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Yahoo
29-05-2025
- Business
- Yahoo
Varcoe: U.S. air travel demand 'has not recovered' yet from Canadians cancelling trips south, says WestJet CEO
The temperature surrounding trade tensions between Canada and the United States may have been lowered, slightly, in recent weeks with less '51st state' talk from President Donald Trump — but Canadian travellers don't seem to be in a forgiving mood. At least, not yet. Since the beginning of February, demand for air travel to the U.S. has dropped significantly and 'it has not recovered since,' WestJet CEO Alexis von Hoensbroech said this week. 'There are some markets that are picking up a bit, but I think it's still early days,' von Hoensbroech told reporters Tuesday after speaking to the Calgary Chamber of Commerce. 'So it's not a change in trend up to this moment.' The head of the country's second-largest airline delivered an address about the state of the company — and Canada's airline industry — to the local business group, discussing the challenges, opportunities and major developments ahead. That included WestJet officially completing its integration of Sunwing Airlines on Wednesday, two years after the acquisition was initially announced. One of the broader issues facing the entire airline sector is the phenomenon of Canadians cancelling holiday plans, or simply opting to not book spring and summer trips into the United States. WestJet suspends nine U.S. routes as Canadians fly elsewhere 'U.S. tourism is going to lose out': Calgarians looking elsewhere to travel this year The trend began earlier this year after Trump imposed tariffs on Canada and Mexico — and, later, other countries — and it was exacerbated by the president's repeated talk about Canada becoming a U.S. state. 'When all the rhetoric started around 51st state and tariffs and so on, we could see in our bookings how angry Canadians became,' von Hoensbroech told the audience. 'We saw that literally . . . thousands of Canadians that had their vacations booked or planned into Florida and California, thought, 'Ahh, maybe Jamaica and Mexico are also nice sun destinations.' So they cancelled those, which was a short-term issue for us. 'We then shifted our own flights from Florida into the Caribbean, and from California and Arizona into Mexico . . . However, it's not net neutral. So we did see a significant impact in our business.' Canadians booked air travel to other countries, but it did have an impact, he added. 'If I just look into how our next couple of months are booked, then I see sort of mid-to-high teens (percentage) less bookings than there were a year ago,' he said after the speech. The phenomenon of Canadians opting not to travel to the U.S. has been showing up in cross-border travel statistics for several months. The country's largest airline, Air Canada, reported earlier this month that it was seeing booking on transborder markets drop by low teens percentage points, on average, for the following six months. In April, return trips by Canadians by air fell 20 per cent compared with the same month a year earlier, according to Statistics Canada preliminary figures. Return trips by automobile plunged 35 per cent — the fourth straight month of year-over-year declines in both categories. A research note by ATB Economics on Wednesday pointed out the number of Canadians returning from south of the border through the Calgary and Edmonton airports dropped 5.6 per cent during the first four months of 2025 from year-earlier levels. And it's not just Canadian flyers showing their displeasure with the trade war by shifting their travel patterns. Through April, the number of Canadians returning from the U.S. by both air and road fell 22 per cent, and for Alberta, it decreased eight per cent from the same period last year, said ATB deputy chief economist Rob Roach. The trade conflict will lead to more Albertans travelling to other countries outside the U.S., but it will also likely see more consumers taking vacations and spending their tourism dollars inside the country, Roach said in an interview. 'I do think it's a temporary thing, but it will last and go (on) as long as the trade war is hot,' he said Wednesday. 'They are still tariffs and we are one tweet away — or Truth Social post away — from this blowing up again. So, until there's a sense that things are back to normal, I think we'll see this reflected in the actual numbers.' After Prime Minister Mark Carney met with Trump in Washington earlier this month, the annexation discussion subsided from the White House. However, the U.S. president mentioned it again on social media Tuesday, saying Canada could join his country's Golden Dome defence system for $61 billion but it would cost 'ZERO DOLLARS if they become our cherished 51st state. They are considering our offer!' How long could a travel boycott continue? 'We do assume that at some point in time, there will be some kind of agreement, hopefully,' von Hoensbroech added. 'What we have seen in the past in our industry is that whenever there's a change in demand pattern for political reasons, it's usually transitional, and long-term demand trends usually flow back.' Susan Bell, a senior vice-president with consultancy Rystad Energy, said the decline in travel to the U.S. isn't just coming from Canada, but also from fewer travellers coming from other countries — and it's showing up in less jet fuel demand. About 20 per cent of U.S. aviation fuel demand is typically tied to international flights. 'Foreign travel into the U.S. has dropped dramatically,' Bell said at a Rystad conference in Calgary on Wednesday. 'Europeans are not travelling to the U.S. People from Mexico are not travelling to the U.S., and that is really impacting international jet fuel demand in the U.S.' Chris Varcoe is a Calgary Herald columnist. cvarcoe@
