About This Episode

In this episode of “The Jump Seat,” host Chris Glass takes listeners on location to the Abbotsford Airport, where he sits down with Parm Sidhu, the airport’s General Manager. Parm shares his incredible journey from a Zamboni driver to the helm of one of Canada’s fastest-growing airports. The conversation delves into the unique aspects of Abbotsford Airport, including its history, growth, and innovative approach to becoming an ultra low-cost airport. Parm discusses the airport’s early days, the impact of WestJet, and how Abbotsford has adapted to changes in the aviation industry over the years. Listeners will gain insights into the importance of partnerships, the influence of technology, and how the airport plans to handle future growth without expanding its physical footprint.  Join Chris and Parm for a deep dive into the strategies and innovations that are driving Abbotsford Airport’s success and learn how this dynamic airport is setting new standards in the aviation industry..

Podcast Transcript

Chris Glass: 00:00 Welcome back to another exciting episode of the Jump Seat. Today we are on location here at the Abbotsford Airport with I’m Parm Sidhu, the airport general manager. Parm Sidhu: 00:10 Thanks for having me today, chris. Chris Glass: 00:12 Perfect. Thank you so much for hosting us. This has been such a great trip, learning about the airport and learning about the city here. Thank you for the good weather. Thank you for the view. That is a much better view than we’re used to in the studio. Parm Sidhu: 00:27 You’re welcome. This is one of the most livable areas in North America and it’s a vibrant economy and we got a lot to offer. Chris Glass: 00:33 So I think it would be great to start with you and your story, so tell me a bit about Parham and how you ended up becoming the general manager of the airport here. Parm Sidhu: 00:42 That’s a complicated story but I grew up in Abbotsford, played rugby in Abbotsford and I was pretty good in rugby and I got the rugby club. I joined the rugby club after high school and they kind of influenced me to get a job with the City of Abbotsford. So I started with the city as a skate sharpener and a Zamboni driver in the early 90s and did that for many, many years, worked at Public Works Yard the city’s been a great employer and I’ve never left and then we took over the airport as a city in 1997. Okay, and then a position came up around 2001, and it was for a groundskeeper and basically my first job was keeping the cigarettes off the sidewalk, keeping carpet shampooed in the terminal, keeping the windows clean and plowing snow and keeping the maintaining of the airfield. Chris Glass: 01:35 Wow, okay, so you start out there. And then how did that grow into the GM role? Parm Sidhu: 01:40 Well, it took a lot of, you know, a willing employer, a willing employee, and it was a partnership and a collaboration of getting to understand the industry. As soon as I got here on the first day of walking in, I knew I wanted to be in aviation and I started going back to school. I went to BCIT, took some airport operations courses, ended up with a certificate from there, but the on-the-job training was so powerful. You had a rapid-growing Airport with limited amounts of staff and lots of different things going on that grew from there into different roles and various different roles. Chris Glass: 02:15 I think seven or eight different positions I’ve held here, so that time that you just described, that, that late 90s, was such a heavy growth period for the airlines. You know. You know, taking on the airline I was with, we took on 10 extra aircraft during that time and you know, doubling and tripling the staff. What was it like for airports at that time? Was it the same kind of growth? Parm Sidhu: 02:36 Well, yeah, for, especially for in 1996 we had 3 000 passengers right and our biggest revenue source as an airport was raspberries by line item right. So the City of Abbotsford assumed operations of the airport January 1st of 1997 and shortly thereafter an airline called WestJet said they wanted to service this marketplace Right, and we didn’t have a terminal. Maintenance garage was turned into a terminal and then the terminal you see today broke ground for $60 a square foot and we didn’t have parking lots, we didn’t have aprons, so we weren’t a complete greenfield, but there was a lot of developments happening. Chris Glass: 03:14 Off camera. We were talking about kind of how Abbotsford is a bit unique in the way it’s set up, so can you walk me through how I guess airports were deregulated and how Abbotsford is kind of a stand-alone in that world? Parm Sidhu: 03:29 Yeah, so under the devolution of airports we didn’t have the volume, so we didn’t make the national airports policy cut. So we are an independent airport and we were basically transferred to the City of Abbotsford. City of Abbotsford formed an