Transwest takes aim at competition with free shuttle service

Transwest Airlines quietly launched its free airport shuttle service last week and the company is looking to set itself apart from its competition with this latest offering.

It has also launched itself into a competition with the local taxi industry, which will likely lose business to the shuttle service.

The regional airline put its two shuttle buses into circulation on Nov. 30. The buses are now transporting passengers to and from the Prince Albert Municipal Airport. The route includes three inner-city stops: the Prince Albert Inn, the Quality Inn and Spruce Lodge. In its market analysis, Transwest found that these locations were where many of their passengers were heading.

“Basically, we just wanted to provide a better service for our clients,” said Garrett Lawless, chief operating officer.

He added unlike other industries, the aviation industry has very narrow profit margins. “So, it’s difficult to differentiate yourself from the competition by offering lower prices, because most operators sell their fares as low as they can afford to sell them.”

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To be competitive in this market, operators need to find other efficient and effective ways to offer a better service for the same price to their customers, he said.

“Getting a shuttle service that can only be offered for free is difficult to put into the company’s finances, because profit margins are so tight,” he said. To offset the cost of the free service, the airline refurbished the used buses using its new aircraft-painting business.

“By doing that we were able to save a lot of money and then fit this free service into our current operating budget,” Lawless said.

Profit margins in the industry are small because competition is fierce, he said. Transwest’s direct competitor is Pronto Airways, which is affiliated with Westwind Aviation. And Transwest is looking to set itself apart from Pronto with the shuttle service.

The airline is now also providing competition to Prince Albert’s taxi companies. The companies each charge a flat rate to fares going to Prince Albert’s airport.

Russ McCloy, the owner and manager of Checker Taxi, questioned whether the Transwest shuttle is truly free for airline passengers. To him, it doesn’t make sense that anyone would take passengers back and forth, to and from the airport, for free. He feels there is a hidden cost to customers.

“I don’t see any advantage to Transwest to be running a free service if they weren’t being paid for it because those customers are going to ride with them whether they get a free ride or whether they have to pay for the ride,” he said.

McCloy called the move by Transwest “nothing more than an attack on the taxi industry.” He said there’s no question this will hurt his business.

“We have airport business that they’re taking, so of course it’s going to hurt our business.”

Checker charges a base of $19 from downtown Prince Albert to the airport.

McCloy has asked Prince Albert’s bylaw department to look into the legality of Transwest’s new shuttle service. He asked them to also look into whether Transwest is doing direct taxi business – as in taking payment. If the airline were to take payment for the service, McCloy said it would require a taxi licence.

“All I can do is request that the powers that be make sure that things are done correctly. Other than that, there’s no other way to compete with them.”

But Transwest doesn’t see the taxis as a competitor – it sees its competition as Pronto. Lawless said Pronto is its main competition for passenger service, and Pronto hasn’t said anything in response to the shuttle service’s launch.

He acknowledged the taxi companies will see Transwest as a competitor because the taxis charge customers for a service the airline is offering for free.

“It’s hard to compete with somebody that’s offering a free service,” Lawless said. “But we haven’t received any complaints or anything like that so far. I mean, it’s business, is what it really comes down to.”

The move is something the airline has been planning to do for the last three years, Lawless said. Their shuttles operate on a schedule and those schedules are available at the three pick-up/drop-off locations in the city.

The buses, driven by Transwest’s ground crew, can carry up to 15 people. It’s an added duty for the crew that’s responsible for de-icing, fuelling, loading and unloading the planes.

The buses are also accessible, which was a feature needed because of the significant number of passengers who use wheelchairs and are going to Prince Albert for medical care. This fact also played into the chosen stops for the shuttle buses.

Spruce Lodge was probably the most important location to have the shuttles service, Lawless said. Spruce Lodge accommodates people who live far outside of the city and need to use health services in Prince Albert.

Transwest is looking at launching a shuttle bus service La Ronge next.

tjames@panow.com

On Twitter: @thiajames