Canada Standard
26-05-2025
- Business
- Canada Standard
Canada's New Energy Minister Tells Oil and Gas Execs It's Time for Some Quick Wins
Canada's new energy minister walked into the lion's den last week and spoke to oil and gas executives in Calgary about Ottawa's plans to turn the country into an energy superpower. "I'm not here to waste your time," Tim Hodgson told an event at the Calgary Chamber of Commerce May 23, reports The Canadian Press. Hodgson said it's time for a reset and that major projects need to get done in a more timely manner. He said the federal government will have a single body in charge of approving all major projects in two years. "No more five-year reviews. Decisions will come in two years for all projects. This is not a time for half measures or slow steps," he said. "Canada will no longer be defined by delay. We will be defined by delivery." Related: 95-Metre 'Mega-Banner' Urges Carney to Pick a Path, Choose Renewables and Climate Action Hodgson said there are two types of projects: large ones that are in the national interest and may take longer to complete and others that could happen sooner. "There are common projects that we can identify which will be quick wins," he said. "I think we were elected to show some quick wins." The minister had plans to meet with his Alberta counterpart, Brian Jean. He also sat down with Saskatchewan deputy premier Jim Reiter. Some oil executives said Hodgson's comments are encouraging, but only time will tell if they come to fruition. "There's a lot of cautious optimism in the room," said Craig Watt, vice-president of operations for Enserva, a national association representing energy companies. "I think we have some hope at the moment, but we're going to be watching to make sure the minister and the government lives up to what they're promising." Alberta Minister of Indigenous Relations Rajan Sawhney said she was encouraged after hearing the speech. "That Canada needs to be a superpower in terms of conventional and clean energy and the fact that we're looking at accelerated timelines is also very encouraging. Looking forward to a productive working relationship," she said. Mark Scholz, president and CEO of the Canadian Association of Energy Contractors, said he was also impressed. "Our workers matter. And the fact (Hodgson) came out and said the oil and gas sector is an absolutely critical part of the Canadian economy ... these are very encouraging statements," he said. "At the end of the day, we're willing to work with the government. "We want to see big projects built." This report by The Canadian Press was first published May 23, 2025. Source: The Energy Mix
Hamilton Spectator
24-05-2025
- Business
- Hamilton Spectator
Minister says Canada needs ‘infrastructure that gets our energy to tidewater' at Calgary meeting
Canada's new energy and natural resources minister championed the energy sector Friday, calling on governments and industry to work together to build the Pathways Alliance's proposed carbon capture project. In a keynote speech to the Calgary Chamber of Commerce, Tim Hodgson pitched his government's vision of Canada as an energy superpower — exporting oil and gas to the world for decades to come — and pledged to be a voice for Alberta and Western Canada at the cabinet table. 'We need infrastructure that gets our energy to tidewater and to trusted allies — diversifying beyond the US,' he said. To do this, the federal government will fast-track approvals of projects in the 'national interest' with Prime Minister Mark Carney's promised policy of 'one project, one review,' less red tape and more certainty, Hodgson said. 'I think he was trying to set a tone that says, 'We're going to change the system',' said Richard Masson, an executive fellow at the University of Calgary's School of Public Policy and the former CEO of the Alberta Petroleum Marketing Commission Masson said Hodgson's speech signalled that the government is 'going to focus on getting things done and make it more attractive for private-sector development and investment.' Alberta Premier Danielle Smith has been relentless in her calls for the federal government to abandon its proposed regulations to cap oil and gas sector emissions and scrap the Impact Assessment Act, among other environment and climate policies. Carney recently opened the door to making changes to these key policies to move projects forward. Hodgson's speech doesn't reference these two policies by name but leaves that question open, said Masson and Martin Olszynski, an associate professor and chair in energy, resources and sustainability at the University of Calgary. Oil and gas is the country's largest emitting economic sector and the draft regulations would require oil and gas companies to cut emissions by 35 per cent below 2019 levels by 2030. 'He didn't explicitly say what he was going to do, but I think there is … a recognition that some of this stuff has to change or they won't achieve their objectives,' Masson said, referring to the goal of reducing emissions and exporting energy. To Olszynski, Hodgson's speech suggests 'a willingness to discuss and even adjust current policies … but it will be backstopped with an intention to still meet some of those goals.' Hodgson, in his speech, placed particular emphasis on the $16.5-billion Pathways Alliance project to capture carbon dioxide from 13 oilsands sites in northern Alberta and send it to an underground storage site south of Cold Lake through 600 kilometres of pipeline. 