15 April 2006
Porter Airlines preps for takeoff
Fall launch planned, but licence is lacking

TORONTO, April 15, 2006 /Globe and Mail/ - Porter Airlines hasn't even applied for a licence to operate yet, but the upstart Toronto commuter carrier is unleashing a marketing blitz to woo business travellers in Canada's largest city.

The fledgling airline is busy planning for a fall launch after assembling a management team that's led by aviation entrepreneur Robert Deluce and his two sons.

Porter will unveil its website on Monday at flyporter.com, promoting plans to initially use 10 Bombardier 70-seat Q400 turboprops for short-haul and medium-haul flights, geared toward the corporate crowd.

The goal is to carve a niche by using Toronto City Centre Airport as its downtown base for flights to Canadian and U.S. destinations that are located within 500 nautical miles or 90 minutes by plane.

Porter is partly owned by privately held Regco Holdings Inc., whose chief executive officer is Mr. Deluce. He is a former co-owner of Air Ontario, which is now part of Air Canada Jazz.

"We have selected 17 cities, and we're hiring pilots and flight attendants," Mr. Deluce said in an interview. "We're targeting a September start. There will be leather seats and good legroom."

The airline's 18-member executive team includes Mr. Deluce's sons, Michael and Jason. Donald Carty, the former CEO at American Airlines, is Regco's chairman.

Other key Porter leaders include chief operating officer James Morrison, a former Air Ontario executive, and maintenance and engineering director Richard Hill, a former Jazz manager.

While the carrier has submitted interim applications to regulators, it won't be allowed to sell any tickets or promote specific destinations until it obtains a licence.

"Porter needs a licence first. Any air carrier needs one, but Porter hasn't filed an official or formal application yet," said Jadrino Huot, a spokesman for the Canadian Transportation Agency.

Desjardins Securities said the new entrant could find it difficult to attract business passengers on proposed flights to smaller Ontario cities such as Sault Ste. Marie.

Flights may also be offered to major centres such as Ottawa, Montreal, New York, Chicago, Boston, Washington and Philadelphia.

The Deluce family's Regco controls the airline along with two investors, private equity firm EdgeStone Capital Partners and Borealis Infrastructure Management Inc. Toronto-based investment firm Borealis is wholly owned by the Ontario Municipal Employees Retirement Board.

Last month, Air Canada Jazz filed a court application that accuses the Toronto Port Authority of helping Porter shut Jazz out of Toronto City Centre Airport, violating the Competition Act.

Jazz argues there should be a judicial review of the authority's recent actions that allegedly gave Porter "a monopoly or dominant position" at the island airport.

The Federal Court application seeks to compel the authority to provide Jazz with backup space near the terminal, which is undergoing renovations to prepare for Porter's launch this fall. The authority denies that it has treated Jazz unfairly.

Jazz suspended scheduled flights at the airport on March 1.

A residents group called Community Air, which opposes expansion at the island airport, wrote a letter last month to federal Transport Minister Lawrence Cannon, urging him to embrace a "rejuvenated waterfront" instead of having Ottawa clear the way for Porter to take flight.

Community Air is also seeking a judicial review and argues any new operation must undergo a federal environmental assessment.

BRENT JANG, TRANSPORTATION REPORTER