating story and so I’m going to take a couple of minutes to share it with you.

Aircraft and engine manufacturers told them their dream was impossible – too big, too light, impossible to control in flight. None offered any kind of support.
During its ten years of development, the two men succeeded in raising approximately US$ 100 million from non-aviation sponsors, including makers of pharmaceuticals, watches, and elevators. The aircraft was designed by the Engineering Department of the University of Lausanne.

Solar Impulse II was powered by specially designed lithium-ion batteries weighing 366 kilos. It carried more than 17,000 solar panels on its wings. It had a wingspan of 72 meters – wider than that of a 747 –and a carbon fibre body. It weighed 2,300 kilos.

The flight plan was designed to optimise energy production and conservation. During daylight hours, the aircraft flew at an altitude of around 8,500 meters, descending to 1,500 meters at night. Remember, it was solar-powered; it flew all night long on battery power. I think it’s a problem when my rechargeable shaver dies before I’m done shaving. The consequences might be a bit different if the batteries on a solar-powered airplane died somewhere over, say, the Mariana Trench.

But the batteries never died. Solar Impulse II flew around the world in 17 legs, the longest being some 4500 miles from Nagoya, Japan, to Hawaii – a flight that took 117 hours. The two men alternated legs – only one flew at a time – and Borschberg did the Japan-Hawaii leg. That one leg turned out to be the longest solo flight in history. He was up there nonstop for five days and five nights, grabbing sleep in 20-minute catnaps. Hard to imagine.
Just for clarity, it was the longest solo flight in terms of time aloft. The previous record was set by the late Steve Faucett piloting the Virgin GlobalFlyer. He flew continuously for 76 hours – a little more than three days – the differences being that he was flying a piston-engined aircraft and circumnavigated the globe without refueling. Less time in the air, yes, but a lot more distance. I leave to you to decide which was the more remarkable achievement.

Piccard and Borschberg are now in the process of creating an international association to promote renewable energy and to encourage the development of new technology. They predict that it won’t be long before we have electric airplanes transporting up to 50 passengers on short- to medium-haul flights.
Drones. Much of the dynamism in the commercial drone market is fuelled by the interest shown by the internet giants.

Amazon and Alphabet – Google’s parent corporation — plan to use drones to deliver packages. UPS, Fedex and Deutsche Post are actively exploring similar concepts. Clearly, the “drones business” has great potential to reduce costs and improve service.

But it is likely to alter considerably the landscape of air transportation, at least at the local and regional level. Unmanned commercial aviation requires development in automated flight controls and airspace management technology including sensors and algorithms to avoid hazards and collisions with other aircraft.

And, by the way, progress in unmanned aviation technology will also benefit driverless car technology.

Unhappy with Montreal’s traffic these days? What about drones designed to carry people? Well, the German start-up E-Volo is thinking about you. It is developing a 2-seater Volo-copter, the first certified electric-powered vertical take-off and landing aircraft – VTOL — which it plans to have in service by 2018. A 4-seater is expected in 2020.

E-Volo plans to introduce these products in places such as Singapore and Dubai, forward-looking jurisdictions where the airspace is relatively small and thus more manageable.

Uber and Airbus’s Silicon Valley outpost are working together to develop a concept for helicopter ride sharing. A prototype of an autonomous vehicle designed to fly cargo or a single passenger is expected next year.

The co-founder of Google, Larry Page, is personally funding a flying car start-up, while the CEO of Tesla, Elon Musk has a project to develop an electrical VTOL aircraft.

Okay – let’s shift gears now. We’ve been talking about aviation from its beginning, through its incredible evolution over the course of the last century. As impressive as that history is, however, let’s face it – it’s wholly terrestrial.

So now it’s time for a little star-gazing!

In order to protect our species, ensure its long-term survival, and fulfill our desire to continue to explore the universe, humankind must colonize beyond Earth. All we need to do, therefore, is achieve the ability to operate routine flights between the Earth and Mars.
Why Mars? It’s on the edge of what astronomers call the “Goldilocks Zone” – not too hot and not too cold for human beings to survive. Whether it’s “just right” may be less clear. But Mars is more or less similar in size to our Earth – the photo shows them to scale — and the evidence seems to be that it has water.