airport authority reporting to City Council, and gave the authority, who was the entrepreneurs of the community, a mandate. You’re all. The airport can’t cost the taxpayers any money and you have limited boring powers and we want you to go to the airport. From there the story and the journey began. Chris Glass: 04:02 Wow. So what’s the structure currently? Now, does Abbotsford still report to City Council, or has that changed? Parm Sidhu: 04:10 Yeah, we still have an airport authority and City Council. Everyone wants the airport to grow, sees aviation aerospace as a catalyst to the regional economy, the larger economy, and these jobs and movement of people and goods are significant to the region and to the country. Chris Glass: 04:28 One of the things that I really like that you keep saying and I picked it up and you’ve coined this phrase that Abbotsford is the ultra low-cost airport. I’ve heard of ultra low-cost airlines, but ultra low-cost airport. So what’s the genesis of that and what does that mean? Parm Sidhu: 04:46 Well, if you looked at what happened in 97, we didn’t have any facilities, so we had to get something to the market because we didn’t know our role. So we got something what we call high value, low cost, operationally efficient to the market and then from there we had free parking. We had a motivated airline in WestJet, wanting to grow the marketplace. They stimulated, not repetitive travelers. They took people out of cars, put them into planes, flew them to Calgary, Edmonton, and we moved the needle from 97 to 2003 fast. You know it went from 3,096 to 97,097. And by 2003, it was just somewhere around 400,000. Wow, and that’s a significant swing in passenger volumes. Parm Sidhu: 05:30 Westjet has changed the look and feel of many airports and we happen to be one of them. Right, but in those days WestJet used to, from 97 to 2003, Some days WestJet would open and close the terminal. So we gave them the keys to the community and the keys to the airport and there was a free parking a reason to come here and low fares. There’s two things that fill planes in my opinion low fares and free parking, and our example from 97 to 2003,. The data don’t lie. It shows rapid growth. And then what? Chris Glass: 06:07 happened in 2003?. Parm Sidhu: 06:09 It was 2004,. We brought in paid parking. We brought in airport improvement fee. You know we had changed the model. The infrastructure was expensive ahead of us. We needed a lot of dollars. We needed longer runways, the terminal needed to be expanded. There was a whole bunch of other regulatory changes coming that come with passenger growth. The funding had to come from somewhere. So we brought in paid parking and our fees were increased. Parm Sidhu: 06:37 Then, around 2008, we did get a visitor from an ultra-low-cost carrier, a global one. They were looking to expand possibly, and they were like we love what you got. It’s a simple operation, fits our model to a tee, but your costs are too high and we’re like going costs are too high. Our costs were relatively low in the system and then it really from there turned into a conversation with WestJet around 2010,. The changes to the CTA and how airlines show all-in fares. We realized there was something there and then we continued to work with our partners in WestJet and Enerjet at the time. And then who was looking to start? And Canada Jet Lines was looking to start. They were looking at Abbotsford and then New Leaf Travel and Flair. It was the pivot point really to an ultra low-cost airport was around 2015. And what did that transition look like? Parm Sidhu: 07:28 We realized, from 2004 to 2015, the volumes of passenger volumes didn’t really move. The population base had grown, bellingham was taking a lot of cross-border leakage and we’re still hovering around 490, 503, 470, 490, just hovering around the half a million mark. So we tipped and stagnant, tipped above it twice, but everything was below and we went to, formed a partnership with WestJet and you know the new forms of leadership are through partnerships. I believe that’s the only way to move forward is partnerships and collaboration, and we worked with WestJet of the day and WestJet still today. Westjet put us on the map and New Leaf, which is Flair today. And what can we do to basically move the needle on pasture volumes? You know, we do represent the second largest population base in Canada, but our population is growing, but our roots aren’t Right and air travel isn’t yeah. Parm Sidhu: 08:24 And air travel was growing. Yeah, and that’s when we decided, okay, we did a lot of research on ultra low-cost carriers and what was happening around the world. This was around 2012, 13, 14 and we were under the understanding that someone’s going to hit the market. Well, when someone does, our platform will be so competitive that they will have no choice other than to be here To make it happen. Yeah, absolutely. So