Friday, August 3, 2018

Aeroplan rejects Air Canada's bid, partners with Porter Airlines and is in talks with oneworld

Yesterday was the deadline for Aimia (the parent company of Aeroplan) to make a decision on the proposed takeover of Aeroplan by Air Canada, CIBC, TD & Visa. For the most part of the day it was quiet on the front of whether the bid would be accepted or rejected by Aimia. We finally got news just before 9pm Eastern that the bid was rejected. According to the press release from the Air Canada consortium they had been in talks with Aeroplan and actually sweetened the pot but in the end Aimia said no.

There were hints this would be the case as the day prior, on August 1st, it was revealed that Aimia was in talks with the oneworld alliance which consists of 13 airlines and several other partner airlines included American Airlines, British Airways and Cathay Pacific.  This potential partnership actually makes a lot of sense for both parties - Aeroplan would get access earn and burn access that its members would be accustomed to albeit with a different alliance and oneworld would get access to more Canadian consumers which they need as they are behind Star Alliance and SkyTeam in terms of presence in Canada.

And now today we get the biggest confirmed Aeroplan news yet that continues to show that Aeroplan wants to remain independent and that is they have officially partnered with Porter Airlines, Canada's third largest airline. Aeroplan will essentially become Porter's currency:
"...a comprehensive partnership designating Porter as a preferred Canadian airline to issue Aeroplan Miles on Porter routes effective July 2020. Porter will also become a redemption partner, as of the effective time of the agreement, offering up to 60% of seat inventory for the purchase of flights with Aeroplan Miles at fixed-rate prices. The arrangement includes an extensive cooperative marketing program targeting existing Aeroplan members, with an emphasis on members who travel on Porter routes."
You may be asking what happens VIPorter points at that time and the answer is also in the press release that VIPorter points will be converted in Aeroplan miles in July of 2020. Porter Airlines however will keep VIPorter running as their elite recognition program (just like Air Canada Altitude runs separate from Aeroplan) and it will continue to offer their elite members benefits such as priority boarding, complimentary seat selection and checked baggage allowances.

This partnership is great news for Aeroplan but it reality it isn't that huge for Aeroplan members as Porter is a relatively small airline flying to 16 cities in Canada (Ontario, Quebec & the Maritimes) and 7 cities in the U.S.. It doesn't mean much for Western Canada unless Porter gets its way to have the runway extended at their home airport (Toronto's Island Airport aka Billy Bishop Toronto City airport) so they can fly Airbus A220 airplanes (nee Bombardier CSeries) on longer routes to cities like Calgary, Edmonton and Vancouver.

It has definitely been another exciting 48 hours in the Air Canada Aeroplan soap opera and as we always remind our readers, you can keep track of it all on our Air Canada Aeroplan resource page.

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