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The Startup Turbocharging the Airline Upsell Game at Online Travel Agencies

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Lufthansa Group‘s airlines have begun to use technology from startup Gordian Software to help power the upselling of add-ons through Priceline, Hopper, and other online travel agencies, Skift has learned. To Lufthansa’s eyes, the startup is just another tech vendor among dozens. But for the Seattle-based startup, the deal is a significant win.

Gordian — which focuses on helping airlines peddle add-ons such as seating assignments and checked baggage — has recently signed a flurry of deals. It now works with more than 90 airlines, including Air France, American Airlines, British Airways, China Eastern, China Southern, Delta, Emirates, Etihad, Finnair, Ryanair, Singapore Airlines, Qantas, and United. The company helps these airlines upsell passengers after booking tickets on Trip.com, Kiwi.com, and about 200 other travel agencies and resellers.

“We now have an annualized revenue run rate of $70 million, which is nine times what it was at the start of the year,” said Gordian co-founder and CEO Stephen Grabowski.

Companies helping airlines sell with greater digital savvy have become quite common. What makes Gordian Software unusual is it found a surprisingly underserved niche in upskilling brands such as TravelPerk and LastMinute.com at upselling ticket buyers after they’ve booked tickets.

Many airlines will need to flog evermore varieties of extras to regain profitability post-pandemic. That may explain many airlines’ sudden interest in Gordian. Yet the story of how this small company founded in 2017 has grabbed the attention of so many large players in such a short time is notable for what it says more broadly about industry dynamics.

While many other tech vendors have focused on helping airlines with the shopping and booking parts airline sales, Gordian has concentrated on the post-booking part, where they fine-tune the upsell.

Since 2014, many large airlines are losing money on the base ticket on many itineraries that they only make up from a margin perspective by selling ancillaries.

So you might have thought they had learned by now to play the upsell game. But you’d be wrong. A large opportunity surprisingly still remains at hand to convert more ticket buyers into buyers of add-ons.

“One example is that we recently made a change with one of our partners where we were able to increase their attachment rate of seat selection by 50 percent by making some specific user-interface changes and running some A/B tests against it,” Grabowski said. “So it’s definitely not a solved problem from even from a front-end perspective.”

Another example is Hopper, a mobile-first travel booking agency. It recently tested using Gordian to offer seat selection as a paid upsell after customers book tickets for four airlines: United Airlines, American Airlines, Delta Airlines, and Spirit Airlines.

The online travel agency said it saw strong uptake, or “high attachment rates” in the industry jargon. So this month, it said it has had made Gordian the sole provider of seat selection on more than 70 airlines for its “millions of customers.”

“Gordian’s solution is unique in the market and enabled us to launch seat selection using a fraction of the resources we would have used if we built the product internally,” said Scott Brodows, head of Hopper Flights Marketplace.

Low-cost carriers such as Ryanair, Spirit, and AirAsia have for years generated roughly a third to nearly half of their top-line revenues from the sales of extras such as reserved seats, priority baggage, and in-flight meals. But they also typically do much of that upselling directly via their websites and mobile apps. Larger airline groups are still playing catchup in both offering ancillaries and in selling them across channels.

“The moment when I knew that Gordian had legs was after I had cold-emailed several airline people at the senior vice-president level who I didn’t know,” said Gordian CEO and Co-Founder Stephen Grabowski. “I expected that these people wouldn’t respond to cold emails. But I got a 70-ish percent response rate and was landing meetings with these folks.”

Airlines often haven’t been getting any upsells in these online channels because the agencies weren’t offering them. So any gain is flowing directly to their bottom line. As a result, ordinarily bureaucratic carriers found ways to prioritize the integration.

“Airlines are large enterprises that usually take months to give access to outside developers to their technical systems,” Grabowski said. “But one major carrier gave us production access within two weeks. They did it because we had a big OTA [online travel agency] come on board that was a major distribution channel. After we emailed them to say, ‘This is what we think the business case would look like for you to partner with us,’ they acted surprisingly fast.”