we went and studied the region, studied the nation, took the pros and cons and then we went into the US, looked at what Bellingham was able to do. Bellingham’s peak year was 1.3 million passengers in 2013, and their primary 700,000 were Canadians. Cross-border leakage. Chris Glass: 09:05 So money going straight to USS carriers, US. Parm Sidhu: 09:08 Yeah, yeah, and some can make the argument. You know, if it wasn’t for Legion Airlines and what they’re doing out of Bellingham, a lot of Canadians would not have a lot of people from this market would not have seen Vegas. Right, those lower fares bring in a different customer and they bring in repetitive travelers because they make it affordable and accessible, right. So we decided to understand the ultra-low-cost carrier space. If you looked at what was happening internationally with Ryanair, allegiant Airlines, some of the most profitable airlines were ultra-low-cost carriers. Right that, you know what do they do and they control their costs. Parm Sidhu: 09:40 It’s a disciplined business model, it’s volume-based and we kind of went back to our partners and and the airlines WestJet and, just today, flair New Leaf and they said okay, we will grow, but get the facilities ready and reduce your fees and we’ll give you a volume. And that’s what they did. So we went from 490,000 passengers in 2015 to 530,000 in 2016, 677,000 in 2017, 842,000 in 2018, broke the million mark in 19,. One year ahead of planned. Covid hits us. We had surpluses in 2020. Why? Because we controlled our costs, yeah, and then we simply had 315,000 passengers in 2020. 2021, we hit 515-ish. 2022, we hit 992. 16,000 shy of the 2019 total. And in 2023 was magical, literally. We made travel more affordable and accessible for all Canadians. Our fares were $49 to $79. Any day of the week you can buy one, not saying on that day, but there was something. Parm Sidhu: 10:51 Low cost parking full of value. We were turning into the Vegas of Canada. Literally, our parking lot would fill up Thursday and by Monday night you can see it was emptying out. People were traveling all parts of Canada for a weekend, for remote work or whatever the reason was, but it was stimulation. But as an ultra-low-cost airport, our core business was identified as runways, taxiways, renting our land for direct investments to aerospace companies and giving the airlines a terminal that they want. They didn’t want loading bridges, they want power out. They want front and back loading and offloading. Chris Glass: 11:26 They want a simple terminal experience and in our business model, the passenger belongs to the airline and I see a very conscious I’m assuming it’s a conscious decision when I walk through Abbotsford Airport. It’s a very aesthetically pleasing airport, but it’s not unnecessarily aesthetically pleasing. There’s not statues, there’s not giant paintings and murals. It’s. It’s a terminal. Parm Sidhu: 11:51 It’s it’s clean, it’s efficient, but it’s designed to get me through security and onto the aircraft yeah, so the the terminal was designed with a lot of feedback, uh, from the airlines, and they will. They said we want simplicity, we want a terminal that’s made for throughput. This summer 2023, we were pushing through 7,400 people a day from that very terminal. Right, we have no debt today, but it’s a disciplined business model. We still fund our core business and our core assets with priority, but it’s just stay in our lane and we enable and empower the airlines to manage Chris Glass from curb to gate, gate to curb Right and we journey mapped it. At the end of the day, an airport doesn’t control a lot outside of paid parking, retail experience, the bathrooms everything else is controlled by an airline. The reason why you’ve come to the airport, for the most part, is because you bought an airline ticket. Chris Glass: 12:45 Right, nobody’s coming here to hang out on a Friday. Parm Sidhu: 12:48 Unfortunately no Maybe you’re on the airfield or maybe at one of the restaurants off outside of the terminal. But to a terminal? No, you’re coming here because you’re either you’re flying out and the airline has sold you something. Our relationship is very B2B, not B2Consumer or passenger. If a passenger has an issue with one of our facilities, yeah, we’re gonna support them and go above and beyond. But we really the airlines carry a strong voice here. Chris Glass: 13:14 What do you have to say to airlines that aren’t flying here? Like I know I’m teeing you up here, but this is a great value proposition for me as kind of a-minded person and somebody who doesn’t like a lot of waste. I don’t look around and see a lot of waste. What do you have to say to the porters of the world and Canada Jet Lines? Abbotsford’s open for business. Parm Sidhu: 13:37 We’re open for business. We’re an open platform. You know we enable airline profitability, viability and they’re enabled