Tag Archives: Air Canada

The Travel Troubles Continue

My decision to not go anywhere near any airport this summer is starting to look better and better as flight nightmares continue to get worse and not better.

In July, Air Canada and Pearson airport in Toronto, once again had the distinction of being the airport with the worst delays in the world. Yes, the world! Right now, the average flight delay is longer than the average flight! Just think about that for a minute..

Air Canada seems to be spending more time denying compensation or refunds than they are trying to get back on track. According to a Bloomberg story today, the airline is hiding behind “technical” and “maintenance” issues to avoid refunds that, by law, they clearly owe to their stranded customers.

Last Tuesday Air Canada cancelled a flight from Nashville to Toronto for “technical” reasons. However, flight tracking data showed this exact same airplane, an hour later, flew into Boston. So: Big fat lie on “technical” issues. But it’ll allow the airline to refuse compensation to a ton of people stranded at the Nashville airport.

An even better one was Air Canada’s notice that a flight from Montreal to Lisbon on July 17th would be delayed due to bad weather. Why? Because “bad weather” avoids passenger compensation. One slight problem: They sent this notice TWELVE days before the flight. There are lots more stories, but you get the point.

If you do run into airline “turbulence,” AKA: B.S. your only recourse will be to file a complaint with the Canadian Transportation Agency. But get ready for a one-year wait. I posted my story of attempting to get from Edmonton to Kamloops last November and only got as far as Vancouver in 24-hours. I’ve been awaiting a compensation ruling for nine months without even getting an update from the agency… Hurry up and wait: Whether you’re trying to fly or waiting to get compensated for not flying.

You May Want to Stay Grounded This Summer

Last night, Air Canada president Michael Rousseau announced that the airline would be making significant flight cut-back starting tomorrow and extending through the summer.

WHAT? Yes, like other airlines, they aren’t close to ready for the resumption of 2019 passenger volume and demand with a shortage in every position from call centres to pilots. That’s resulting in massive quantities of delays and flight cancellations. To help (not solve) the issue, airlines are reducing their flight schedule to match their current staffing levels. The alternative is the continuous chaos and massive delays experienced across North America every day. Last weekend, the hold time to contact Delta Airlines just to re-schedule a cancelled flight was 697 minutes. Do you have a cell plan or battery or the patience to sit at an airport and stay on hold for over 11 hours?

In May I thought I’d be able to resume my annual summer week in Phoenix. When I check a random week in August the airfare was double and a sub-compact car rental was quoting at $450! $1,100 just to get there and to get around? No chance. And don’t kid yourself: Economics 101 is that fewer flights mean (even) higher prices. And Westjet will immediately match (increase) their ticket prices to the same levels.

In the U.S. the airlines are hoping to get closer to some kind of reasonable normal by Thanksgiving. That’s in October! Be ready for a lot more pain, cost, and hassle with airline travel for some time to come. Or join me in sticking with staycations for this year…

AC Refunds, Lower Your Cell Bill Today & Netparcel Sure Works!

AC refunds are here: As predicted, Air Canada will now fully reimburse your non-refundable flights in order to get the federal government bailout this week. Any tickets bought since February 1st, 2020 where you cancelled the flight because of the pandemic, or the flight was cancelled by Air Canada, are eligible. Just go to aircanada.com and follow the big link section at the top of the home page. You have until June 12th to do so. They are also offering a voucher, but that will not make you a free agent – take the money back on your credit card! Westjet will follow soon if and when they agree to their bailout plan.

Cell rates: In response to Shaw entering the cell carrier market with their almost unlimited $25 plan if you are a Shaw customer, most other cell carriers have now dropped their rates. If you’re a free agent, make the call and simply tell them that you’re shopping around for a reduced monthly plan. If you’re not a free agent and locked in a contract – bad idea – and you’ll need to keep overpaying. If you deal with the big 3 of Rodgers, Telus or Bell you’ll likely also be out of luck. The main carriers (unlike their secondary providers) have a majority of customers and business clients that are not price sensitive).

My call was to FIDO (the secondary outlet of Rogers) and my plan went up 20 fold in data (2gig per month), added unlimited Canada-wide calling and free, full North America wide texting. and went from $45 down to $35! A $120 savings (23%) a year for a five-minute hassle-free call! PS: With Rodgers buying Shaw, the rate drops will likely stop in a year when the government approves the sale – and they will. Until then, enjoy the lower rates because of the competition in the industry!