'We will invest in carbon capture, methane reduction and other technologies to ensure Canadian oil and gas is not only produced responsibly, but is the most competitive in the world,' Hodgson said. 'This government will not be a government of talk, but a government of action. We need the same from the province of Alberta and the Pathways Alliance.' The Pathways project is undergoing regulatory reviews for over 100 different segments, but on the business side, the project is still awaiting a final investment decision. A global think tank, the international Institute for Energy Economics and Financial Analysis, found the project's business model is shaky . Masson said the federal government has a lot of work to do to establish certainty for investors. The potential for a cap on oil- and gas-sector emissions and uncertainty around carbon credits would 'complicate everything to the point where nobody would be willing to invest.' 'It's going to take getting everybody in a room and sorting out where the real barriers are,' Masson said. According to Hodgson's speech, his government is ready to do the work to create certainty and turn Canada into an energy superpower, but needs a willing partner. 'We need to demonstrate to our customers outside the US, and to our fellow Canadians, that we are a responsible industry — and this government believes Pathways is critical to that reality,' Hodgson said. Hodgson played up his Western roots and business background for the oil and gas crowd, particularly his time as a board member at MEG Energy, and at Goldman Sachs, where he brokered the Alliance Pipeline deal to move natural gas from northwestern Alberta and northeastern British Columbia to the American midwest. He also pointed to his time as board chair of Hydro One and belief that Canada's future depends on integrated electricity grids. 'Our new government will quickly work with provinces and territories on east-west transmission and better integrate our systems,' Hodgson said, adding this is part of Carney's stated goal of creating one economy, not 13. This idea of an east-west transmission grid is a clear priority for the federal government and a big deal, both in terms of energy security and decarbonization goals, Olszynski said. 'A lot of people are waiting with bated breath to figure out what's the direction this government is going to go in,' Olszynski said. 'We're starting to see the contours of that here … I'll be watching to see how the province responds and how industry responds now.'
Edmonton Journal
24-05-2025
- Business
- Edmonton Journal
Varcoe: Ottawa's new resources minister promises clean slate, but oilpatch looks for 'concrete actions' on new projects
Article content 'I want to be very clear. In the new economy we are building — Canada will no longer be defined by delay. We will be defined by delivery,' Hodgson told the Calgary Chamber of Commerce audience — twice, in case anyone missed it the first time. 'Energy is Canada's superpower. It gives us an opportunity to build the strongest economy in the G7.' It was a stark contrast to the general indifference, or active hostility, that seeped out of the pores of the Trudeau government, which had little desire to see Canada significantly boost oil and gas output or build export infrastructure.
Hamilton Spectator
24-05-2025
- Business
- Hamilton Spectator
New federal energy minister tells oil and gas execs it's time for some quick wins
CALGARY - Canada's new energy minister walked into the lion's den Friday and spoke to oil and gas executives in Calgary about Ottawa's plans to turn the country into an energy superpower. 'I'm not here to waste your time,' Tim Hodgson told an event at the Calgary Chamber of Commerce. Hodgson said it's time for a reset and that major projects need to get done in a more timely manner. He said the federal government will have a single body in charge of approving all major projects in two years. 'No more five-year reviews. Decisions will come in two years for all projects. This is not a time for half measures or slow steps,' he said. 'Canada will no longer be defined by delay. We will be defined by delivery.' Hodgson said there are two types of projects: large ones that are in the national interest and may take longer to complete and others that could happen sooner. 'There are common projects that we can identify which will be quick wins,' he said. 'I think we were elected to show some quick wins.' The minister was planning to meet later Friday with his Alberta counterpart, Brian Jean. He also sat down Thursday with Saskatchewan deputy premier Jim Reiter. Some oil executives said Hodgson's comments are encouraging, but only time will tell if they come to fruition. 'There's a lot of cautious optimism in the room,' said Craig Watt, vice-president of operations for Enserva, a national association representing energy companies. 'I think we have some hope at the moment, but we're going to be watching to make sure the minister and the government lives up to what they're promising.' Alberta Minister of Indigenous Relations Rajan Sawhney said she was encouraged after hearing the speech. 'That Canada needs to be a superpower in terms of conventional and clean energy and the fact that we're looking at accelerated timelines is also very encouraging. Looking forward to a productive working relationship,' she said. Mark Scholz, president and CEO of the Canadian Association of Energy Contractors, said he was also impressed. 'Our workers matter. And the fact (Hodgson) came out and said the oil and gas sector is an absolutely critical part of the Canadian economy ... these are very encouraging statements,' he said. 'At the end of the day, we're willing to work with the government. 'We want to see big projects built.' This report by The Canadian Press was first published May 23, 2025.