Airline Ancillary Sales Get Increase Attention

So what is Gordian Software — a graduate of the Y Combinator startup accelerator in 2019 — doing exactly?

It has two products. One is essentially a data feed that an online travel agency takes and layers on top of its own user interface for selling the extras.

The startup’s other product is essentially snippets of code that an agency can put on its website or mobile app. The code gives Gordian control over what the travel shopper sees, such as the names of the upsells, bundles, and prices. That lets the company detect patterns in purchasing behavior, such as if upsells on long-haul flights are more popular than short-haul ones and what points in a process do consumers abandon a purchase. It uses that data to refine the merchandising.

Most online travel agencies may use between 10 or 20 sources for aggregating flight ticketing content, but they may not have integrated feeds for the ancillaries for all of those channels. The lack of consistent content was a problem. Shoppers might get confused why they sometimes see offers and sometimes don’t.

For the few agencies that have gone ahead and offered upsells, they have typically had to do, say, 10 different integrations to fetch content from all of the most popular airlines. Gordian is marketing itself as a way for resellers to have a single integration with it instead.

Many established players have been offering ancillaries for years, including the global distribution systems Amadeus, Sabre, and Travelport, some aggregator tech firms, and the larger airline groups themselves that have launched direct distribution channels through tech vendors such as Accelya and Travelfusion.

Some tech vendors will require an online travel agency to make the flight booking through their platform if they also want to offer the upsell. Gordian doesn’t. It lets a travel agency choose which channel to source and service the flight booking as a separate decision from where it sources and services the ancillaries.

When an online travel agency uses multiple ancillary providers, Gordian has to track metrics to if it does a better job on volume airline by airlines.

“For example, many times when a consumer selects a seat on a seat map, the selection gets dropped from the final booking,” Grabowski said. “We’re focused on avoiding technical failures like that. We’ve had situations to show a greater than 50 percent increase in terms of actual seats booked compared with other ancillary providers.”

So far, so straightforward. But travel isn’t complicated. Aircraft can get switched out, which can mean a seat assignment a customer paid for is no longer available. Grabowski claimed his company checks to make sure the ancillary remains valid and intact.

“We raise it to the airlines, saying, ‘Hey, this customer should receive a refund for X, Y or Z reason,’” Grabowski said. “Or we will manage that customer service ourselves.”

Some industry nerds may wonder who issues the so-called “Electronic Miscellaneous Document,” or EMD, for the ancillary? That depends on the content provider’s business model. Sometimes the airline issues it, and sometimes the global distribution system that connects airlines to agencies does it.

In short, there’s a lot of complexity for tech vendors like Gordian to tame.

One perplexing area is the “bundles” that airlines have been offering lately. Some low-cost carriers will bundle other services with their extra legroom upsells, including priority boarding or a free checked bag and seat selection with the purchase. Yet today, many online travel agencies still don’t have user interfaces that can explain the bundles because of a mix of technical and commercial obstacles. Fixing that could boost sales.

Business travel is another opportunity. Let’s say you return to being a frequent business traveler after the pandemic eases and you have status in an airline’s loyalty program. When you book leisure travel on that same airline, you may qualify for perks, such as a complimentary free checked bag. But it remains a technical and commercial challenge to connect all the dots behind the scenes and make sure that a shopper sees offers and pricing that reflects what they qualify for.

A challenge facing travel management companies is how they can round out their offering by adding ancillaries in a way that doesn’t require them to make deep changes in their ticketing strategy, given their complicated recent conversations with airlines about distribution.

To tackle the above segments, Gordian Software said its next task is to design, build, and launch an API [an application programming interface] to standardize searching and purchasing any airline product. That is easier said than done. The 50-employee company hasn’t disclosed its funding, though Crunchbase says it closed an $8.1 million round this month.

Grabowski and co-founder and chief technology officer Joe Sarre aren’t new to the travel sector. Both previously worked at Skyscanner, the price-comparison search engine. (Sarre was among the first 15 employees at Skyscanner.) Grabowski got his start working at Google’s travel division ITA Software. These experiences gave them views of the problems of online selling and behind-the-scenes integrations.