Netparcel.com update: Wow! We talked about this Canada Post parcel alternative a few weeks ago and a bunch of people have already tried it. I hadn’t when we talked about it – but did use it for the first time last week. It was a 28 pound parcel Edmonton to Kelowna. The site is super easy: Do the quote, set up an account, and a bunch of courier offers pop up. Mine was $18 from UPS. Enter the details and print the label I print my labels on normal paper and then tape it onto the parcel. The site, based on your postal code, then pulls up the closest 10 drop off depots or stores for you. Even with my Canpar Courier national book sellers association rates it was almost half the price!

(Note that it’ll be a different courier and different rate each time, even for the same parcel size and weight. This is dynamic pricing so you’ll get a different rate from different couriers depending on whether they want the business that day or that hour, how busy they are, where you’re shipping from and to, etc., based on supply and demand!!)

Your Loyalty Is Costing You BIG Money

Below are the screen shots of a flight from Victoria to Edmonton. I picked it because I was booking it – and that’s what got me thinking how much WE have to pay for loyalty…

The Air Canada basic fare is $202. No seat, no checked bag, no frequent flyer miles. Pay $23 more and you get HALF of the frequent flyer miles. Or pay $44 more for 100% of the miles, a seat selection, and a checked bag.

Westjet’s basic fare is $160. So right there it’s $42 cheaper than Air Canada if you were a free agent and just shopped by price and not loyalty. But after that, Westjet is the same as Air Canada: Basic fare is zero reward dollars in their program for tier levels and perks. Pay $23 more and you get only the reward dollars. Pay $90 more for those rewards and a seat selection and checked bag.

One charges you $23 to get your points, the other charges $44. You’ll need $3,000 total (before taxes and fees) to be a somebody in their loyalty programs, and always need to pay way higher than basic fares to earn any! That’s about 12 flights which would cost you almost $300 to $500 in order to BUY your loyalty points. AND you could never fly the other airline.

As a free agent, I took the $42 cheaper flight, skipped the $23 to get my reward dollars, let the computer pick the seat instead of spending $20 or so, and my credit card waved the $30 checked bag fee. That saved me $115. THAT is a lot of money – but not something I would have done last year when I was tied to Air Canada! Even if you make the “silver” Westjet level – have a look what that gets you: 6 free lounge visits, priority boarding (the flight leaves when everyone is on – not just your zone 2, though, and two free checked bag that your Westjet credit card can get you anyway. Yes, you do get to use the reward dollars towards future travel. (Air Canada is pretty much the same rewards but with two lounge visits.) That ain’t much for about $4,500 of spending ($3,000 plus all the taxes and fees for each flight).

For 99% of us, take the cheapest flight at the cheapest price. Pay the rip-off luggage fee if you don’t have their credit card to get a free bag. And for flights under 2 or 3 hours – forget paying for a seat. I’ve done studies that show row 5 arrives at the same time as row 26. The seat pitch is awful and there’s no leg room. Step up to buying a seat only if it’s a long flight.

Hurray! I’m Now A Free Agent! (Saving $1,500)

On average, we’re in eight different loyalty programs and some of them are costing us way more than the tiny benefits we (may) get.

For years, I’ve been a medium sized somebody with Air Canada (50K Elite) where I had lounge access, two free checked bags, priority boarding and no lineups at check in. This year I’m a small somebody and lost priority boarding and lounge access. Yet, somehow I adjusted. Sure I miss the lounge, but most connections are less than two hours, and I’m just fine.

In the next month I have about 10 flights to book. I wrote down roughly what that would add up to: Around $2,200. But I can’t stay a “somebody” unless I reach $3,000 (with Air Canada and Westjet – they’re both the same) and that’s on base fares excluding all the fees and taxes. So I’d have to book more expensive tickets by over $1,500 just to stay a somebody AND would HAVE to fly only Air Canada or Westjet, or I’d dilute my earnings and not make it in either one. That applies to most loyalty programs: To get the bigger rewards you can’t be a free agent and shop elsewhere.

