In late 1996 VIA Rail announced that it wanted to increase
summer service on the busy Vancouver-Jasper segment of the
Vancouver-Toronto Canadian to six days a week from three.
This raised strenuous objections from the Great Canadian Railtour
Company, a private company which had taken over VIA's Canadian
Rockies by Daylight service when it was privatised by the
Mulroney government in 1990. While Transport Action Canada and
Transport Action BC firmly felt that approving VIA's planned
service increase was in the best interest of the travelling
public and would improve VIA's financial state without
threatening the viability of GCRC's Rocky Mountaineer, on
February 14, 1997 then Minister of Transport David Anderson
announced that he would deny VIA's request to increase their
service. This page details our communications with the minister
on this issue.
Readers should be aware that a new Minister of Transport was
appointed on June 11, 1997, The Honourable David M. Collenette,
P.C., M.P.
Transport Action BC's November 10, 1996 letter to David
Anderson
November 10, 1996
The Honourable David Anderson
Minster of Transport
House of Commons
Ottawa, Ontario K1P 0A6
Re: Increased VIA Rail service between
Vancouver and Jasper
Dear Mr. Anderson:
We understand that VIA Rail requires your permission to
increase its summer service from three trains per week to six
trains per week on the route of The Canadian between
Vancouver and Jasper. Transport Action BC encourages you to allow
VIA to increase its service, despite the objections of the Great
Canadian Railtour Company (GCRC), for the reasons we provide
below.
VIA currently earns 130 percent of its operating costs on this
route in the summer and is frequently forced to turn away
passengers for lack of capacity; hence the desire to improve the
service and the bottom line by expanding service on this
profitable route. From personal experience within our group, we
know that sleeping car space must be reserved at least two months
ahead of time during the busy summer season. Additional earnings
which VIA gains by increasing service can be used to help offset
losses on other routes, such as the Skeena, and the Malahat
Dayliner on Vancouver Island. VIA must be permitted to find
ways to increase its revenue if it is to reduce its level of
subsidy from $300 million to $170 million over the next couple of
years. Expanding VancouverJasper service is an ideal
opportunity to help achieve this aim.
While the route of The Canadian between Vancouver and
Jasper is the same as that used by GCRC for a section of its Rocky
Mountaineer service, we do not feel that VIA and GCRC are in
direct competition for the same market given the distinctions
between the two products provided. The Rocky Mountaineer
caters almost exclusively to tourists who desire a leisurely trip
allowing them to travel entirely in daylight. This requires a
two-day trip with an overnight hotel stay in Kamloops. The same
trip on VIA is only 18 hours, with the spectacular Fraser and
Thompson River canyons passed through in darkness. VIA also
provides service to intermediate destinations such as Port
Coquitlam, Abbotsford, Chilliwack, Hope, Boston Bar, Ashcroft,
Clearwater, Blue River and Valemont, as well as Kamloops. The Rocky
Mountaineer does not permit boarding and alighting at any of
these communities as it functions solely as a land
cruise. It must also be added that GCRC still provides the
only passenger train service on the more scenic and popular CPR
route via Rogers Pass and Banff.
VIA has also found that it has difficulty accommodating high
levels of through traffic from points east of Jasper to points
west. Expanding service west of Jasper to six days a week should
help ease this constraint.
It is obvious, given that both VIA and GCRC have plans for
expansion, that their market assessments indicate considerable
unsatisfied demand in the VancouverJasper corridor. At
present, the two companies combined are only carrying about
one-third of the traffic which existed before VIAs Western
Canada services were cut drastically in 1990. Studies by the
Alberta Department of Economic Development in 1989 showed there
is a market for a daily regular train from both Edmonton and
Calgary to Vancouver, as well as a three times per week tour and
tourist train like the Rocky Mountaineer. We believe that
this evidence supports our belief that there is room for both VIA
and GCRC to grow and continue to generate profits on this route.
With more capacity will come more tourists, many from out of the
country, and the valuable economic benefit they provide in terms
of spin-off spending. Local reports state that the average
tourist stays for three days and spends $200 each day. On this
basis, additional train passengers could create $40 million in
spin-off benefits to the economy and generate over 1,000 needed
summer jobs in the service sector.
Great Canadians complaints that VIA is a bureaucratic
Crown corporation run amok is simply not supported by the
evidence. Rather, VIA is making a sound business decision which
will help it to continue to provide service to the public while
providing better value for its shareholders, the citizens of
Canada. We strongly encourage you to support VIA in its efforts
to simultaneously improve its service and financial position by
permitting it to expand its summer VancouverJasper service.
Sincerely,
Ian Fisher,
President,
Transport Action BC
David Anderson's December 18, 1996 reply
(note how this letter could be sent to either VIA or GCRC
supporters)
December 18, 1996
Mr. Ian Fisher,
President,
Transport Action BC
Dear Mr. Fisher:
Thank you for your recent letter regarding passenger rail
service on the Jasper to Vancouver portion of the
transcontinental route.
Personally, I believe that the future of rail tourism in
Canada is excellent, Indeed, the prospects for rail tourism over
the next two decades may well be as bright as that which has been
enjoyed by the cruise ship industry on our coast over the past
twenty years. We have a great product with outstanding potential.
I appreciate that you have taken the time to apprise me of
your views on this matter. My officials are currently reviewing
the implications of both VIA's proposal and the material provided
by the Great Canadian Railtour Company (GCRC). Furthermore, as
this issue is commercial in nature, I have met twice with Mr.