“We see the market for us is helping airlines do upsell anywhere they want that’s not their own direct ticketing,” Grabowski said. “That means not just OTAs, our market right now, but also travel management companies and metasearch and even airlines who have interline or code-share or virtual interlining partnerships where they have had difficulties offering ancillaries from some of their partner airlines.”

Photo Credit: Lufthansa Business Class as seen in 2012 on a Boeing 747-800 aircraft. The airlines of the Lufthansa Group have selected Gordian
Software as its latest distribution tech partner. Lufthansa Group

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Source: https://skift.com/2021/07/01/the-startup-turbocharging-the-airline-upsell-game-at-online-travel-agencies/

Aviation

Hydrogen Demand: Hydrogen Is Not A Growth Market, It’s A Diminishing One (Part 1 Of 3)

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Hydrogen continues to be a heavily discussed area in the low-carbon transition. Michael Liebreich just updated his excellent hydrogen ladder, and unlike others including me, has made his conditional peace with blue hydrogen. Paul Martin continues to publish and discuss why hydrogen is a decarbonization problem, not a decarbonization solution. Mark Z. Jacobson has published a study with Robert Howarth that I agree with, but Liebreich doesn’t, on the significant carbon emission increases if ‘blue’ hydrogen were to be used.

It’s worth quoting Liebreich from his recent LinkedIn post asserting his reasoning:

“This is why I have made my peace with blue hydrogen. I simply cannot see sufficient quantities of green hydrogen being produced fast enough and with low enough environmental impacts to meet demand – even though I believe only those use cases high up my ladder will materialise.”

I agree completely with the unlikelihood of green hydrogen being able to meet increasing demand for hydrogen. Where I disagree with Liebreich is that I project substantial decline in hydrogen demand. I have been asked to do a projection out for a few decades of a likely scenario by several people, just as I’ve done for other key areas such as oil demand impacts related to electric vehicles, vehicle-to-grid penetration, and the market for grid storage. As always, these are thought exercises with my point in time knowledge as someone who continues to guide companies through the thickets of long-term value creation as we move toward our decarbonized future, not predictions of exactly what will occur. At very best, all projections of the future are through a glass, darkly. I will be wrong in interesting ways, but I think I’m more right than wrong.

Hydrogen demand through 2100

Hydrogen demand through 2100 by author

And so, my projection. Let’s start with the list of demand points I bothered to list. Liebreich’s ladder has 35 use cases for hydrogen across seven levels of his ladder, from unavoidable to uncompetitive. A big point his ladder does not address is the variance through time of his ‘unavoidable’ category, something he and I have started a discussion on, one we’ll hopefully be able to have on CleanTech Talk soon.

As always in my projections, I disregard elements I consider immaterial, and focus here on 10 where there is significant demand today, likely significant increases in demand, or where there are what I perceive to be completely unrealistic hopes of significant demand increases.

Demand for 10 major current and projected uses for hydrogen in millions of tons per year

Demand for 10 major current and projected uses for hydrogen in millions of tons per year by author

The 10 points of demand start with the dominant current uses, with overlap from Liebreich’s ladder and IRENA’s 2019 assessment of the current hydrogen market. I had been using the IEA’s breakdown, but as Martin pointed out in our discussion, IRENA’s captures a great deal of hydrogen that is created in mixed chemical form which is also essential to understand, something the IEA excludes. The future projections are ones that many are promoting today as decarbonization solutions, and collapse large numbers of Liebreich’s ladder into three categories.

To be clear, some things in his ladder, such as fuel for vintage vehicles, will be produced, but I consider the volumes to be immaterial and so collapse them, along with all forms of transportation, into a single component. Four years ago my perspective was that hydrogen had not yet proven itself to be non-viable for long-haul shipping and aviation, but four years has been sufficient to convince me that it isn’t viable in those modes either.