with a very competitive fee structure. We don’t have an airport improvement fee, we only charge a landing terminal fee and. But it stimulates growth and it’s a lot of repetitive travel a lot of first-time travelers, a lot of people going back and forth seeing grandkids, a lot of students, a lot of ethnic people flying back and forth, a lot of new immigrants flying back and forth. You make it affordable. We know we have the data. Now it can work. Parm Sidhu: 14:15 You know the ULCCs represent somewhat like a dollar store. Dollar stores force us to buy more multiple times. We buy more than what we need, and you know. And then we feel bad or guilty going to a dollar store. That’s right. Us to buy more multiple times. We buy more than what we need, and you know we feel bad or guilty going to a dollar store. That’s right. And then you know, not everyone can go upmarket and bypass the dollar store. The ULCCs bring an opportunity and ULCC fares to grow the business and grow the volumes. Chris Glass: 14:39 Right. So enough about making this a really good commercial for Abbotsford Airport, which I think speaks for itself. At Flight, we really believe in unlocking information and leaving no data strand and no data left behind, and using technology to help our airline partners do things more efficiently. We were talking, just before the camera started to roll, about some of the technology that has been used here at the Abbotsford Airport, and where do you see technology playing a role, getting you to more passengers coming through, more volume coming through, without having to build a bigger facility or without having to increase your footprint? Parm Sidhu: 15:22 Yeah, so that’s a really powerful question. So you know, technology has changed and will continue to change the way we do business, interact. The consumer will own the consumer and they’re going to be enabled by this thing called a handheld device of some sort. And you know, you can now see technologies that go multimodal air, ground, ground, air. They can take you couch to couch or home to home or office to office and you never leave a portal, a super app such as Uber. Imagine an Uber app taking you from Surrey to Edmonton, surrey to Abbotsford, and Uber same ticket gets you onto an aircraft, takes you to Edmonton. It’s multimodal, seamless. Imagine getting your bag tag printed in the Uber for a fee. Parm Sidhu: 16:09 Imagine your lunch being, or your packed lunch, or whatever you want being handed to you, right? So digital disruptions are real, but I think digital can bring a different way of stimulation and connectivity that we haven’t seen, right? Chris Glass: 16:24 So and you have some interesting theories on who should own that. I know a lot of airports sometimes buy great technology, but we were talking about where you think the technology belongs. Parm Sidhu: 16:42 Well, I think again, who sells you something? It’s the airlines, right, so what? We are platform for business. We take care of runways, taxiways and and a simple costco type of terminal. Uh, the form one of the former ceos of west that used to call us the costco of airports. High value, volume, priced one dollar hot dogs outside? Yeah, unfortunately not. We do make money off the food beverage. Uh, I can’t afford $1 hot dogs. We might have to bring back an airport improvement fee if we’re going to have that. Parm Sidhu: 17:11 But at the end of the day, the airlines, basically in our business model, control the passenger couch to couch, and the more repetitive travel they can create, the more volume we all get. They’re the ones that sell you something, right? So understanding their brand and brand loyalty and who’s in the marketplace with them allows us to basically grow our volumes. Since 2015, we have been one of the fastest growing airports in Canada by percentage points year over year, and Hamilton from 2015 to 2019, 2020 up until COVID, it was us in Hamilton and then the ULCCs were centered around these two airports in the two big markets For a reason. Yeah, the population base was there and cross-border leakage was an issue. And then COVID hit and you know the ULCCs we had a lot of competition and they had gone national right. Right, we had a lot of competition and they had gone national right, and I still believe there’s a way to do this. Parm Sidhu: 18:09 Volume-based, open for business and digital connectivity will be very important and the consumer will make their decisions. We’re not even talking wearables or voice-activated stuff yet. We’re all going to have some sort of a bot or something in our house. Someone robot cleaning or some voice-activated order me a pizza. That kind of thing. We believe all the airport processes can be put in your home. You should be able to tag your bag at home, weigh your bag at home. A domestic passenger it should be facial recognition, just through the system. Chris Glass: 18:41 I look