That seems and is stupid. (That’s why vast numbers of business travels purposely wait until the last minute to book when prices have gone way up. It maximizes their bonus levels and it’s their company that pays the ticket and the price for that.) But when we try to do that, we don’t shop around, we stay blindly loyal because we want that reward level!

Instead, I checked Westjet on a flight to Victoria this month. Their flight gets in at 9pm vs. the Air Canada at 11:30pm. That’s almost three hours of extra sleep. I also checked the last Victoria to Edmonton flight the next day: Same price on both airlines, but Westjet can get me home at 10 pm vs. 1 am for Air Canada. On the other hand, the only lunchtime flight to Grande Prairie in two weeks (August 29th) is $140 on Air Canada vs. $284 on Westjet. So of course, I booked Air Canada for that one. Ahhhh….the joy of being a free agent and looking out for my wallet instead of others!

The same applies when we see the “bonus Airmiles” offers. We’re chasing the points, but in my experience, for the 10 most common things I buy (heads up that I’m a bachelor, so it includes cookies, Bolthouse juice, Tasters Choice, etc.) Safeway/Sobey is at least 30% more expensive than Presidents Choice or Walmart. So we get three or four bucks in Airmiles while possibly spending $20 more on what we’re buying!

We, and that includes me, can be so brainwashed or blindly loyal we’re constantly tripping over a loonie to pick up a dime! Your point earnings with every program are between one and 1.5 percent. That’s it! So make sure you don’t overspend by more than 1.5% at the register or you’re losing money!

Stay loyal to friends and family – just don’t extend that same loyalty to companies who brainwash you, and aren’t ever going to be loyal back to you!

Aeroplan Sale & Cell Phone Sales

A new update on Aeroplan for the five million of us Canadians who are in the program. It turns out that your points won’t likely depreciate in value, and you won’t need to have them all cashed out next year.

The re-purchase of Aeroplan was finalized yesterday. $450 million price and assuming the ($1.9 billion) points liability the (outstanding points IF they’re all claimed…and less than 70% will be, according to Consumer Report studies). But Air Canada received $622 million from TD and another $308 million for future points. CIBC also has a card that gives you Aeroplan miles, so they kicked in $200 million and another $92 million for future points. Right now, they’re still negotiating with Amex to continue with Aeroplan.

So Air Canada paid $450 million and received over $1.2 billion. As of the purchase date, they got the whole company AND made $772 yesterday. There’ll now be a lot of competition with PC Optimum and  Esso Extra points for your business. Those two are almost immediate gratification points. A month after I signed up for Esso Extra I had a free carwash already. Aeroplan miles are more dream rewards for the long term in hoping there’ll be enough points someday way down the road for a trip to Europe.

Right after last Wednesday’s segment, the Dow dropped 660 points and this time it wasn’t President Trump’s fault, but ours. It was started by Apple announcing that iPhone sales were way down. Yesterday, Samsung announced the same thing with a 22% drop in sales.

In the U.S., as we discussed last year, there are no more two or three-year locked-in plans with a so-called free phone. You need to pay for the phone and then get a month-to-month plan. It’s increased customer satisfaction with carriers a ton and reduces your cell bill by a lot. No more being locked in for two or three years and having the almost spit on you when it comes to customer service. However, if you need to buy your phone and can’t pretend it’s ‘free’ any longer, you’ll shop around more ,and will keep your old phone an extra year or two. That’s why Apple and Samsung stock has been way down, due to less sales volume. Apple was a trillion dollar company last fall – now they’re down 40% in stock values.

It’s also why Apple started discounting the price of their phones last month! If you can’t pretend it’s ‘free,’ a thousand dollar phone is quite the shock. You can also now get an Android for under $300 and apparently the Nokia 7-1 is really inexpensive and a great phone! That trend will continue with better phones at a much lower price, and the no-contract plans will come to Canada sometime soon – so don’t be stuck in a new two or three year contract. And avoid the big marketing starting soon on 5 G phones. It’s a much faster network – way faster than your home internet. But it’ll be three years before you’ll actually have the network to use it.

Update from first January segment to try some simply your life and get rid of 100 things:

I tried the Japanese method of decluttering where you hold something in your hands and if it doesn’t bring you joy, you throw it away. So far, I’ve thrown out all vegetables, my Amex bill, the scale and a mirror!