It’s worth going through each of my 10 categories and explaining what they encompass and my logic, as this piece is intended to trigger discussion, debate, and inevitably corrections as well. A bread crumb trail of reasoning is useful in that regard, both for me to remember my own thinking, but also to allow others to point out errors more readily.

Desulfurization (Hydrotreatment) & Hydrocracking: From 38 Million Tons Down To 2 Million

Liebreich separates these, while others put them together. I wasn’t able to find a breakdown in IEA or IRENA literature or other sources for them individually, so have chosen to show each of them with 50% of the current 38 million tons of demand. (Please reach out if you have a source with a better breakdown of the two.)

As I published a while ago, these are uses of hydrogen in petroleum refineries, and represent the only growth market in the past 30 years for the molecule. Desulfurization of fuels was required due to acid rain and other air pollution, although Martin points out that despite a requirement for using desulfurized fuels in long-haul shipping, there was exactly zero movement in the market for the leave-behinds of the refinement process that most oceanic freight ships use for fuel, so he suspects that it’s a widely ignored rule out of sight of land. Hydrocracking converts heavy fuel oil components into naphtha, kerosene, jet fuel, diesel oil, or high-quality lubricating oils.

As I commented on Liebreich’s post regarding any expected growth in hydrogen demand, if we aren’t substantially lowering our use of petroleum-sourced fuels in the next few decades, we aren’t solving climate change. With Equinor and McKinsey both projecting peak oil demand in the next decade, and the 400,000+ electric buses in China already eliminating demand for 270,000 barrels of oil every day, there is no world in which hydrogen consumption in refineries stays the same in the coming decades or global warming is even slowed.

I project a slight decline in hydrogen demand by 2030 from 38 to 36 million tons, and a decline down to only 2 million tons by 2100, with the most rapid declines between 2040 and 2060.

Fertilizer: 31 Million Tons Down To 5 Million

This is a big demand area, and we will continue to need to provide nitrogen to crops to feed our billions, even as population peaks. But hydrogen demand for ammonia has been flat for three decades despite massive population increases, so it’s not a growth market. Further, ammonia fertilizer is made from black hydrogen today, with roughly 3x the mass of CO2 as of delivered fertilizer, and much of nitrogen in the fertilizer that was originally part of the 78% of nitrogen in our atmosphere is transformed by soil biological processes into nitrous oxides with global warming potentials 265x that of CO2. In a recent discussion with PhD and CEO Karsten Temme of Pivot Bio, he estimates another 6x of CO2e in the form of nitrous oxide. In other words, every ton of fertilizer represents roughly 9 tons of CO2e emissions, making fertilizer use in agriculture one of the largest single sources of annual CO2e emissions globally, roughly 10%.

That means that hydrogen for fertilizer isn’t a demand area, it’s a problem area. And there are solutions. I’ve assessed and continue to assess agricultural transformation to deal with its emissions, and I see three. The first is low-tillage agriculture, where instead of plowing furrows into fields at end of harvest, allowing most of the temporarily sequestered carbon to escape and then laying down a thick layer of fertilizer, cover crops are left in place, and cash crops are planted by poking individual holes into the ground to seed. This intersects with another major trend, and a reason why fertilizer (and pesticide and herbicide) demand has been flat — precision agriculture. This model uses computers and GPS to put seeds, fertilizer, pesticides, and herbicides in the exact places needed, with measured doses, instead of covering a field with a thick layer of fertilizer, most of which doesn’t usefully help crops grow. GPS, computers, and automated delivery systems are cheap and reliable, so will spread rapidly. The third trend is the increase in biogenetic fixing of nitrogen. Temme and Pivot Bio engineered pre-existing soil microbes to continue to emit nitrogen even in the presence of lots of fertilizer, and are already diverting 20-25% of fertilizer use with 6-7% crop yield increases on a million acres of corn. They are targeting 100% by 2030, an admirable goal, with the three largest cereal crops — corn, grain, and rice — in their sights. And they aren’t alone in the space.