at Al like movie theaters have been completely disrupted. Before you have to wait in line for a ticket, you have to show up early. If you remember back in the day when Star Wars came out or whatever, you’d have to line up, be the first to buy your ticket and then wait three hours to get inside and wait for a pop, wait for chips and all that kind of stuff. And now you can buy it online, scan your pass on the way through and you take your seat. It’s a much better experience for everybody, including the movie theater, and it seems that’s the way everybody’s going Well. Parm Sidhu: 19:11 More and more transactions are happening in advance, right, if you looked at car rental facilities, here operations very few transactions happen day of it’s either reservation, you know. Even paid parking now with reservations, more and more is proactive, right, right, it’s not reservation, you know. Even paid parking now with reservations, more and more is proactive, right, right, it’s not day out, it’s not reactive. So I do see digital connectivity continuously positively providing the consumer with more options. Chris Glass: 19:37 Now we were talking about the future here at Abbotsford and what that’s going to look like. So if you wouldn’t mind giving some colour on what airlines can expect when a guest gets at the very front to all the way through security. Parm Sidhu: 19:52 Yeah, we want to go multi-modal. We had a shuttle between here and SkyTrain pre-COVID, actually deeper than 2016,. New Leaf rolled out an integrated bus into their reservation system and you actually went to newleafcom and could buy Surrey to Edmonton, for example, and it was a seamless ticket air ground ground air and about 18 people were using it by week four. So we know there’s demand for multimodal. People will do things differently if there’s that opportunity. So we believe more and more of the processes will be done from your couch and you’ll do more and more from there and the airport time time in the airport in a place like Abbotsford will shrink simply because you’re going to show up, drop your bag off. Your facial recognition recognizes you’re welcome, mr Gloucester. Pre-board Screening you’re fast processed through trusted traveler programs all that. You’re flying within Canada and you’re through the system. Right? You know that’s ideally. You arrive one hour to departure and you’re boarding at minute 45. Right? Chris Glass: 20:59 and not only is that better as an experience, from the consumer’s point of view, it allows you to do more with less in the facility. Right, you don’t have the queuing, you don’t have the physical checking counters anymore, you know, you can kind of open that up. Parm Sidhu: 21:16 Well, if you journey match Chris Glass’s journey couch to couch today you buy a ticket from Flair or WestJet. You show up, we have parking to sell you, possibly because you bought an airline ticket or you got dropped off on the curb. You go to the check-in counters. You’re dealing with a Flair agent or a WestJet agent. We as the airport own the counters but the consumer doesn’t know that. Right, you use the washroom, buy coffee. You go to pre-board screening. Parm Sidhu: 21:45 Well, caatsa is a parallel entity that reports to Transport Canada with airports I can’t influence. Day up I can work with them, planning strategy, long-term assets and expansion. But day up you go through CAATSA, you end on the secure side. You buy coffee. We control that. Now you’re at a counter again that we own, but you’re dealing with West Yatter, flare and you board. So if you journey mapped it, you know the touch points of the airports is more on the facilities and secondary products and accelerated revenue opportunities for the airport and parking and food beverage. The main relationship is with the airline and they’re the ones that can take that data to convince you to travel again. And so that’s where we simplified our business, saying, okay, airlines, what do you want? They go well you manage. Curb to gate, gate to curb yeah. Will you give us lower fees? Yeah, will you give us volume? Sure. Chris Glass: 22:33 That’s the trade-off you give us the volume, we’ll give you the ULCA, if that is. Parm Sidhu: 22:41 And the ultra low cost-cost airport isn’t meaning our ultra-low-cost carriers are cheap. No, they’re not cheap. It’s more of a discipline around the core business, right. Everyone wants to complicate the business model, right, but keeping it streamlined and simple is the success of a ULCC. Chris Glass: 23:00 It’s one of the most fascinating things when you hear Michael O’Leary talk Ryan Eyre about the discipline of keeping fares low, and he’s so laser focused on keeping air fares as low as humanly possible. I heard him talk about taking the bathrooms out of planes and people thought it was a money grab and he said, no, if I could take one bathroom out, I could fit another two rows in and I could