OTTAWA —
Rob Przybylski and Courtney Ross were slated to wrap up the month on a Costa Rican beach, sipping sugarcane cocktails with friends and family as they celebrated their wedding.
Instead, the Oshawa, Ont., duo say they and their 84 guests are out more than $216,000 after their Sunwing Airlines vacation package was cancelled due to the COVID-19 pandemic.
“They have basically told us that refunds are not an option,” said Przybylski, 35.
Like most Canadian airlines, Sunwing does not reimburse passengers for flights cancelled by the airline, instead offering travel vouchers valid for two years.
The couple’s original booking in April had been called off by the carrier as the virus shut down global air travel. Their destination, a Planet Hollywood resort on the Pacific Ocean, offered a refund, but Sunwing did not, he said. So they rebooked the nuptial getaway for Nov. 27.
Sunwing cancelled the second flight last month, he said.
“We have 80 people that are out money, and a lot of them aren’t working now,” including his fiancee for much of this year, Przybylski said.
“My mom is the perfect example. She hasn’t travelled in 30 years. What is she going to do with a credit?”
Despite minuscule travel demand, Canadian airlines continue to schedule tens of thousands of flights per month, only to cancel the vast majority of them several weeks before takeoff.
The approach can leave passengers with a drastically changed itinerary or no flight at all, giving them little choice but to accept vouchers they may never use.
Air Canada cut more than 27,000 flights, or 70 per cent, from its November schedule between Sept. 25 and Oct. 9, according to figures from aviation data firm Cirium. It cut another 2,000 by the end of October.
WestJet, which recently began to offer refunds for cancelled flights, in contrast to its competitors, slashed its November schedule by about 12,400 flights, or 68 per cent, in one week last month. Air Transat scrapped 63 per cent of its flights for November in the same week, leaving it with 123 – down to 100 as of last week.
Comparable schedule cuts occurred in October and September.
“It’s called bait and switch,” said John Gradek, a lecturer at McGill University and head of its Global Aviation Leadership program.
The strategy is a response to a shift in customer behaviour, an attempt to woo wary travellers with ample flight options before drastically undersold seats prompt a scheduling cull.
“The industry cross their fingers and hope people buy, that they all of a sudden get this insane urge to fly,” Gradek said, calling the practice “deceptive.”
“’Cynical’ is probably too light of a word,” he said. “It borders on the edge of misleading advertising, that you’re promoting and offering for sale stuff that you know there’s a high probability will not be what you’re actually offering to the customer.”
Carriers deny there is anything untoward about recent schedule gutting.
“Airline schedules have always been subject to change,” Air Canada spokesman Peter Fitzpatrick said in an email, noting the company has had to cut capacity by more than 90 per cent since March.
“Overall, our schedule continues to operate as planned, and for any customers affected by changes we do provide advance notice and offer options.”
“We do our best to avoid cancelling flights at the last minute,” said Transat spokesman Christophe Hennebelle.
Sunwing and WestJet did not respond immediately to questions.
Transport Minister Marc Garneau called the situation “complicated,” saying he sympathizes with customers.
“I encourage the airlines to repay passengers if they can. At the same time, some of those airlines are in deep difficulty in terms of their own ability to continue to function if they were having to provide refunds to all of the customers.”
Air Canada held on to more than $2.4 billion in advance ticket sales as of July 31, a hefty sum to return after its revenues dropped 95 per cent year over year in its second quarter.
Travellers have a right to reimbursement for a service that was paid for but never rendered, regardless of airlines’ financial woes, say opposition MPs and consumer advocates.
The Conservatives, NDP and Bloc Quebecois have demanded refund requirements as a condition of any aid package to the industry.
Bloc Leader Yves-Francois Blanchet said Friday the government is “behaving like a branch of Air Canada.”
“The minister of transport for seven months, since the beginning of the crisis, has essentially shrugged his shoulders any time the need for passenger reimbursement has come up,” NDP transport critic Niki Ashton said in an interview.
The Canadian Transportation Agency said in March that airlines can issue travel credit instead of refunds for cancelled trips in the “current context,” though the agency later clarified that the online statement was “not a binding decision” and that reimbursements depend in part on the contract between airline and passenger.
European and U.S. authorities have demanded airlines reimburse travellers, on top of the strings attached to aid that range from limiting dividends and executive bonuses to cutting carbon emissions and carving out ownership stakes for government.
Back in Oshawa, far from the sands of a Costa Rican resort, Rob Przybylski took stock.
“I know I’m not the only one in this situation. The biggest thing for me is to get my money back for my guests.”
This report by The Canadian Press was first published Nov. 6, 2020
TOKYO (AP) — Japanese technology group SoftBank swung back to profitability in the July-September quarter, boosted by positive results in its Vision Fund investments.
Tokyo-based SoftBank Group Corp. reported Tuesday a fiscal second quarter profit of nearly 1.18 trillion yen ($7.7 billion), compared with a 931 billion yen loss in the year-earlier period.