The combination of the three major trends clearly indicates to me that the age of massive fertilizer use is coming to an end, and so I project it to diminish from its current 31 million tons of hydrogen demand annually to 5 million tons by the end of the century.


And so much for Part 1, where the two biggest consumers of hydrogen today are found to be disappearing rapidly, not persisting, and definitely not growing — not a good sign for the hydrogen economy. In Part 2 I explore several hyped uses that are going to fall very flat, and the one real growth demand area.

 

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Source: https://cleantechnica.com/2021/09/16/hydrogen-demand-1-3-hydrogen-is-not-a-growth-market-its-a-diminishing-one/

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Hydrogen Demand: Hydrogen Is Not A Growth Market, It’s A Diminishing One (Part 1 Of 3)

Published

on

Hydrogen continues to be a heavily discussed area in the low-carbon transition. Michael Liebreich just updated his excellent hydrogen ladder, and unlike others including me, has made his conditional peace with blue hydrogen. Paul Martin continues to publish and discuss why hydrogen is a decarbonization problem, not a decarbonization solution. Mark Z. Jacobson has published a study with Robert Howarth that I agree with, but Liebreich doesn’t, on the significant carbon emission increases if ‘blue’ hydrogen were to be used.

It’s worth quoting Liebreich from his recent LinkedIn post asserting his reasoning:

“This is why I have made my peace with blue hydrogen. I simply cannot see sufficient quantities of green hydrogen being produced fast enough and with low enough environmental impacts to meet demand – even though I believe only those use cases high up my ladder will materialise.”

I agree completely with the unlikelihood of green hydrogen being able to meet increasing demand for hydrogen. Where I disagree with Liebreich is that I project substantial decline in hydrogen demand. I have been asked to do a projection out for a few decades of a likely scenario by several people, just as I’ve done for other key areas such as oil demand impacts related to electric vehicles, vehicle-to-grid penetration, and the market for grid storage. As always, these are thought exercises with my point in time knowledge as someone who continues to guide companies through the thickets of long-term value creation as we move toward our decarbonized future, not predictions of exactly what will occur. At very best, all projections of the future are through a glass, darkly. I will be wrong in interesting ways, but I think I’m more right than wrong.

Hydrogen demand through 2100

Hydrogen demand through 2100 by author

And so, my projection. Let’s start with the list of demand points I bothered to list. Liebreich’s ladder has 35 use cases for hydrogen across seven levels of his ladder, from unavoidable to uncompetitive. A big point his ladder does not address is the variance through time of his ‘unavoidable’ category, something he and I have started a discussion on, one we’ll hopefully be able to have on CleanTech Talk soon.

As always in my projections, I disregard elements I consider immaterial, and focus here on 10 where there is significant demand today, likely significant increases in demand, or where there are what I perceive to be completely unrealistic hopes of significant demand increases.

Demand for 10 major current and projected uses for hydrogen in millions of tons per year

Demand for 10 major current and projected uses for hydrogen in millions of tons per year by author

The 10 points of demand start with the dominant current uses, with overlap from Liebreich’s ladder and IRENA’s 2019 assessment of the current hydrogen market. I had been using the IEA’s breakdown, but as Martin pointed out in our discussion, IRENA’s captures a great deal of hydrogen that is created in mixed chemical form which is also essential to understand, something the IEA excludes. The future projections are ones that many are promoting today as decarbonization solutions, and collapse large numbers of Liebreich’s ladder into three categories.

To be clear, some things in his ladder, such as fuel for vintage vehicles, will be produced, but I consider the volumes to be immaterial and so collapse them, along with all forms of transportation, into a single component. Four years ago my perspective was that hydrogen had not yet proven itself to be non-viable for long-haul shipping and aviation, but four years has been sufficient to convince me that it isn’t viable in those modes either.

It’s worth going through each of my 10 categories and explaining what they encompass and my logic, as this piece is intended to trigger discussion, debate, and inevitably corrections as well. A bread crumb trail of reasoning is useful in that regard, both for me to remember my own thinking, but also to allow others to point out errors more readily.

