Air Canada to add new Vancouver-Tokyo flight

Air Canada is taking advantage of the expansion of Tokyo’s Haneda Airport, preparing to add a daily non-stop flight from Vancouver to Japan’s capital, part of the carrier’s Asia-Pacific growth strategy to plump up profit.

The new Vancouver-Haneda route will begin Jan. 29, complementing Air Canada’s current daily service between Vancouver and Tokyo’s Narita International Airport. Connections to partner airlines are available to fly to places such as Bangkok and Singapore.

Air Canada has been heartened by its existing transpacific routes, which helped the carrier’s third-quarter operating profit jump nearly five-fold to $327-million, with a boost in leisure and business-class travellers. Revenue climbed 13.3 per cent during the hectic July-to-September travel period, aided by the smarter deployment of planes. UBS Securities Canada Inc. analyst Tasneem Azim said the airline is showing improvements in revenue per available seat mile, or RASM, a key industry measure of unit revenue.

Overall traffic increased 9.7 per cent in the third quarter, and the momentum carried into October. Traffic on the carrier’s routes between Canada and the Asia-Pacific region surged 25.1 per cent last month to 838 million revenue passenger miles, compared with the same period in 2009.

Total October traffic rose an average of 9.3 per cent to 4.2 billion revenue passenger miles, as consumers returned to the skies after last year’s recession. Air Canada’s load factor, or the proportion of seats filled by paying customers, climbed last month to 80.3 per cent from 79.6 per cent.

In Tokyo on Thursday, B.C. Transportation Minister Shirley Bond said Air Canada’s Vancouver-Haneda route will raise the profile of Vancouver International Airport. She set an ambitious target to boost total traffic going through the Vancouver airport to 28.4 million passengers in 2020, or a 75-per-cent surge from 2009.

Air Canada chief commercial officer Ben Smith said he’s keen on doubling the number of Vancouver-Tokyo flights in January. “We are looking forward to launching our newest Asia route in early 2011, giving consumers more choice when flying between Japan and Canada, showing Air Canada’s commitment to the growth of international air services through our hubs,” Mr. Smith said in a statement. Air Canada also provides daily non-stop flights between Toronto and Narita, and has service three times a week on the Calgary-Narita route.

Air Canada CEO Calin Rovinescu said new international routes are performing well, especially as the carrier strengthens its Canadian hubs, nurtures its partnerships with foreign carriers and controls costs. Air Canada shares have skyrocketed from a low of 73 cents since Mr. Rovinescu took over as CEO on April 1, 2009, when the company was mired in a cash crisis that took months to navigate, avoiding bankruptcy protection.

As part of labour and pension talks last year, five unions received a total of 17.6 million Air Canada shares, now worth $68-million, or a 6.3-per-cent equity stake in the carrier. Those shares are held in a trust for the benefit of unionized workers, with any proceeds earmarked for reducing the airline’s pension deficit.

Montreal-based Air Canada’s third-quarter profit slipped 5.8 per cent to $261-million from $277-million, but there were foreign-exchange gains of $295-million in the same period of 2009. National Bank Financial Inc. analyst Cameron Doerksen noted that the airline’s adjusted share profit of 64 cents in the third quarter exceeded his expectations of 40 cents.