How do we achieve what appears – today – to be an impossible dream?

Much has been learned from the Apollo lunar program – most importantly some very valuable lessons in how to improve the critical power-to-payload ratio.
Clearly, a new, revolutionary propulsion system will have to be one of the essential breakthroughs.

During the Cold War and the space race between the United States and the Soviet Union, successively more powerful launch systems and ever bigger and more effective multi-stage rockets were developed to launch satellites and fly astronauts into space.

The largest of these, NASA’s mighty Saturn 5, which powered the Apollo lunar program, weighed almost 5 million kilos at lift-off. The payload, however, was less than 54,000 kilos – a ratio of payload-to-booster of 1.6%. Have we reached the limit in terms of the booster to payload ratio? Certainly not.
Moreover, thanks to the International Space Station program, we are learning a lot about how to work, grow things, and even to make things in space.
Twenty-four astronauts have flown around the moon and 12 have walked on its surface. The first two missions were Apollo 11 and 12, in 1969; the last was Apollo 17 – in 1972.

But let’s get back to our mission to Mars.

As I said, we’ll need a revolutionary, completely different, propulsion system.

Thermonuclear fusion powers the sun, and the potential for nuclear fusion, particularly the issue of how to contain and exploit the energy generated, has been the subject of intense research for many years.

Scientists estimate that a fusion-powered space ship could reach around 30,000 kilometers a second — 7 to 10% the speed of light. That’s zipping right along.
Other development work has focused on Ion Thruster engines, a form of electric propulsion.

Ion thruster engines are practical only in the vacuum of space, but the technology is highly efficient in terms of consumption of the xenon gas that provides the fuel.

Of course, once we get to Mars, we’ll have to deal with a pretty challenging environment.

The surface gravity on Mars is 38% that of the Earth; the Martian atmosphere is mostly carbon dioxide — CO2; and the atmospheric pressure on the surface of Mars is about 1% of what we have on Earth.

Only trace amounts of molecular oxygen are present in the mostly CO2 atmosphere of Mars, although large amounts of ice are thought to exist both underground and on the surface. It has been estimated that if the ice at the Martian South Pole melted, the planet would be enveloped by an ocean 5 to 11 meters deep.
We know the soil on Mars contains nitrogen, sulfur, hydrogen, phosphorous, carbon, and oxygen – all elements essential to life.

As on Earth, Mars’ tilted axis results in seasonal climate variations. The average temperature is minus 46 degrees Celsius, ranging from minus 146 degrees in winter at the Poles, to plus 35 degrees in summer at the equator.

Here’s a factoid that you might find interesting: A Martian day – the time it takes Mars to rotate around its axis — is just 40 minutes longer than a day on Earth. A Martian year, on the other hand, is 686 Earth days due to its greater distance from the sun.

NASA scientists believe that it is technically feasible to bring about on Mars the very considerable climatic changes necessary for humans to live there.
Such a hugely ambitious venture would of course require major international collaboration to overcome the many challenges, and involve enormous cost.
But the pioneers of this venture needn’t be humans; they can be robots.

The prospect of the human race one day emigrating to a new planet is tremendously exciting – and definitely worth it!

In a nutshell … And still gazing into my crystal ball —

Over the next 30 to 50 years, space tourism will become a major attraction, with hotels in orbit, trips on board orbiting space modules, and even round trips to the moon.

Major developments in solar panels and in our ability to store electrical energy will enable regional and local aviation to be mostly powered by clean electricity.

And improvements in biofuel and electrical power will completely eliminate the generation of CO2 by commercial aviation.

Aviation will become totally green!

Algorithms and sensors will be perfected, leading to automated, safe personal air travel.

Personal VTOL vehicles will be widely used for urban and regional transportation, becoming viable alternatives to road transport, particularly in gridlocked urban areas.

International cargo flights will be totally unmanned, and international passenger flights will be totally automated, although they will still have one pilot on board.

And by the end of this century —

We will have mastered a new propulsion technology, and the trip from Earth to Mars will have become a daily journey – or less.

A human colony will have been established on Mars and will be developing agriculture and local automated industries.