Quarterly sales edged up about 6% to nearly 1.77 trillion yen ($11.5 billion).
SoftBank credited income from royalties and licensing related to its holdings in Arm, a computer chip-designing company, whose business spans smartphones, data centers, networking equipment, automotive, consumer electronic devices, and AI applications.
The results were also helped by the absence of losses related to SoftBank’s investment in office-space sharing venture WeWork, which hit the previous fiscal year.
WeWork, which filed for Chapter 11 bankruptcy protection in 2023, emerged from Chapter 11 in June.
SoftBank has benefitted in recent months from rising share prices in some investment, such as U.S.-based e-commerce company Coupang, Chinese mobility provider DiDi Global and Bytedance, the Chinese developer of TikTok.
SoftBank’s financial results tend to swing wildly, partly because of its sprawling investment portfolio that includes search engine Yahoo, Chinese retailer Alibaba, and artificial intelligence company Nvidia.
SoftBank makes investments in a variety of companies that it groups together in a series of Vision Funds.
The company’s founder, Masayoshi Son, is a pioneer in technology investment in Japan. SoftBank Group does not give earnings forecasts.
Shopify Inc. executives brushed off concerns that incoming U.S. President Donald Trump will be a major detriment to many of the company’s merchants.
“There’s nothing in what we’ve heard from Trump, nor would there have been anything from (Democratic candidate) Kamala (Harris), which we think impacts the overall state of new business formation and entrepreneurship,” Shopify’s chief financial officer Jeff Hoffmeister told analysts on a call Tuesday.
“We still feel really good about all the merchants out there, all the entrepreneurs that want to start new businesses and that’s obviously not going to change with the administration.”
Hoffmeister’s comments come a week after Trump, a Republican businessman, trounced Harris in an election that will soon return him to the Oval Office.
On the campaign trail, he threatened to impose tariffs of 60 per cent on imports from China and roughly 10 per cent to 20 per cent on goods from all other countries.
If the president-elect makes good on the promise, many worry the cost of operating will soar for companies, including customers of Shopify, which sells e-commerce software to small businesses but also brands as big as Kylie Cosmetics and Victoria’s Secret.
These merchants may feel they have no choice but to pass on the increases to customers, perhaps sparking more inflation.
If Trump’s tariffs do come to fruition, Shopify’s president Harley Finkelstein pointed out China is “not a huge area” for Shopify.
However, “we can’t anticipate what every presidential administration is going to do,” he cautioned.
He likened the uncertainty facing the business community to the COVID-19 pandemic where Shopify had to help companies migrate online.
“Our job is no matter what comes the way of our merchants, we provide them with tools and service and support for them to navigate it really well,” he said.
Finkelstein was questioned about the forthcoming U.S. leadership change on a call meant to delve into Shopify’s latest earnings, which sent shares soaring 27 per cent to $158.63 shortly after Tuesday’s market open.
The Ottawa-based company, which keeps its books in U.S. dollars, reported US$828 million in net income for its third quarter, up from US$718 million in the same quarter last year, as its revenue rose 26 per cent.
Revenue for the period ended Sept. 30 totalled US$2.16 billion, up from US$1.71 billion a year earlier.
Subscription solutions revenue reached US$610 million, up from US$486 million in the same quarter last year.
Merchant solutions revenue amounted to US$1.55 billion, up from US$1.23 billion.
Shopify’s net income excluding the impact of equity investments totalled US$344 million for the quarter, up from US$173 million in the same quarter last year.
Daniel Chan, a TD Cowen analyst, said the results show Shopify has a leadership position in the e-commerce world and “a continued ability to gain market share.”
In its outlook for its fourth quarter of 2024, the company said it expects revenue to grow at a mid-to-high-twenties percentage rate on a year-over-year basis.
“Q4 guidance suggests Shopify will finish the year strong, with better-than-expected revenue growth and operating margin,” Chan pointed out in a note to investors.
This report by The Canadian Press was first published Nov. 12, 2024.
TORONTO – RioCan Real Estate Investment Trust says it has cut almost 10 per cent of its staff as it deals with a slowdown in the condo market and overall pushes for greater efficiency.
The company says the cuts, which amount to around 60 employees based on its last annual filing, will mean about $9 million in restructuring charges and should translate to about $8 million in annualized cash savings.
The job cuts come as RioCan and others scale back condo development plans as the market softens, but chief executive Jonathan Gitlin says the reductions were from a companywide efficiency effort.
RioCan says it doesn’t plan to start any new construction of mixed-use properties this year and well into 2025 as it adjusts to the shifting market demand.
The company reported a net income of $96.9 million in the third quarter, up from a loss of $73.5 million last year, as it saw a $159 million boost from a favourable change in the fair value of investment properties.
RioCan reported what it says is a record-breaking 97.8 per cent occupancy rate in the quarter including retail committed occupancy of 98.6 per cent.
This report by The Canadian Press was first published Nov. 12, 2024.