George Boelcke – Money Tools & Rules book – yourmoneybook.com

Loyalty is Dead: This Time it’s Aeroplan

We talked last year about loyalty programs. On average we’re in a dozen programs and active in about eight.

But, if you’ve noticed, almost all of them aren’t loyal to you. Their way of getting points, freebies, dollars, or whatever are harder to get, PLUS the redemptions keep getting further and further away from happening. It’s more of a game that you’re going to lose beyond a free toaster or something minor. Yet, we’re hooked and stay loyal, despite all the evidence that we’re not getting much of a reward for it – and often for overpaying when another company is often cheaper to deal with.

The newest is a twist where the company who wants your business isn’t even loyal to their loyalty company! If you remember back, it wasn’t that long ago that Air Canada was on the verge of bankruptcy. At that time, they sold their frequent flyer miles program for some big money.

Aimia is the company that owns and runs the Aeroplan frequent flyer loyalty program. They also manage those of Nordstrom, and other companies from Europe to the Middle East.

They have five million of us Canadians as members who hold over 200 billion miles. The company itself, buys 700 million dollars of tickets from Air Canada a year. But now Air Canada is dumping the company that bailed them out to start their own loyalty program again. Needless to say, the stock was down over 76% after the announcement.

Aeroplan is done as of 2020. So the five million of us will start to get greatly reduced rewards. After all, what’s Aimia’s reason for keeping us excited when Air Canada is yanking us away from the program. By the end of next year, there’s no point chasing points that you’re not likely to get any benefit from. On my to-do list is to cash them all out by next year. I normally get Esso gift cards as they can turn into real cash when I gas up. Most other things are pretty marked up in value, so be careful before you press the “redeem” button. If you’re close to an airline ticket, book it as soon as you can before the points needed goes up again and again. If you’re not close – I’d recommend you don’t start the chase.

Loyalty Is Dead

Almost exactly two years ago we talked about Delta Airlines in the U.S. changing their frequent flyer program from miles or flights to how much money you spend with them. In other words, if you’re a price sensitive flyer that wants the cheap-charlie flights, you’re no longer getting any perks. The entire program is focused on how much profit they make from people.

At that time, I shared this would spread over the next few years. That’s now already come to pass: Starbucks has changed their reward program away from how many times you visit them, to how much you buy on each purchase. So no more rewards for the simple coffee a dozen times, but only if you buy the five dollar fancy coffee.

Thrifty Car rental gave me one free day for every 10 I rented from them. That’s gone: Now any free reward only comes when you reach some huge total dollars spent with them levels. I rent based only on price – I’m never going to see another reward from them because I’m not booking last minute expensive vehicles or rates.

But the best (actually worst) has to be Air Canada. I fly over 35 flights a  year and that was the level at which you were a small somebody. A few years ago they changed away from how many miles you flew to how many flights. Then they took a number of perks away if you didn’t fly at least 50 flights. Then they reduced the total miles for each flight and this year, it’s how profitable you are to them.

If you’re not spending $4,000 or more before taxes and all the rip-off fees, you’ll never get a single perk. I purchase the no-refund lowest price tickets versus the so-called flexible tickets at $100 or $200 more for each flight. Business travelers buy those, because they’re not price sensitive. It’s a fair guess that half of all people on their frequent flyer program have now been cut off. Oh, and to get the decent rewards, you need to spend over $10,000 a year. Add the taxes and fees, it’s about $15,000 or more in flights before you’re a somebody.

Yes, loyalty is dead. The average Canadian belongs to eight different ones. Make sure you know what you’re getting if you do stay loyal. Chances are that you’re still loyal while you’re getting shafted. If so, become a free agent and shop around for the best deal, not the companies that promise something you’ll likely never get.

Keeping You Updated

Things change pretty quickly in the world of finance, credit, money and investing. Here are some updates to things we talked about in the last few  months. You can always find the stories at yourmoneybook.com and click on the radio stories button:

A few months ago we talked about the changes for airlines and your frequent flyer miles. Well, Air Canada just did another round of cutbacks to what you’ll earn and an increase to what you’ll need to redeem. Remember to think of your reward miles like bananas. Use them up as they don’t increase in value over time! Oh, and Westjet and Air Canada now charge baggage fees – surprise! Did you think they’d just ignore the $30 to $50 million in profits that you’re now going to hand over forever?

