By Jenny Wagler
It’s turbulent times for Vancouver’s float-plane industry in general and dominant player Harbour Air Ltd. in particular.
A standoff continues between the majority of local float-plane operators and managers of the nearly completed new Vancouver Harbour Flight Centre (VHFC) terminal. Just two tenants – Seair Seaplanes and Tofino Air – have signed leases at the new terminal.
Meanwhile, the Vancouver Harbour Commercial Seaplane Operators Association’s rival plan for its Harbour Hub non-profit terminal on the east side of Canada Place is inching its way through a Port Metro Vancouver (PMV) application process.
The PMV rejected an earlier incarnation of the plan a year ago.
The stakes are high for the VHFC, which has thus far failed to land the biggest float-plane company in town as a tenant, but they’re equally rich for Harbour Air.
Its Vancouver harbour lease is set to expire when the VHFC opens May 25, but the company has yet to establish where else in the harbour it would operate.
Meanwhile, two recent court cases highlight ongoing disputes resulting from Harbour Air’s West Coast Air acquisition last April. But Greg McDougall, float-plane industry veteran and Harbour Air Group CEO, is staying the course.
“I think we’ll probably get some fairly firm direction pretty soon,” he said. “Sometimes people have to come to the edge of the cliff and look over before they come to a solution.”
Where that solution will come from, however, is unclear.
McDougall said the Harbour Air Group, which includes the Harbour Air and West Coast Air brands, along with maintenance provider Aero Flite International Services Ltd. and Victoria’s Flying Otter Grill – is “not directly” talking to the VHFC’s managers now. But he said there’s “some movement,” on that front.
McDougall pointed to the suggestion in late February from Vancouver Convention Centre operator BC Pavilion Corp. that a third party review the business concerns on both sides and make non-binding recommendations, as a way to kick-start talks.
McDougall said Harbour Air is open to that, depending on the terms of reference.
“We want to make sure this isn’t all about what price these guys [at VHFC] are going to charge,” he said. “The facility really should be a not-for-profit – we’ve said that all along. And that, for us, is a fundamental because anything other than that and the travelling public is paying more than they should for no value added.”
But failing a solution on that front, McDougall said he didn’t know whether his company can extend its lease with the City of Vancouver.
The company, he said, could operate out of its Richmond facility, but it would have to run a shuttle between it and the port.
“We enlarged our terminal space at Richmond quite drastically in the last while for that reason. So that’s absolutely a possibility.”
McDougall is keen on moving the current Harbour Air facility to the east side of Canada Place, as the operators pursue the Harbour Hub plan, but he conceded that the port is “not big on it, but it’s still a possible solution.”
What isn’t a solution, for McDougall, is “to pay ransom to a private developer,” as he termed the rejected VHFC rent formula, which he said would add $12 to each Harbour Air passenger ticket.
“You start adding those kind of levies onto our passengers to pay for the facility, you drive our business down, and as the passenger numbers go down, the per-head numbers go up because it’s a fixed rate and that’s a death spiral for us,” he said. “So it really is that critical an issue; it’s the industry’s survival.”
Against this stormy industry backdrop McDougall said the dust is starting to settle internally at Harbour Air since last year’s acquisition of its top competitor, West Coast Air.
He called the two recent court cases – one, launched by former Harbour Air president Rick Baxter alleging the company didn’t pay him $400,000 in severance; the other launched by Harbour Air alleging that Baxter sold the company faulty planes, which cost the company $1.25 million to repair – “an unfortunate byproduct of the amalgamation.”
He commented that the acquisition happened in “a very big hurry” due to financial considerations on West Coast Air’s side.
McDougall said he expected to see the two lawsuits resolved out of court soon.
“It’s just a disagreement in what we thought we were buying and what we ended up with and so we’re negotiating it out. Unfortunately, sometimes you need to go to the legal end just to get things solved, and hopefully we’ll never have to follow through with that part.”
But as questions hover over the company and over the float-plane industry, McDougall said he sees one clear positive in the dispute and the associated public and political attention the industry has attracted.
“This is a moment in history where the industry is being kind of legitimized in terms of its prominence in transportation in the province.”
In terms of passenger travel, he said Vancouver’s port is the fourth-largest airport in B.C. and the ninth largest in Canada .
“You just wouldn’t have this [dispute] with a major airport; there’s no airport in Canada that has private ownership where somebody is not just doing cost recovery, because it’s considered to be transportation infrastructure. Well why should that be any different for float planes?”