Peter Armstrong, President and Chief Executive Officer of GCRC,
and with Mr. Terry Ivany, VIA's President and Chief Executive
Officer, and have asked that they present options to me to
resolve this matter.
I can assure that, in making a decision, I will carefully
consider your views as well as the discussions between Messrs.
Armstrong and Ivany.
Again, thank you for writing.
Yours sincerely,
David Anderson, P.C., M.P.
Transport Action BC's March 10, 1997 letter to David Anderson
March 10, 1997
The Honourable David Anderson
Minister of Transport
House of Commons
Ottawa, Ontario K1P 0A6
Dear Mr Anderson:
I would like the express the disappointment among the
membership of Transport Action BC following your announcement that
VIA Rails request to increase its VancouverJasper
service was rejected.
It is our belief that the services offered by VIA and the
Great Canadian Railtour Company (GCRC) are sufficiently
differentiated that VIAs request should have been approved.
My contacts in the local tour business indicate that they do not
feel that VIA's product is interchangeable with that of GCRC. For
many travellers, GCRC's service is simply too time-consuming to
consider. I have discussed this issue with Mr. Peter Armstrong of
GCRC and Transport Action BC does not agree with his position that
VIA is in direct competition with his company.
In addition, VIAs government-mandated efforts to
increase its cost recovery have been thwarted by the very
government that has claimed that VIA must act in a more
businesslike manner if it wishes to survive. It is ironic that
the press release that accompanied your announcement included the
sentence, "Via has been given a mandate by the federal
government to reduce its operating subsidy while maintaining
services." Expanding VIA's JasperVancouver service
presented an ideal opportunity for VIA to improve its economic
sustainability to help meet this mandate given that VIA projected
being able to recover at least 130 percent of the marginal costs
of operating more frequent service.
Past market analysis and historical evidence indicates that
the market would not suffer a glut of supply if VIA were
permitted to increase its services. Before the Mulroney cuts to
VIA there were 15 trains a week leaving Vancouver to travel
through the Rockies, this summer there will be no more than half
that number. It is unfortunate that a proper market analysis was
apparently not done to evaluate the current situation. What
impact, if any, of VIA's operation of six-day-a-week service in
this corridor in the summer of 1991 should be examined. It has
also been suggested that VIA's proposed increase would only help
to meet the latent demand for through-trips on The Canadian
from points east of Jasper. Currently tour groups book space on
VIA well in advance meaning that individual travellers,
frequently Canadians, are unable to purchase a through ticket.
Since these travellers are then unable to experience the most
scenic part of the trip, it is likely that they choose other
travel modes and so bring the cost recovery of The Canadian
east of Jasper below optimal levels.
This decision and the protracted process leading up to it has
generated a considerable amount of ill will between VIA Rail and
GCRC, as well as causing substantial inconvenience to tour
operators who must plan and promote their products well ahead of
time. Public and political perceptions of this issue were heavily
shaped by the considerable number of misrepresentations made by
GCRC and its allies made in the press. These statements were then
perpetuated by the press as facts, leaving most reports on the
issue a patchwork of half-truths. For example, GCRC certainly did
not appear to do anything to dispel the mistaken impression that
VIA was planning to resume service on the more lucrative CPR
route to Banff when VIA only proposed to increase service on its
existing route. Even the House of Commons Standing Committee on
Transport perpetuates the myths put forward on this issue. In
their report on the seemingly unrelated topic of renewing the
national highway system, they state that the, "private
sector must be protected from government re-entering a market to
compete with the private sector after divesting itself of the
service or infrastructure." Since VIA never ceased to
operate Vancouver-Jasper service since the Rocky Mountaineer
began service, this is highly misleading. As well, VIA's plan to
increase service did not propose any new infrastructure but
rather better use of that which is already in place.
Ideally VIA and GCRC could co-operate in marketing their
services. No doubt there are many travellers who would like to
travel in daylight in one direction and by overnight train in the
other. However, given the current poisoned climate, such
co-operation seems a distant possibility.
In the February 27th issue of the Victoria
Times-Colonist you make a number of comments that suggest
that the future of VIA Rail is not bright. I would agree that
this is the case if reductions in financial support for VIA
continue in combination with government micro-management that
prevents VIA from taking advantage of opportunities to increase
its revenue. As there will be an election in the near future, I
suggest that the government be honest about its plans for VIA
rather than perpetuating current uncertainties. If you have not
already had the opportunity to do so, I would suggest that you
meet with David Glastonbury, president of Transport Action Canada,
to discuss the matter.
Sincerely,
Ian Fisher,
President,
Transport Action BC
David Anderson's May 30, 1997 reply to our letter of March 10
May 30, 1997 (a few days before the federal election)
Mr. Ian Fisher,
President,
Transport Action BC
Dear Mr. Fisher:
Thank you for your letter of March 10, 1997, regarding my
decision with respect to VIA Rail Canada's proposal to increase
the frequency of its service on the Jasper to Vancouver portion
of the transcontinental route. I have noted your views on this
issue.
I can assure you that I carefully considered all of the views
and information I received on this matter prior to deciding not
to authorise VIA to proceed with its plans. In arriving at this
decision, I was particularly concerned about the effect the extra
frequencies would have on the private sector company also serving
this route, especially at a time when this company has already
invested heavily to increase its own capacity.
VIA has made great strides toward being one of the best
passenger rail services in the world, and I am confident that it
will continue on this path.
I trust that you will understand my position. Again, thank you
for writing.
Yours sincerely,
David Anderson, P.C., M.P.
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