Humankind thus will have figured out how to survive and even flourish on Mars.

Because medical science will certainly have found a way to extend – considerably – our life expectancy …

you are invited to a meeting of the International Aviation Club of Montreal on November 24, 2116, to verify the progress made by the commercial aviation industry.

Thank you!

Au revoir, Tony Tyler; Welcome Alexandre de Juniac

30 AUGUST 2016 >> 

Distinguished guests, friends and former colleagues

I am honored – and happy – to be part of this gathering on the occasion of “IATA’s Changing of the Guard”.

I have had the privilege, over the past few years, to get to know Tony Tyler and to witness his important contribution to the international aviation world. Tony’s style of leadership contrasted significantly from that of his immediate predecessor, reminding us that much can be accomplished by a persuasive, quiet and diplomatic style.

Many others have highlighted Tony’s many accomplishments which have been widely acclaimed, and I would not attempt to offend his well-known
modesty by repeating those numerous achievements here.

But I believe that I am expressing the sentiments of the entire Montreal international aviation community when I express our gratitude to Tony for his – and IATA’s – contribution here.

And in saying on their behalf, “au revoir, bon vent” and our best wishes in your future endeavours.

At the same time, I wish to say to Alexandre de Juniac “bien venu et nous espérons vous voir ici souvent – vous êtes chez vous!” as you will remember, of course, that IATA is a Canadian organization, having been created by an Act of the Canadian Parliament.

We all know that Alexandre brings to the Director General’s role – a unique combination of government experience, aerospace hi-tech manufacturing and, of course, airline leadership as CEO of a major international airline. He will require all of that experience and wisdom to steer IATA through the turbulent skies our industry faces all too frequently!

It has often been said that management is much more an “art” than a science.

Some business schools have yet to make that observation!

One of our well-known Canadian authors, “Pierre Burton”, once described a Canadian as “someone who can make love in a canoe”.

Now, I don’t know how many of you have ever tried, but I can assure you that to make love in a canoe takes a lot of determination, a certain acceptance of risk, and a great sense of equilibrium.

Determination, acceptance of risk, and a sense of equilibrium – those skills were very useful to me in my role at IATA, and I would encourage Alexandre to acquire a canoe if he does not own one already.

At times, some IATA meetings would remind me of Kevin Costner in the film “Dancing with Wolves”.

All the wolves need attention, but you must always remember that you could become fair game at any time!

Those meetings would sometimes illustrate that “common sense” is not as common as you may think.

It is useful for any Director General to practice the art of letting a consensus emerge. The D.G. does not really have the authority to impose a view. At best he can use “moral-suasion”. and appeal to the solidarity – and moral responsibility – of the participants, reminding them that an “imperfect agreement” is sometimes better than “no agreement”.

If, at the end of the day, you have not disappointed too many – and pleased quite a few – you must have done it right!

But unlike a science, art can mean different things to different people.

A visitor at a painting exhibition was truly puzzled by a Picasso painting and, since the artist was standing by, the visitor enquired
“Mr. Picasso, can you tell us what this painting means to you?”

Picasso smiled and replied “Oh,

approximately 200,000 US dollars!”

Unlike science, the art of management requires different styles for different circumstances, from Mother Theresa to Niccolo Machiavelli!

At times you need the agility of a politician

One of my favorite politicians would say “If you think it is easy to be a politician, try standing on a fence while keeping your ear to the ground!”

At other times, the role may call for the cold neutrality of an impartial judge.

Sometimes it may call for quick action. Le Prince de Talleyrand would say “the art of statesmanship is to foresee the inevitable, and to expedite its occurrence”.

In adversity, we can get some valuable lessons from Winston Churchill’s determination.

In his darkest hour, Churchill would convincingly declare “Never, never, never give up! And if you are going through hell just keep on going!”.

Ladies and gentlemen, it may be wise for me to stop here.

I do not want to sound like the “mother-in-law” giving advice to the newly weds.

It is easy for some of us who have been there to give good advice, perhaps simply to console ourselves that we are no longer in a position to set a bad example.

Once again, Tony, all the best to you!