Desulfurization (Hydrotreatment) & Hydrocracking: From 38 Million Tons Down To 2 Million

Liebreich separates these, while others put them together. I wasn’t able to find a breakdown in IEA or IRENA literature or other sources for them individually, so have chosen to show each of them with 50% of the current 38 million tons of demand. (Please reach out if you have a source with a better breakdown of the two.)

As I published a while ago, these are uses of hydrogen in petroleum refineries, and represent the only growth market in the past 30 years for the molecule. Desulfurization of fuels was required due to acid rain and other air pollution, although Martin points out that despite a requirement for using desulfurized fuels in long-haul shipping, there was exactly zero movement in the market for the leave-behinds of the refinement process that most oceanic freight ships use for fuel, so he suspects that it’s a widely ignored rule out of sight of land. Hydrocracking converts heavy fuel oil components into naphtha, kerosene, jet fuel, diesel oil, or high-quality lubricating oils.

As I commented on Liebreich’s post regarding any expected growth in hydrogen demand, if we aren’t substantially lowering our use of petroleum-sourced fuels in the next few decades, we aren’t solving climate change. With Equinor and McKinsey both projecting peak oil demand in the next decade, and the 400,000+ electric buses in China already eliminating demand for 270,000 barrels of oil every day, there is no world in which hydrogen consumption in refineries stays the same in the coming decades or global warming is even slowed.

I project a slight decline in hydrogen demand by 2030 from 38 to 36 million tons, and a decline down to only 2 million tons by 2100, with the most rapid declines between 2040 and 2060.

Fertilizer: 31 Million Tons Down To 5 Million

This is a big demand area, and we will continue to need to provide nitrogen to crops to feed our billions, even as population peaks. But hydrogen demand for ammonia has been flat for three decades despite massive population increases, so it’s not a growth market. Further, ammonia fertilizer is made from black hydrogen today, with roughly 3x the mass of CO2 as of delivered fertilizer, and much of nitrogen in the fertilizer that was originally part of the 78% of nitrogen in our atmosphere is transformed by soil biological processes into nitrous oxides with global warming potentials 265x that of CO2. In a recent discussion with PhD and CEO Karsten Temme of Pivot Bio, he estimates another 6x of CO2e in the form of nitrous oxide. In other words, every ton of fertilizer represents roughly 9 tons of CO2e emissions, making fertilizer use in agriculture one of the largest single sources of annual CO2e emissions globally, roughly 10%.

That means that hydrogen for fertilizer isn’t a demand area, it’s a problem area. And there are solutions. I’ve assessed and continue to assess agricultural transformation to deal with its emissions, and I see three. The first is low-tillage agriculture, where instead of plowing furrows into fields at end of harvest, allowing most of the temporarily sequestered carbon to escape and then laying down a thick layer of fertilizer, cover crops are left in place, and cash crops are planted by poking individual holes into the ground to seed. This intersects with another major trend, and a reason why fertilizer (and pesticide and herbicide) demand has been flat — precision agriculture. This model uses computers and GPS to put seeds, fertilizer, pesticides, and herbicides in the exact places needed, with measured doses, instead of covering a field with a thick layer of fertilizer, most of which doesn’t usefully help crops grow. GPS, computers, and automated delivery systems are cheap and reliable, so will spread rapidly. The third trend is the increase in biogenetic fixing of nitrogen. Temme and Pivot Bio engineered pre-existing soil microbes to continue to emit nitrogen even in the presence of lots of fertilizer, and are already diverting 20-25% of fertilizer use with 6-7% crop yield increases on a million acres of corn. They are targeting 100% by 2030, an admirable goal, with the three largest cereal crops — corn, grain, and rice — in their sights. And they aren’t alone in the space.

The combination of the three major trends clearly indicates to me that the age of massive fertilizer use is coming to an end, and so I project it to diminish from its current 31 million tons of hydrogen demand annually to 5 million tons by the end of the century.


