Taxes turning Toronto/Pearson into a laughing stock. Again.

That nutty saphist Wynne is taxing Ontario out of the global aviation market.

Air Canada has a vision of turning Toronto’s Pearson International Airport into a global aviation hub to rival Chicago’s O’Hare — but the airline’s CEO says that it could all be undone by the Ontario Liberal government’s determination to dramatically increase jet fuel taxes and drive away air traffic.

“That policy is a really bad idea,” Air Canada CEO Calin Rovinescu said in an interview Thursday in the airline’s Toronto office.

“We’re trying to build a world-class business and we cannot do it competitively with these regressive forms of taxation.”

In its most recent budget, Ontario’s Liberal government said it will increase the aviation fuel tax to 6.7 cents per litre by April 1, 2017, a 148% hike from its current level of 2.7 cents. The revenue will go towards transit and other transportation infrastructure.
Last year, more than 36 million passengers flew into or out of Pearson and the airport is on track to top that this year. Air Canada has been working to make the airport a hub for American passengers on their way to international destinations, such as Europe or Asia, and had been preparing a new focus on attracting international passengers on their way between non-U.S. international destinations — for instance, a traveller en route from Europe to South America, Mr. Rovinescu said.

Turning Pearson into an international hub is all part of Air Canada’s strategy to compete with the biggest airlines in the world. This may seem difficult to do from a relatively tiny country like Canada, but Mr. Rovinescu said airlines like the Netherlands’ KLM or the Dubai-based airline Emirates prove that it’s possible — provided Air Canada can keep its costs comparable.
Now I'll probably be the last person to defend Wynne, and I guess I'm not really defending her at all -- tax increases are tax increases, and yes they hurt business and cause long-term damage to a nation's reputation (cf. Burger King) -- but I also think a lot of the talk and supposed "benefits" of turning Pearson into an international air hub are overplayed to begin with. I remain unconvinced that there's much economic benefit to these super-hubs if the travelers are only staying for a beer and a burger. Pearson needs to set itself up as being different than the hub in Dallas or Minnesota (and be more like the hub in Chicago): a major connecting location that you might also want to visit outside of the airport itself.

I think, in general, that there are a lot of missed opportunities with airlines in having you travel to more than one spot, and if they can't manage short (<2 hour) layovers they should consider extreme (>12 hour) layovers instead. There are a lot of cities, and I would say Toronto is in this category, where you really only need about a day to see it to really appreciate it. This obviously doesn't work for Paris, or LA, or any of these big major cities (M______ once did a sixteen hour layover in London (England) to explore the city which is ridiculous for anybody who's found a week in London insufficient), but in cities like Toronto or Atlanta or Philadelphia (or, yes, Dallas-Ft. Worth) there's surely more money in having people fly in Tuesday morning, stay until Wednesday afternoon, and spending a day actually in your city putting cash to something other than whoever is scamming travelers out of every last dime at the airport. The casual business traveler probably would appreciate the extra bit of downtime (or prep time, if you need to sell a stopover the day before a conference to your boss), the tourist would appreciate the chance to see an extra city without dedicating a whole trip to it (seriously, hands up everybody who thinks that they really need to spend more than a day in Palma), and the local government will appreciate the sales tax revenue.

It's also slightly funny and provincial of us to have the largest city also be our hub airport. Dallas has definitely grown, but when the super-airport was originally built it hadn't. Chicago's an exception but Minneapolis-Saint Paul isn't exactly one of America's major metropolises. Frankfurt isn't the largest city in Germany, and Belfast isn't the largest in the UK. Let's not even speak about Iceland (mostly because the airport has to be next to the town).

The other problem with Toronto of course is that you're going to get 40,000,000,000 a year flying into your famed international hub at the same time that everybody who wants to actually fly into Toronto is also stuck there: it's why JFK or LaGuardia are some of the worst international hubs in the universe. Pearson should also try being located somewhere other than Toronto, which is about 35 millimetres away from the United States anyways: as a "Gateway to Canada" it's really really really badly placed. It's a remnant of Preston Manning's "golden horseshoe", when the Eastern Bastards were the be-all and end-all of Confederation. Really, if we're going to model the German or American system, our big international hub should be somewhere like...Churchill, Manitoba. (And don't even try to object that it's too far north to be useable)

The other bonus, of course, is that one day is more than enough to enjoy Manitoba.