If it makes you feel any better, the deep discount carriers in Europe and the US now charge for carryon luggage. With Spirit Air, you can pre-buy it online at $35 for a carryon. If you want until you get to the airport, it goes up to $50 and if you do it at the gate, it’s $100 for a carryon!  Oh, and you’re paying $10 to print your boarding pass.

Yikes, it’s offical: Costco is dumping American Express in Canada. You’re Amex card is no longer welcome starting January 1st. They’re now partnering with Capital One. What’s in my wallet? Not Capital One! But, it’s a good guess that they changed over for a whole lot more money from Capital One…But why go from Amex whose clients spend four times more than Visa clients to a card that targets credit challenged people? Makes no sense, even if their kick-back is way higher.

I just read two reports that show independent book stores are growing in numbers and volume of sales. Great news as I love independents. I don’t deal with Chapters – you won’t find my books with them. I’m the author of 17 books. 14 are only on my web site and three are ONLY available at a few independents, including Mosaic on Bernard. When I talk about shopping local, I actually give up a ton of sales to do so. Actions speak louder than words.

For the last month, the stock markets have gone a little nuts. Down 300 points in a day, up 200 the next. We keep talking about the dangers of buying one or two stocks. If you’ve done that, if you gambled like that, you’re probably down a ton of money. If you’ve invested in good growth mutual funds, you’re already up again. I manage a seven figure account for a relative and all the bad news last month still had a 2% return for the month with Dundee Wealth.

And if you’re a gambler, gold and silver are below 2010 prices. Bitcoin, which is an online currency is down 75% for the year. If you bet only on energy stocks, you probably lost over 40% of your money. Those one-off buys are not investing. They’re gambling – and on these and many others, it’s a big loss right now. Investing is a five year or longer time period with a mix of good growth mutual funds with a long track record. Investing is also buying a fixed amount each month. Set it and forget it.

The World of Reward Points Is Changing

The average Canadian has five reward programs of one kind or another. It might be a 10th free haircut, frequent flyer miles, 10% off if you spend over a certain amount, or rewards on your credit card.

Whatever you’ve figured out about them will be all different in the next few years. In short, the programs will be converting from volume to profitability and the opposite for credit card rewards. Right now, you’re getting rewards on your visits or spending totals. Down the road it’ll be whether you buy something profitable. No more points (or very few) to buy something at a discount, but now big rewards when you buy something way overpriced or at full retail price.

In the airline business, Air Canada has done three quiet changes to their reward programs already. Cheap seat-sale tickets now get you 25% of the miles versus full price so-called Flex tickets. Delta Airlines is already the process of fully converting their frequent flyer program. If you collect miles you need to know this. It will become the norm with every other airline. You’ll no longer earn miles based on distance flown, but on the amount you spent. It’s turning frequent flyer programs upside down. So, a last minute ticket to Vancouver at a big price will get you more miles than a discount flight to Europe.

The programs will be based on your profitability with the airline. If you make them a ton of profit – you’ll get a ton of miles. The biggest losers will be those of us who are price sensitive and bargain shop for flights. In the next few months I’m cashing out all my miles for gift cards or cash – better safe than sorry. When this comes to other airlines, you’ll be way better off getting a points reward card that lets you accumulate points for gas and other purchases – you’ll end up getting a lot more rewards than from an airline!

In the credit card world, the change will be to quantity of transactions. American Express has now introduced a new credit card that will increase your reward points by 20% once you reach 20 transactions in a month. For Amex that makes sense because their average client spends four times as much per transaction, and has a much higher average income. It’s just maximizing their transaction fees.

There was a recent study that found over a third of all reward programs are never claimed. In the airline world, according to Consumer Report, over 75% of miles are never claimed. Stop chasing and start cashing out. You won’t be a prisoner to one company or another and will become a free agent that can get the best deal from any company. I’ve started cashing out my Aeroplan miles by getting $2,000 in Esso gift cards. Check what you can redeem for the least amount of points or miles. With Aeroplan, chasing a free ticket can be a fools game. Gift cards tend to be a good deal on redemptions. Amex gift cards cost 7500 points for a $50 card whereas the Esso gift cards cost me 6500 points each.