To keep you in the loop with what’s going on with Canada’s largest airline, here are 10 updates from the past few weeks that involve Air Canada. We know many of you might be interested in the voucher news (and how much money they’re confiscating from travelers) and the most recent development in the Transat purchase.
Here’s what you need to know.
1. Summer schedule announced
I split it off into a separate post about Air Canada’s international summer schedule on Thursday because this is major news that is very encouraging for all travelers.
Even those who might want to avoid Air Canada to get better protections for their future bookings, or those like me who always prioritize low prices and therefore don’t often fly with Air Canada for international trips.
2. Special VIP planes for NHL teams used on regular routes
Another one that ended up requiring its own article: there is a unique opportunity to fly the all-business-class Air Canada Jetz planes that NHL teams use in June.
3. Voucher policy change
Okay, now to the part everyone cares about. I will just talk about this briefly, because we’ll have a lot more on this topic obviously: we are working hard on our refund resource initiative so we can soon help you get the money you are owed.
The fact is, sadly, all Canadian airlines (not just Air Canada—the others too) are outright lying to you when they say they don’t have to give you a refund for flights that they’ve canceled, at the very least for US and EU flights. Other destinations are a bit more of a grey area because of our government’s inaction…
But in all cases, Air Canada has announced improvements to what they call their “goodwill policy”.
It’s still horrible for you compared to the refund you are owed, but it’s less horrible at least. There are 2 improvements:
- the vouchers will no longer expire at all
- the vouchers will no longer have to be used all at once
That second one was a scam within a scam, because not only were you mathematically forced to spend more to use it fully (even though it is your own money), you would lose the balance completely if you wanted to spend less. Not very customer-friendly, to say the least. You’ll still mathematically be forced to spend more to use it fully, but at least you can be a little bit more flexible.
So at least there’s some positive, yes. But then again, if a robber left with just your TV, would you thank him for not taking both your TV and your computer?
Joking aside, you’re still stuck with the biggest problem with vouchers: you are forced to book a trip with a specific airline which will almost certainly not be the cheapest option for your new dates and destinations. Not being flexible on the airline is the absolute best way to overpay. And not just because it’s Air Canada: this is a basic principle of buying flights and is always true—maybe just even more so with Air Canada.
And about the first point, beware if your insurer was one of those that allowed you to let the credit expire and then get a cash reimbursement. With the credit/voucher no longer expiring, this likely won’t be possible. It is yet another case of those who were responsible (and had travel insurance—which isn’t that hard since many good credit cards offer it for free) possibly paying for those who didn’t, sadly. In many cases (I’ve done it once myself), if your credit expired without you using it, the insurer could no longer say that you had been reimbursed in the form of a credit and would then refund you in cash. Although, obviously every credit card insurer has a different policy and my situation was pre-coronavirus, so it’s quite possible that insurers are more stringent than usual during this very costly crisis.
Anyway, the new voucher policy will retroactively apply from March 1st. I would strongly recommend you sign up for our free newsletter to make sure you don’t miss our guide to getting a refund, this battle is far from over and we’ll do everything we can to help you get your money back.
Oh, and Air Canada is also offering a 2nd option instead of the voucher…
4. Voucher-to-Aeroplan conversion option
Air Canada is also offering to convert your voucher to Aeroplan Miles, at a 65% bonus. But a 65% bonus is not a good rate, since the base price of buying Miles without a bonus is not very good at all. That’s why it’s important to always do the math with travel rewards (our exhaustive guide to the 25 most common myths about travel rewards published last weekend is a great introduction to all the basics).
Even if I live and breathe rewards points, I would not recommend taking this option, unless you have a specific use in mind.
It’s the exact same reasoning as when thinking of buying points, because essentially that’s what you’re doing. Our Flytrippers valuation of Aeroplan Miles is 1.5¢ per point, and this option is like buying them at 1.8¢ per point. For example, if you had bought a $180 flight, you would convert that to 10,000 Aeroplan Miles. You are buying Miles at 1.8¢ per point, so you’ll need to get 1.8¢ per point in value when using them (which means saving 1.8¢ per point you use).
They’re variable-value points, so there are many scenarios where it would make sense and you’d save money, but you have to do the math. We’ll cover the detailed calculations in a separate post soon, but in the meantime you can read our guide to buying Aeroplan Miles from the recent expired promo: the examples are still valid, just change the calculations for the 1.8¢ price.
In short, you’ll see it can make sense if you usually buy expensive tickets, fly in premium cabins, or can fly from US border airports… but you have to make sure you’ll get 1.8¢ per point in value on a booking before the end of September (for flights up to one year later, into August 2021) because the program will be changing significantly in the fall. We’ll cover your to-dos before that happen if you sign up for our special separate newsletter for travel rewards points.
One last important thing: by accepting to transfer to Miles, it would probably be very hard to get the refund when Canadian airlines are forced to follow US and EU laws (likely to happen) or even if the Canadian government decides to do the right thing and force them to refund for all destinations (less and less likely to happen based on what the Prime Minister is saying). So consider that in your decision as well.
5. Amount of money confiscated
While we’re on the topic of refunds being denied, in case you are curious, we have more data from Air Canada. We told you they had $7 billion in liquidity at the beginning of April and were burning about $22 million per day in March. Well, we now know that the amount of money that they are confiscating from travelers who didn’t get the service they paid for.