drop prices by two bucks or something along those lines. And the discipline that the ULCCs have has somewhat been missing in the airport world and it seems like I don’t want you to throw any other airports under the bus, let’s talk about this airport, but it seems like the same focus that Ryanair has on cost control is the same focus that Abbotsford has on cost control. Parm Sidhu: 23:48 Discipline around our core business. We will spend on our core business just like anyone else would, but it’s discipline around the core business and funding it well and staying true to the partnerships and collaborations we have with our airline partners. I can only speak for Abbotsford Without growing viable airlines and you just can’t grow we’ve had to fight for everything. You know, in the early days there was not a much return. We had a lot of infrastructure ahead of us. We’re scrappy. We have to fight for everything. Parm Sidhu: 24:21 Nothing comes easy for places like Abbotsford and tertiary airports in Canada. Right, Population is sparse. There’s big centres. You need competition within the space. Tertiary airports like Abbotsford and Hamilton and Kitchener come to life for three reasons Cost at the big, capacity at the big, or you land an airline that maybe doesn’t want to operate at a primary airport, like the Ryanair’s in the southwest that have done so. That is the opportunity. The population base is here to grow. The business and the brand is Canada. Right, and if only 37% of Canadians flew pre-pandemic that’s’s the number an airline executive gave me we should be driving that to 40, 45 to 50 and more. Right, Because you can’t see this country without air travel for the most part. Chris Glass: 25:11 Yeah, you can’t drive coast to coast. Yeah, do you know what that noise is? Yeah, do you know? Parm Sidhu: 25:19 what it is, what. Let’s sit here, I don’t know like it’s super loud. It’s an engine it’s yeah. So you want to give an ecosystem of value to the consumer and if abbotshire now has the data, like 7 400 people were using us. We were about summer. We were the ninth busiest airport for one-third of summer, you know. 7,400 passengers annually. That puts us at like 2.8 million for the year. Wow, that’s significant. But that just means everyone. It’s a win-win-win, because who is a ULCC passenger today? Parm Sidhu: 25:57 Well, eventually we’ll fly WestJet Premium Economy At some point yeah today, we’ll eventually fly WestJet Premium Economy at some points, because if you can’t get someone in the door, you’re not going to get them and upsell them right. Chris Glass: 26:07 Right, and I think traveling is one of those things that if you don’t do it you don’t know how addictive it is, but once you start you can’t stop. So when you use a flare or formerly Lynx or ULCC and get it in your blood, that is something that sticks with you, the love of travel that sticks with you for so long. So it’s so important to have uh. I know we’ve been having a lot of discussions recently about uh affordability and air travel from an airport operator’s point of view. Where do you see the industry now and how healthy is it? Where do you see us going? Parm Sidhu: 26:43 Well, covid wasn’t easy on airports or airlines. You know, got to remember airports are multi-decade facilities. You’ve got to plan and we may have a certain recipe here, but at the end of the day, a runway resurfacing a new runway is pretty expensive, regardless of what airport you’re going to do it at right. Yeah, uh, the core bit, the core funding of the infrastructure, is expensive. So you know, covid wasn’t easy on the airline sector, uh, and on the consumer and the passengers in north america, anywhere in the globe. So you know they’re coming out of that. Chris Glass: 27:16 You know there’s some concern, the fog of kovitz lifting, and now the new operating environment is there. Parm Sidhu: 27:23 That’s right and costs have gone up within the airline systems. Costs have gone up at airports. We do have expensive infrastructure to maintain and the ecosystem off airport. It all ties to, like I say, vegas of the 90s. It was a party, right, we were going back and forth to Vegas I think about 1,200 Canadians and I believe we were partying pretty good for 1,200 Canadians for three nights, right. Chris Glass: 27:46 We were doing. Well, I was part of that. Airfare was really cheap. Parm Sidhu: 27:50 Accommodations were, you know, 20 bucks a night. Yeah, food beverage was cheap and the alcohol was either free or nominal fee. It’s no longer that case now, right? So that is the question now, if you looked at some of the financials of the publicly traded companies in North America, there was a fair bit of them in North America that lost money in quarter three of last year, right. And now, just this morning, we were talking about our quarter one. Results for some carriers in North America were net losses, right, right. Chris