And so much for Part 1, where the two biggest consumers of hydrogen today are found to be disappearing rapidly, not persisting, and definitely not growing — not a good sign for the hydrogen economy. In Part 2 I explore several hyped uses that are going to fall very flat, and the one real growth demand area.

 

Appreciate CleanTechnica’s originality? Consider becoming a CleanTechnica Member, Supporter, Technician, or Ambassador — or a patron on Patreon.

 

 


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Source: https://cleantechnica.com/2021/09/16/hydrogen-demand-1-3-hydrogen-is-not-a-growth-market-its-a-diminishing-one/

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Air Transat’s Manchester flights to resume earlier than planned

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From TravelWeek – link to source story

Air Transat’s Manchester flights to resume earlier than planned

Date: Sep 14 2021

By: Travelweek Group

MONTREAL — Air Transat is resuming operations to Manchester, England earlier than originally planned in anticipation of significant passenger demand for the United Kingdom.

Following eased travel restrictions in the U.K., with Canada now on its green list of approved countries, the airline will start offering direct flights to Manchester from Toronto on Oct. 19.

Air Transat is also resuming direct flights between London Gatwick and Toronto on Sept. 15 after months of inactivity. Flights will initially operate three times weekly between the two hubs and will gradually increase over the coming months.

Direct flights from Glasgow to Toronto are also scheduled to resume on Dec. 16.

Air Transat previously announced that it will fly to nearly 50 destinations as part of its winter 2021/2022 flight program. It previously celebrated its return to the skies on July 30, following a six-month pause in operations due to COVID-19 travel restrictions.

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Source: https://canadianaviationnews.wordpress.com/2021/09/16/air-transats-manchester-flights-to-resume-earlier-than-planned/

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Summer travel surge has WestJet and Air Canada asking for volunteer help

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From CBC News – link to source story

Passenger traffic has reached its highest point since pandemic began

Kyle Bakx · CBC News · September 16, 2021

The COVID-19 pandemic has ground an unprecedented number of flights in Canada and around the world. (Darryl Dyck/The Canadian Press)

A surge in summer travel across the country has forced Canada’s two biggest airlines to ask staff to help volunteer at airports to overcome staffing challenges — a move that is creating pushback from unions.

In an email to all employees, WestJet described how the rapid growth in passenger numbers is causing operational problems at several airports, including its flagship airport in Calgary.

The “growing pains of recovery requires all-hands-on-deck,” read the message, which included an open call for any staff members to sign up to volunteer to help guests requiring wheelchair assistance at the Calgary International Airport.

Meanwhile, Air Canada has needed extra personnel at Toronto’s Pearson airport since “airport partners are stretched beyond their capacity, which led to significant flight cancellations and missed connections,” read an internal memo.

In late August and early September, air passenger traffic reached its highest point since the pandemic began. The increase in business is critical to the aviation industry, which was devastated early on in the crisis as many countries restricted international travel.

The industry is not immune to the staffing challenges faced by many sectors as lockdowns started to lift; airlines continue to cope with changing government restrictions, while also following a variety of COVID-19 protocols at domestic and international airports.

In the U.S., American Airlines and Delta Air Lines also asked staff to volunteer at airports this summer.

At Toronto’s Pearson, the international arrival process can take up to three hours, as passengers are screened by Canada Border Services Agency and Public Health Agency of Canada agents, collect bags and possibly take a COVID-19 test.

“As the technology for sharing and displaying vaccine documents improves, passengers become more comfortable with the new process and vaccine-driven changes in border protections take effect, we hope to see further improvement in wait-time conditions in the terminals,” a Pearson spokesperson said in an email statement, which highlighted other steps to reduce delays.https://datawrapper.dwcdn.net/mrCsu/1/

Union objections

But several unions have advised their members to avoid volunteering for a variety of reasons.

CUPE, which represents flight attendants at WestJet, declined to comment. However, in a letter, it told members that “the company is imploring you to provide free, volunteer and zero-cost labour. THIS IS UNACCEPTABLE.”