And Alexandre, we wish you great success. I know that you can count on everyone here, myself included, to support you to the best of our abilities

Thank you very much.

Remise des bourses Pierre Jeanniot

Université de Québec à Montréal >>
Le 25 mai 2016

M. le Vice-Recteur
M. le Directeur-général
Chers boursiers … mesdames et messieurs

Une remise de bourse … c’est toujours un événement très agréable … puisqu’il célèbre la réussite académique.

Vous savez … dès sa création … la Fondation de l’Université du Québec à Montréal … a voulu privilégier l’octroi de bourse aux étudiants les plus méritants.

De fait … lors des deux premières campagnes de levée de fonds … nous avions décidé qu’au moins un tiers des fonds reçu … serait dédié pour des bourses.

C’est une question d’investir dans la matière grise … plutôt que dans les briques !

Je tiens bien sur … à mon tour … à vous féliciter … tous, chacune ou chacun … pour les succès que vous avez obtenu.

Votre réussite démontre bien l’énergie … la volonté … et la persévérance … qui sont nécessaires pour obtenir le succès.

Ce sont des qualités qui sont aussi nécessaires pour réussir dans vos carrières respectives.
Évidemment … je ne voudrais pas négliger totalement le facteur chance … par contre j’ai souvent observé … que plus on travaille … plus on est chanceux!

Et il faut savoir saisir l’opportunité lorsqu’elle se présente.

Bill Clinton … qui avait espoir de trouver un compromis acceptable au conflit Israël-Palestine … disait que Yassir Arafat était la personne qui … « ne manquait jamais une opportunité … de manquer une opportunité. »

La réputation de l’UQAM … c’est largement la réussite de ses diplômés … sans vouloir bien-sûr … minimiser l’excellence de l’enseignement et la recherche.

Mais cette réputation … l’UQAM la doit à la notoriété grandissante de ses diplômés … et j’espère bien que vous serez bientôt … vous aussi … à même d’y contribuer.

Les médias ont souvent tendance … à illustrer les turbulences … qui témoignent d’une jeunesse … un peu trop pressée … de voir notre société évoluer.

C’est le propre de la jeunesse … nous aussi à l’époque … nous avons fait notre part … mais cela peut rendre la tâche un peu plus difficile … à ceux qui dirigeait la levée de fonds.

À mesure qu’elle grandit … l’UQAM et sa fondation … auront de plus en plus besoin de fonds.

La notoriété de ses diplômés … l’excellence de ses étudiants … dont vous êtes un exemple … joue un rôle extrêmement important … auprès des entreprises qui sont sollicitées … lors d’une campagne de levée de fonds.

Nous devons être fier de notre réussite et nous nous devons … de médiatiser encore plus … les succès accomplis par nos diplômés.

À nouveau … félicitations à tous les boursiers … Je vous engage à compléter vos études avec grand succès.

Je vous souhaite … de prendre pleinement votre place … parmi les leaders de demain … et ainsi de contribuer à la notoriété de l’UQAM.

Merci … et bonne chance !



Pierre J Jeanniot, ancient président du Conseil d’administration et président fondateur de la Fondation de l’UQAM, Chloé McNeil, lauréate, et Jean-Christian Pleau, doyen de la Faculté des arts.

Pierre J Jeanniot, ancient président du Conseil d’administration et président fondateur de la Fondation de l’UQAM, Chloé McNeil, lauréate, et Jean-Christian Pleau, doyen de la Faculté des arts.
Photo : Jean-François Hamelin


Pierre J Jeanniot avec Ghania Dahim, conjointe d’Adel Benlagra, lauréat, et Luc-Alain Girdaldeau, doyen de la Faculté des sciences.

Pierre J Jeanniot avec Ghania Dahim, conjointe d’Adel Benlagra, lauréat, et Luc-Alain Girdaldeau, doyen de la Faculté des sciences.
Photo : Jean-François Hamelin


Pierre J Jeanniot avec Benoit Bourque, lauréat, et Stéphane Pallage, doyen de l’École des sciences et de gestion

Pierre J Jeanniot avec Benoit Bourque, lauréat, et Stéphane Pallage, doyen de l’École des sciences et de gestion
Photo : Jean-François Hamelin