Glass: 28:19 And, historically, airlines that have done very well are struggling. Parm Sidhu: 28:24 Costs have gone up and you know it’s like a restaurant in many ways. The demand for eating out is high, but the demand for discounted coupons or app-based discounts or happy hours and Saturday-Sunday brunches is high. But the restaurants want you to come for dinner for four people and drink two bottles of wine and have three course meal and drop 600 bucks right. And that’s the same challenge. I believe some of the low cost carriers and ultra low cost carriers is trying to get people to go up market with revenue. How do you, if costs go up, how do you get more revenue? But that’s where the $49 to $79 fair still stimulates. You put a one in front of that. It doesn’t stimulate domestically the same way. So, which means you know, travel could if we’re not careful. Parm Sidhu: 29:12 So right now I think there’s many challenges but there’s many opportunities digitalization, couch to couch, integrated, seamless travel options enabling the airlines couch, integrated, seamless travel options enabling the airlines. Airlines will grow if there’s competition and if there’s multi. You know if they see profit right and right now they’re just everyone’s coming out of a little bit of a storm and how do they reset and reconfigure and everything. So moving forward, that is the in the rest of you know it possibly could be a lost decade. Right, with COVID front loaded on the front end of the. Now you got airlines and everyone needs more, you possibly have economic downturn. You know accommodations have gone up very expensive. Right, airfares are competitive in some markets but you know the consumer is facing other challenges. Chris Glass: 30:01 Do you think the cost increases that we’re seeing and we’ve talked at length about this too in Mexico and in the United States, does it provide an opportunity for Canadians to enjoy Canada again? Parm Sidhu: 30:12 I think so. I think you know historic. If you looked at it, you know we were leaving the country from November till April 30th because it was cheaper and warmer and you never heard. It was a walletless holiday when you bought an all-inclusive right. But the all-inclusives are changed now too. Try going to a major US city or into a hotspot like Cancun or Los Cabos. It’s very expensive. If you looked at even Hawaii, an average Canadian probably is now priced out of Hawaii. They can only go there if they plan, budget for it and go that way. But you just aren’t going to pick up and go as an average Canadian to Hawaii you might get an airfare, something you plan for. Parm Sidhu: 30:53 Yeah, yeah, and travel may become one of those things again if we’re not receptive to making the current airlines, making them grow, giving them what they need. You know, our airline partners want to turn planes here in 30 minutes. We’re working with them to turn these things in 30 minutes, right? Chris Glass: 31:09 Right. I’m seeing ground loading behind me and seeing both doors to get to that efficiency. So it’s cool to see that the resurgence of the quick turn coming back? Parm Sidhu: 31:20 Yeah, because if you can’t move it, you can’t sell it, and then you can’t if that thing’s not flying, it’s not generating any revenue, right? So you know, we’re all about Canada and we’re all about making travel accessible and affordable for Canadians. We’ve seen it done, we have the data and since from 97 to 2003, the data was stimulation 2015 to 2023, the data’s right in front of us. It’s a significant ride. Chris Glass: 31:45 We’re kind of coming to the end of our pod for the day, and one thing that I ask every individual guest is where should I be going next on my vacation? And you seem like a very well-traveled human being, so what am I missing? What should I see? Where should I go next? Where should we take the jump seat on the road? Parm Sidhu: 32:04 The brand is Canada. Everyone wants to always leave Canada or get on a plane and leave. As much as that’s great from an airport perspective, go see our wonderful country, go see the Maritimes, go see Quebec City, go see Victoria, go see Canada. I do believe we have an opportunity to possibly make domestic travel more of a year-round product, as other markets price us out. And if you looked at COVID, what was first? To recover and come back Domestic? We were one of the first airports to come back daily, weekly, monthly, annually, and it was heavily concentrated on domestic travel. So why can’t we make it year-round? Why can’t we go to the Carnival in Quebec in February, if we’re given that opportunity? Chris Glass: 32:47 Right, so you’re motivating me to stay in our country this summer. So, parm, thank you so much for being open to these conversations, making us such a wonderful guest here at the Abbotsford Airport and being a part of our show. Thank you, chris. Thank you so much for spending some.

