Transport 2000 Canada Hot Line

23 November 2001

This is the Transport 2000 Canada Hotline, issue number 629, recorded on 23 November 2001, our 25th anniversary year, Bert Titcomb reporting.

In this issue...

1 - VIA shows new locomotives, Toronto Union Station improvements
2 - VIA station renovations
3 - Air industry woes may force more industry regulation
4 - Canada delays fast lane for border crossings
5 - Ottawa airport hit by Canada 3000 failure

1 - VIA shows new locomotives, Toronto Union Station improvements

On November 16th, Transport Minister David Collenette and VIA Rail Canada Chairman Jean Pelletier delivered the first of VIA's new high-speed locomotives at Toronto's Union Station. They also unveiled several of the 139 new Renaissance passenger cars which will expand the total passenger rail fleet by one third. At the same time, they also unveiled the $10 million four-year renovation of passenger rail facilities at Union Station.

The new equipment and station project are part of the federal government's $402 million capital investment in passenger rail. Passenger rail across Canada has enjoyed significant growth in ridership and revenues in recent years.

"The federal government is fully committed to the revitalization of passenger rail," said Mr. Collenette. "It makes good economic sense. It makes good environmental sense. And it expands the range of options available to Canadians in the transportation marketplace with more trains, faster trains, and better facilities across the country."

The new Genesis (P42) locomotive is the first of 21 new high-speed locomotives VIA has purchased from GTE Transportation Systems. These locomotives combine the latest in advanced technology, safety systems, and proven reliability. They will be capable of speeds up to 177 km/h and will be used to replace the LRC locomotives and to expand services in the Quebec City - Windsor corridor. These locomotives represent an $80 million investment and represent a 60 per cent improvement in emissions as compared to the locomotives they will replace.

2 - VIA station renovations

Renovations to Union Station are part of a comprehensive, system-wide program to upgrade and modernize VIA's network of passenger facilities. Recent station improvements announced or underway include:

A new, $7 million station in London, Ontario, which opened in October 2001.
A renovation of Moncton Station at a cost of $900 000.
A renovation of VIA's station in Oakville at a cost of $360 000.
A renovation of the shared VIA/GO transit station in Oshawa at a cost of $250 000.
A renovation of VIA's Kingston station at a cost of $2 million.
A redevelopment of VIA's passenger facilities in Smith Falls, in partnership with the town and local businesses.
A new station in Prince Rupert, B.C. developed in partnership with B.C. Ferries.

3 - Air industry woes may force more industry regulation

Transport Minister David Collenette stated he is open to giving Canada's competition regulators more power to ensure that no carrier abuses a dominant position in the country's air industry. He stated, "I am open to anything that enhances competition." The recent demise of Canada 3000 Inc. has strengthened Air Canada's already dominant position in this country's air travel market.

WestJet Airlines Ltd. head Clive Beddoe has already asked Ottawa to strengthen Canada's competition law to prevent predatory and anti-competitive practices. This would include granting competition authorities the power to levy "significant penalties" for anticompetitive conduct. Mr. Collenette said any moves to change Canada's Competition Act would be a cabinet decision.

Mr. Collenette said he is re-examining Canada's air competition policy, but will take a wait-and-see approach. "I think we should take stock in the next couple of months to see how things work out," he stated. "I'm told there is enough lift capability over the Christmas period to get Canadians to where they want to go, and we'll see how things evolve in the new year with other carriers picking up the slack."

4 - Canada delays fast lane for border crossings

Canada's long-planned border fast lane for prechecked importers will be delayed past its Dec.1st start date while the federal government pushes for the United States to commit itself to a similar scheme for Canadian exports. The postponement occurs as mayors of Canadian border communities are urging National Revenue Minister Martin Cauchon and two other senior cabinet ministers to press U.S. officials for quick action to reduce lingering clogs in the flow of southbound trade.

5 - Ottawa airport hit by Canada 3000 failure

The bankruptcy of Canada 3000 has delivered a $700 000 blow to the Ottawa International Airport Authority. President and CEO Paul Benoit says the airport authority is just another name on the long list of creditors seeking to recover money. "We are in court in Toronto before the judge to determine whether we'll be allowed to seize one of their airplanes," stated Benoit. "If we can seize the airplane, that would cover what we're out." Of the $700 000 loss, there is $300 000 of landing fee debt and $400 000 is owed in airport improvement fees.

In addition to the financial loss, the airport now has 35 fewer flights per week to Toronto, but Benoit hopes these will be picked up by other airlines such as Air Canada, WestJet and Bearskin Airlines. Canada 3000's collapse is another troubling development for Ottawa's airport, which has seen an increase in costs (due to additional security measures) and a decrease in traffic. Also, the facility is in the midst of a major expansion plan that is well into its first of three phases. Financing for the first phase is already in place and project is not in danger. When it is completed, Benoit says if air traffic doesn't demand a second phase, the airport would simply stick with the new $140 million terminal.

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