In Canada, 2013 Was a Year of Big Change

Canada’s travel industry saw a number of big changes in 2013.

From the creation of two new airlines to implementation of new rules governing advertising of airfares, many of the events of 2013 are likely to impact Canada’s travel sellers for years to come.

Here are some of Canada’s most notable travel industry developments over the past year.

Red Tag buys Thomas Cook North America
In March, Thomas Cook North America was sold to Red Label Vacations, which operates as RedTag.ca, an online travel portal. The sale, for a pricetag of $5.2 million, was hardly a surprise given the ongoing financial struggles of Thomas Cook North America’s U.K. parent company, Thomas Cook Group.

Red Label Vacations, a privately owned firm in  Mississauga, Ontario, picked up Thomas Cook Canada Inc. and Thomas Cook USA Holdings, as well as their subsidiaries, including Sunquest Vacations and and ABC Corporate Services and D-FW Travel Arrangements Inc.

Two Canadian airlines debut
The addition in 2013 of not one but two new Canadian airlines is expected to dramatically change Canada’s air transportation scene.

WestJet launched Encore in June, with flights from its headquarters in Calgary to British Columbia destinations including Fort St. John, Nanaimo, Vancouver and Victoria. The airline plans to eventually have a fleet of 20 of the Canadian-built planes.

In July, Air Canada launched Air Canada rouge with summer service to Edinburgh, Venice, Athens and several Caribbean destinations. This winter Air Canada rouge will expand its route network with an additional 13 destinations in the Caribbean, Mexico and the U.S.

Big news
Barb Crowe, president of Ixtapa Travel, an Ensemble member in Saskatoon, Saskatchewan, said she considered the new airlines the year’s top travel news. “It has been many years since a new service was launched within Canada.

“Most certainly, it was time. Domestic travel options were limited. Secondary markets struggled with limited options and non-competitive pricing. Small markets like Saskatoon, Regina, Brandon and Victoria will benefit from increased service provided by the new carriers,” she said.
 
Crowe added that although Air Canada rouge has focused on service to Europe and southern destinations, the line is expected to add service to small markets in Canada to compete with Encore in 2014 and 2015.

Manulife takes over RBC’s Insurance business
In early September Manulife Financial began to reinsure the travel coverage sold by RBC Insurance Co. of Canada through travel agencies.

RBC insurance will continue to be the provider for those travel agencies with which it has agreements until their contracts expire. The agencies will then be offered the opportunity to renew their agreements with Manulife.

The change is significant as it gives Manulife a significant market share.

“Time will tell whether or not premiums, coverage, service and industry support will change,” said David Harris, owner of Orion Travelinx/Charisma Travel Group in Burlington, Ontario.

“RBC had been a long-term supporter of the retail travel distribution channel and was also a leader in many areas, including industry benchmarks for service standards.”

Air Pricing Rules Enacted
The Canadian Transportation Agency implemented new rules governing the advertising of airfares in May.

The rules require all advertisers of air services – for both domestic and international travel originating in Canada – to include in the advertised or quoted price all taxes, fees and charges that consumers must pay for that service.

The rules cover every type of service provider, from traditional travel agencies to call centers and service desks, and every type of advertising, including print and TV ads and even Facebook posts and Twitter Tweets.

Some travel providers were slow to act, and as a result faced warnings and/or financial penalties. Among those hit with fines were itravel2000.com ($40,000), flightcentre.ca ($21,000), Air China ($10,000), Corsair ($10,000), Etihad Airways ($10,000), Flightnetwork.com ($8,000) and American Airlines ($5,000).

CITC integrated into ACTA
After the vote of CTIC members at their annual meeting in April, the Canadian Institute of Travel Counsellors (CITC) was integrated into the Association of Canadian Travel Agencies (ACTA). After legalities were completed in July, the CITC staff relocated to ACTA’s new headquarters in Mississauga, Ontario.

The integration marks a major development for the Canadian travel industry.

“Although CITC has been an active association for Canadian travel agents for over 45 years, it had been struggling for a number of years for reasons that included unclear direction, lack of resources and limited human resources,” said David McCaig, ACTA’s president and COO.

“With CITC integrated into ACTA, it now has the opportunity to re-create a solid educational unit that will focus on certification and education for Canadian travel agents – two critical areas.”