In August 2019, Victoria International Airport recorded a drop of 11.5 in flights and 10.9 per cent in passengers compared to August 2018. Flights and passengers through the first eight months of 2019 are down 6.3 and five per cent respectively. (Wolf Depner/News Staff).

Victoria International Airport leader theorizes speculation tax led to decline in passenger numbers

CEO Geoff Dickson says tensions with Alberta also a factor, more study needed on the issue

The president and chief executive officer of the Victoria International Airports has theorized that tensions between Alberta and British Columbia might have contributed to a recent decline in passenger numbers.

“The other thing that we find is that the economies of Alberta and British Columbia are closely tied, and I’m not sure British Columbia has made Albertans feel welcome,” said Geoff Dickson. “The other thing we are trying to understand more clearly is what is the numbers of Albertans who have sold their houses, or in the process of selling their houses, in Victoria as a result of the speculation tax.”

Dickson said a single secondary home can drive several trips between Alberta and British Columbia as owners check in on their property. “Again, these are just theories on our part,” he said. “We are needing to do a bit more analysis to try to understand this issue, but just intellectually, it can’t be particularly good for air transportation growth here.”

Dickson made these comments after numbers showed a drop in flights and passengers who take them coming in and out of Victoria International Airport.

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In August 2019, the airport handled 10,047 what it calls total aircraft movements and 191,436 passengers. These figures are down 11.5 and 10.9 per cent respectively. The volume of air traffic cargo rose 9.3 per cent. Looking at the bigger picture, total aircraft movements (77,562) are down 6.3 per cent through the first eight months of 2019 compared to the same period in 2018, with total passenger numbers (1,311,308) down five per cent compared to same period in 2018.

Breaking down the numbers, they show domestic traffic — which accounts for about 80 per cent — down about three per cent. “Probably the biggest thing to say is, the market that got hit the hardest would be the Edmonton market,” Dickson said. Last summer, three airlines offered a total of eight daily flights serving the route, he said. “This summer, there were three flights a day, only operated by WestJet. That’s a statement, and that is where we have noticed the biggest decline.”

Traffic to the United States — which accounts for 13 per cent of traffic — is down 15 per cent, or about two per cent of the total drop. “We see it in a number of places,” he said.

Looking at other reasons for the drop, Dickson said include the grounding of the Boeing 737 Max by authorities following two deadly crashes involving the aircraft.

“That has had a ripple effect through the industry, to the point, where we have seen the major carriers downsize capacity and re-deploy,” he said. “For example, we have had a Boeing 767 aircraft scheduled to come in from Toronto service this summer and that [plane] was re-deployed to another route to help fill in for the loss of the Boeing 737 Max. So we got a smaller aircraft.”

The loss of non-stop service to Seattle (by Delta) and San Francisco (United Airlines) also impacted overall number, he said. “Certainly, people can still get to those markets, either through Alaska Airlines or through other Canadian hubs, but whenever there is non-stop service, there just a natural propensity for people to travel more,” he said.

RELATED:Victoria International Airport is one of two in the country operating debt free

Geo-political tensions between China on one hand and the United States and Canada on the other hand might have also played a part, he said.

“It’s really difficult to quantify, and I haven’t look closely at the Chinese in-bound arrival market to either Canada or British Columbia, but whenever there are issues, there is typically a correlation in travel between those respective markets,” he said. “At this stage, I would just be putting that out there as a high level assumption without diving into any analysis on it.”

All this said, this recent dip might end up just being a temporary drop in what has otherwise been a historic period of growth, perhaps best exemplified by the recent opening of the first phase of a $19.4 million expansion of the lower passenger departure lounge.

Victoria International Airport ranks the 11th busiest airport in Canada with over 2 million passengers per year and next summer will see the airport add more capacity.

“We are going to see more frequency on [the route Victoria to Montreal], and we are just working with some of the carriers now, who have some ideas about increasing capacity,” said Dickson. “So I think in the long run, you will continue to see growth. I see this more as a temporary step back.” Notwithstanding any immediate economic and political fluctuations, Dickson sees a bright future ahead. “When we look at it over the medium and long-term, we see fairly robust growth here.”



nick.murray@peninsulanewsreview.com

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wolfgang.depner@peninsulanewsreview.com

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