It is approximately $2.6 billion. That’s a lot of Canadians who are now forced to be in the business of providing unsecured interest-free loans to a multi-billion corporation, right? You can thank you federal government for that too, not just the Canadian airlines. The airlines would have been crazy not to try this; they probably can’t believe they’ve been allowed this much leeway!
6. Amount of money AC’s CEO lost
I am honestly not in the “let’s complain about how much money CEOs make” camp, but this week many news outlets shared stories about how Air Canada’s CEO’s annual salary has been cut by more than half because of the pandemic (from $13 million to $6 million), so I figured I’d share it here if you’re interested since I’m listing news about AC anyway. You can read the story here.
7. Transat Purchase
Air Canada’s takeover of Air Transat is bad news for consumers, even the Canada Competition Bureau said it would “lessen competition”. I explained that that opinion is non-binding and the government can approve the transaction regardless and also detailed my outlook on the purchase in that post.
In short, you don’t need to have an MBA to understand that 2 of the country’s 4 largest airlines combining together will reduce competition, especially when the merged entity will control 60% of the transatlantic market in Canada. Well, this week, the European Commission also spoke out publicly with worries that the merger will result in higher prices.
The European regulators will launch an in-depth investigation into the proposed transaction. This has led Transat to activate a clause to push back the proposed closing date by one month, to July.
Obviously, the aviation landscape will change significantly due to the coronavirus pandemic, and the markets don’t seem too optimistic about the deal: Transat shares are trading at under $7, less than half of the price Air Canada has agreed to pay ($18 per share). We’ll continue to monitor this to inform you of the impacts to come for travelers.
8. Aeroplan shopping portal sale
The most basic way to earn more rewards on regular spending (by that I mean outside of welcome bonuses) is to use shopping portals. You shop on the same sites, but you click through from a portal, and you’ll earn bonus rewards. It will increase your earning by at least 100% in almost all cases. It makes no sense not to get these easy bonuses; it only requires a few clicks.
You can read the detailed post about how online shopping portals work, and even if you’re not interested in Aeroplan Miles, there is a cashback portal called Rakuten where you’ll at least earn extra cashback for almost everything you buy online (and our referral gives you a free $5 too).
Anyway, this weekend only, Aeroplan’s eStore shopping portal is having a pretty big sale with 5X bonus Aeroplan Miles on all retailers. It ends tonight. This is like getting a 7.5% return on your purchases, in addition to your credit card’s earn rate of course. That is excellent.
9. Aeroplan Elite Status shortcut
I shared the Aeroplan Elite Status shortcut opportunity a month ago for those who have American Express points, so I just want to remind you that today is the last day to participate. Don’t forget to register for the promo before transferring your points.
10. Air Canada CleanCare+
While this is by no means exclusive to Air Canada, they’ve introduced a thorough personal safety and sanitary program to make flying safer. We already told you the coronavirus simply cannot spread through “recirculated” air in planes (but it’s worth repeating given how many people believe that myth), but obviously, while the air itself isn’t an issue, proximity sure is when you’re in a metal tube.
Air Canada’s CleanCare+ program is similar to what many airlines have announced around the world in terms of high standards for sanitizing aircraft. We’ll talk a bit more about the future flight experience soon, as we start covering when we can travel again (and how to do so safely).
Bonus: Aeroplan Giveaway
It’s not the deal of the century like what we have gotten you used to, but while we’re listing news: Aeroplan has launched a giveaway where you can win a trip to either Vancouver or Montreal and it’s pretty easy to join if you like this kind of thing (let’s keep the streak alive, after one of our readers won a million Aeroplan miles worth ≈ $15,000).
To participate, all you need to do is post a picture of your takeout meal on Instagram with the #ACTakeoutToTakeoff hashtag. It’s a great opportunity to remind you that you can also get free food from Canada’s 3 food delivery apps with our referral codes. We can travel through food while we wait for actual travel to resume right?
By the way, the Montreal chef Aeroplan is partnering with for the giveaway is actually featured in the Netflix show “Somebody Feed Phil”. One of the latest episodes is in Montreal, the first Canadian city on the series. I don’t really watch TV often, but this show is one that has you traveling around the world (so it’s more about learning than entertainment) so I recommend it!
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Summary
There have been many updates from Air Canada in the past weeks; now you’re all caught up with the basics.
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Discover free travel: travel rewards
Featured image: Air Canada B777 (photo credit: Ethan McArthur)
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It is simply not my role as a customer to ensure the financial viability of a multi billion dollar corporation. Minister Marc Garneau is clear in that his mandate is to support the airline industry and not air passengers. Very disappointing. I am also disappointed that he mentions that affected customers have been offered a 24 month travel voucher. This is certainly not the case. Through Air Miles, we have been “offered” a very restrictive 13 month travel credit for our WestJet itinerary that must be booked by February. Without the enforcement of the Air Passengers Protection Regulations, the travel industry is now without standards. Depending if you purchased your flights through a travel agency or directly with the airline, there are now broad variations in what is being offered to customers in regards to refund and travel credit options. This is unacceptable. Customers require protection and enforcement of the current Regulations. The Canadian Transportation Agency and our government has completely botched this issue. If the airline industry is an essential asset, which I believe it is, then a sector wide bailout should be forthcoming. Why are customers tickets being used as a slush fund bailout for the airlines instead of the enforceable contract that it actually is?