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Roots Air accuses Air Canada of advance predatory pricing

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Date: Friday Mar. 9, 2001 7:07 AM ET

TORONTO - Already accused this week of price-gouging as well as offering unfairly low fares, Air Canada is under attack from an airline that has yet to get off the ground.

Roots Air said Thursday it has filed a complaint with the federal Competition Bureau, accusing Canada's dominant airline of predatory pricing on two major routes that Roots Air plans to start using this month. The new discount carrier wants the competition commissioner to hold an inquiry and order new fare schedules for Toronto-Calgary and Toronto-Vancouver flights.

Air Canada's new three-day advance fare between Toronto and Calgary was dropped to $909 while the fare to Edmonton, where Roots Air won't be flying, remains at $1,903, the low-cost airline said.

And the three-day $999 advance fare for Toronto-Vancouver compares with $1,388 for Winnipeg-Vancouver.

There is no other imaginable reason for dropping these fares other than to deliberately strike at a new, service-oriented player that's a real threat to their market dominance,' said Ted Shetzen, Roots Air's executive vice-president and chief commercial officer.

Roots Air, operated by Skyservice Airlines, has also accused Air Canada of stalling tactics on granting Roots Air passengers access to Aeroplan frequent flyer points.

Responding to the complaint about fares, Calin Rovinescu, an Air Canada executive vice-president, said in a release:

The notion that Air Canada is engaging in predatory behaviour by offering an economy fare with restrictive conditions between Toronto and Vancouver at $999 defies common sense - this type of posturing cannot be taken seriously.

Air Canada has been taking plenty of flak from federal agencies over its air fares on regional routes - for either charging too much or too little.

The Canadian Transportation Agency said Wednesday that the lowest return fare - about $400 - offered by Air Canada on its service between Prince Rupert, B.C., and Vancouver in early August was about double the ticket price on a route of similar distance. The agency ordered Air Canada to cut the fare.

But Air Canada said a price cut would undercut the fares offered by a competing airline, contradicting the position taken earlier this week by the Competition Bureau. It has 10 days to appeal the order.

The bureau also wants to take Air Canada before the Competition Tribunal over allegations of predatory pricing against low-fare competitors CanJet and WestJet on seven routes in Eastern Canada.

In late February, the bureau forced Air Canada to drop some of its cut-rate fares on eastern routes after CanJet complained.

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