Deregulation of the airline industry in the U.S. started in 1978 and changed travel forever. Not too long after, deregulation began to transform air travel in Canada too. And in the years inbetween, there was much debate about whether or not Canada should follow the U.S. down the deregulation path.
The headline for this edition of ‘It Happened This Week’ is: ‘ECC report: “Study into yesterday”
The ECC was the Economic Council of Canada, and its ‘Reforming Regulation’ report, found here, looked at government regulation of everything from ‘Trains, Trucks and Taxicabs’, to telecommunications, to – you guessed it – the airline industry.
Noting that restrictions on which Canadian carrier could fly where (and compete with who) were already starting to ease, the ECC said it was in favour of deregulation, and made several recommendations.
Travelweek summed it up nicely: “The report said Air Canada should be stripped of all government protection and exposed to head-on competition with CP Air.”
Travelweek also noted that ACTA lawyer Gerald Heifetz said the report was ‘looking at yesterday’s information instead of today’s realities.’
ACTA agreed with some of the ECC’s basic findings, said Heifetz. But, he added, “80% of the suggestions [in the ECC’s report] are already in practice, and the remaining 20% are impractical.”
Meanwhile Air Canada’s then-President, Claude Taylor, said that to sacrifice the airline’s role within the Canadian aviation industry would represent a “tragic mistake.” Taylor added that the ECC “appears to have been misled by its perception of the situation in the U.S., where deregulation is at best an ambiguous experiment. At its worst, it is an unalloyed disaster for the airlines as a whole which are losing money on an unprecedented scale.”
They were fighting words but progress marches on, and everyone in the travel industry knows how the deregulation debate turned out. The U.S. loosened more and more restrictions and soon enough, in 1987, many regulations governing the Canadian airline industry finally eased too. Air Canada and CP Air / Canadian Airlines (and Wardair) went head to head for market share, and the market opened up to many, many more competitors.
Did the headline appear in Travelweek in 1975, 1981 or 1996?
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