The Air Line Pilots Association, which represents WestJet’s pilots, also declined to comment. But in a message to members, it highlighted how “if you are injured doing this work, you may not be covered by our disability insurer.”

Unifor, which represents customer service agents at both of Canada’s major airlines, said its members were upset about the call for volunteers and the union wasn’t happy that there wasn’t any advanced warning or conversation.

“Take a group of workers that is already very stressed by the kind of operation that’s going on, the quantity of passengers, the amount of extra processes that are in place because of COVID in order to travel — and then adding these pieces on is not helpful,” said Leslie Dias, Unifor’s director of airlines.

During the pandemic, WestJet decided to outsource the work of guest-service agents, who would help passengers that require wheelchairs, assist with check-in kiosks and co-ordinate lineups.

But the contractor is struggling to provide enough workers, said Dias, and that’s why there was a call for volunteers.

After flying more than 700 flights daily in 2019, WestJet flew as few as 30 some days during the pandemic. Currently, there are more than 400 flights each day.

“WestJet, as is the case across Canada and across many industries, faces continued issues due to labour hiring challenges as a result of COVID-19,” said spokesperson Morgan Bell in an emailed statement.

“As WestJet looks ahead to recovery, we continue to work toward actively recalling and hiring company-wide, with the current expectation we will reach 9,000 fully trained WestJetters by the end of the year, which is more than twice as many WestJetters as we had at our lowest point in the pandemic some five months ago,” she said.

Air Canada said it only asked salaried management to help volunteer at Pearson airport. 

Unifor said the airline was short of workers because the company didn’t have enough training capacity to accommodate recalled employees and couldn’t arrange restricted-area passes on time.

Thousands of airline workers lost their jobs, were furloughed or faced wage reductions last year, although the carriers are bringing back workers as travel activity increases.

Officials at Toronto’s Pearson airport say they are trying to reduce delays and wait times by bringing back the international-to-domestic connection process, which helps some arriving international passengers that are connecting onward in Canada to complete the customs process faster and go directly to their next flight. (Evan Mitsui/CBC)

Returning staff

At WestJet, its customer service agents have been recalled, according to Unifor. Many employees in other positions, though, remain out of work, including about 500 furloughed pilots.

Air Canada said it has been continually recalling employees since last spring, including more than 5,000 in July and August.

Asking for volunteers is an “unusual” occurrence in the industry, said Rick Erickson, an independent airline analyst based in Calgary. But he said it’s not surprising since cutting a workforce is much easier than building it back up.

Airlines have to retrain staff, secure valid certification and security passes, and find new hires as well.

Erickson said he even spotted WestJet CEO Ed Sims helping at the check-in counter in Calgary in recent weeks, as passenger activity was at its peak so far this year.

“This has been the most challenging time, honestly, in civil aviation history; we’ve never, ever seen anything approaching 90 per cent of your revenues drying up,” said Erickson, noting that airlines still have to watch their finances closely.

WestJet CEO Ed Sims is shown at the airline’s headquarters in Calgary. He’s been helping at the check-in counter at the Calgary airport in recent weeks. (Kyle Bakx/CBC)

Asking employees to volunteer isn’t illegal, but it does raise some questions, said Sarah Coderre, a labour lawyer with Bow River Law LLP in Calgary. 

“Whether or not it’s fair, and the sort of position it puts the employees in, if they choose not to volunteer, that would be concerning for me from a legal standpoint,” said Coderre.

Air Canada is currently operating at about 35 to 40 per cent of its 2019 flying capacity, but said one bright spot on the horizon is bookings for winter getaways toward the end of this year and the beginning of 2022.

“When looking to the sun leisure markets, we are very optimistic about our recovery,” a spokesperson said by email. “We are currently observing demand growth that is above 2019 levels.”

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Source: https://canadianaviationnews.wordpress.com/2021/09/16/summer-travel-surge-has-westjet-and-air-canada-asking-for-volunteer-help/

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