Porter "saw a need to elevate the level of service and try to bring back a more refined nature to the whole travel experience,'' Robert Deluce says.

By FRANCOIS SHALOM, The GazetteJune 13, 2009

 

Photograph by: JOHN MAHONEY, THE GAZETTE, The Gazette

It's tempting to look upon Porter Airlines Inc. with a vague sense of déjà vu. Another fledgling eastern Canadian competitively-priced airline that deludes itself that it can take down Air Canada but is in reality fast-bound for the graveyard, one might think dismissively. The same boneyard where rest undisturbed Jetsgo, Quebecair, Nordair, Canada 3000, Air Ontario, Royal Aviation, Wardair - even the ever-so-short-lived Roots Air that, like Porter, catered to business fliers.

But making that facile equation would be a bad mistake, said Doug Reid, a Queen's University professor of strategy who specializes in dissecting airlines and who didn't mince words.

"It's a beautifully designed airline concept, designed from beginning to end to remove the hassle factor, flying out of a gem of an airport and with a business model that is holding up well despite the recession."

And Reid insisted he's not just saying that because he sits on the board of the Toronto Port Authority, which owns and operates Toronto City Centre Airport that is Porter's operational home base and head office.

Robert Deluce, president and majority owner of Porter Airlines, which he founded three years ago, knows something about the pitfalls of the airlines business. He's been immersed in flying for decades, from bush planes in the Ontario north to a seven-year stint as president of charter operator Canada 3000.

"From the beginning, (Porter) saw a need to elevate the level of service and try to bring back a more refined nature to the whole travel experience," said Deluce in a recent interview when asked whether he could survive by squeezing in between Air Canada and upstart WestJet Airlines Ltd.

Air Canada is going the other way, eliminating frills and freebies (although it did restore in-flight blankets and pillows recently). Westjet is fun, he conceded, but a little too corn pone to lay claim to elegance and sophistication.

That left some daylight for Porter, he said, which is based on "three main foundation blocks; speed, convenience and service."

The carrier currently flies its 12 Bombardier Q400 70-seat turboprops to eight cities from the harbourfront airport, including 14 flights a day to Montreal.That will climb to 18 in December with the addition this year of six planes to its fleet.

Flight attendants are decked out in retro blue uniforms, a kerchief and a pillbox hat, a throwback to the glamorous era of flying of the 1960s Pan Am Clippers. Passengers are offered - free - wine, beer and a light meal.

But the pièce de résistance, said Deluce, is the island airport.

"In Toronto, it's an $8 trip (to Union Station or Bay St.) that takes seven or eight minutes. And it's free if you take our shuttle service. That's well received."

"That airport couldn't suit me better," said Barry Lorenzetti, founder and president of BFL Canada, an insurance company with 350 employees across Canada, 110 of them in Montreal and 45 in Toronto.

"I'm a last-minute kind of guy and I can show up at the airport five minutes before the flight home," he said, saving at least two hours compared with a flight from Pearson International - and $100 in two-way taxi costs, nearly the price of a one-way ticket to Montreal.

Paul Delage Roberge, whose Les Ailes de la Mode empire has disintegrated, still shuttles weekly to Toronto to set up his latest venture, a store in Brossard to be called Le département.

"Two things really appeal," Roberge said. "The downtown airport and the fact that they treat you like a VIP. I can leave Montreal at 8:30 a.m. and by 10 a.m. I'm in downtown Toronto."

But not everyone is enchanted with the carrier.

Blogs are largely favourable, but they also show that Porter has its shares of problems - flight cancellations, mostly, which many skeptical fliers attribute to the airline not wanting to fly a near-empty plane, despite that low break-even point.

One angry passenger groused that "a $10 meal voucher and $50 toward another flight may be fine for leisure passengers, but what about business travellers who need to get to their destination on time?"

"The lounge in Toronto, the uniforms and the onboard service do not make up for the airline's inability to service the markets it flies to."

The writer was responding to another man whose story was more hair-raising. He had arrived at Newark airport on a Sunday night to return home to Toronto, but was told the flight had been cancelled and to come back the next morning. When he did - at 7 a.m. - this time he was told there would be a delay of six hours.

He fumed at the refusal of Porter to book him and his companion on an Air Canada flight as compensation. In such situations, most carriers will book fliers on competitors' next flights home.

Porter flies to Toronto, Montreal, Ottawa, Quebec City, Halifax, New York (via Newark) and Chicago (via Midway), and has seasonal flights to Mont Tremblant. It will add Thunder Bay later this month.

By year's end, it will add either Boston, Washington or Philadelphia - all three eventually. In all, said Deluce, he has identified 18 markets in North America "that will not go west of Thunder Bay and that are within 500 nautical miles" of Toronto to make full use of the Q400's fuel and speed attributes.

For the Montreal route, Malcolm Andrews of Via Rail conceded that two (and a half) years ago, "when Porter first came on the scene, we certainly noticed an immediate change."

"But a lot of the players (in transportation) did. I think it was because people were checking out the new guys, and that's totally not surprising. For us, it wasn't a major shift, more like a little dent. But it hasn't affected our ridership overall."

Air Canada and WestJet do not comment on the competition.

But is the Porter model sustainable?

Deluce will not disclose Porter's yield (revenue per seat mile) or the load factor (the number of seats sold on each flight), but says that Porter's Q400s can turn a profit at about 30 per cent load factor, compared with around 50 per cent for WestJet and 70 to 80 per cent for Air Canada.

"Anyway, we turned cash-flow positive in March of 2007 and became profitable in June 2007. And in 2008, we were 60 per cent better than in 2007," Deluce noted. "This is quite a robust model."

Even so, other smooth operators have felt the bite of the highly precarious, cyclical and capricious flying business. Predicting only clear skies ahead for Porter would be foolhardy.

Still, Deluce noted, "so far so good."

fshalom@thegazette.canwest.com

© Copyright (c) The Montreal Gazette

http://www.montrealgazette.com/story_print.html?id=1692792&sponsor=