About This Episode

In this episode of the Jump Seat, host Chris Glass sits down with James Wong, Senior Vice President at Menzies, to discuss his fascinating career in aviation. From his early days in the Royal Canadian Air Cadets to pivotal roles at WestJet and his current position leading Menzies’ operations in Southeast Asia, James shares valuable insights into the industry. They explore the evolution of big data in aviation, the challenges of managing global operations, and the growing opportunities in the Southeast Asian market, particularly in cargo. Tune in for a deep dive into the future of aviation and the lessons James has learned from his diverse experiences around the world.

Podcast Transcript

Chris Glass: 00:00
Over the past two years, I’ve been the host of Flight’s Jump Seat and I’ve had the time of my life telling all of the best aviation stories we could find. We’ve talked to CEOs, we’ve talked to pilots and we’ve talked to people in the aviation industry about this dynamic industry that we all love. But now it’s time for something new. I’m going to be moving on to a brand new podcast that we’re very excited to bring you, called the Open Skies Podcast. We’re still going to continue our mission to tell the best stories that we could find in aviation and the airline industry, so please join us anywhere. You can find your pods on the Open Skies Podcast or you can follow us on LinkedIn and Instagram. I’ll see you on the new channel. Ladies and gentlemen, welcome to another episode of the Jump Seat. I am here with James Wong, Senior Vice President, with Menzies Correct. Welcome to the pod, James.

James Wong: 00:48
Thank you, thanks for having me Full disclosure.

Chris Glass: 00:50
I’ve known you for a very long time and you know we go back a long time ago from our WestJet days, so it’s not like this is the first time I’ve met you, correct? So let’s talk a little bit about your aviation history. So where did it all begin for you?

James Wong: 01:07
Where it all began.

Chris Glass: 01:08
Because you’ve had a fascinating career in many different ways.

James Wong: 01:12
I think it started when I was 14. My parents actually forced me into air cadets, into the Royal Canadian Air Cadets. So that was the spark. That was the spark for the rest of my life.

Chris Glass: 01:20
Okay, and what did that lead to?

James Wong: 01:23
What that that lead to. So I mean through the AirCamp program I became a pilot and that kind of blended into schooling for post-sec, into SAIT where I did my avionics, and then from avionics into flight simulation, which is where I joined WestJet and met yourself, and from there into the corporate side of airlines. I furthered education into you know some degree programs and whatnot and moving up the airline world, starting some business on the side just my entrepreneurial hobbies and eventually leading to Menzies and my current role, now based out of Singapore.

Chris Glass: 01:57
So you’re a long way from home, but Calgary is always kind of home-based for you.

James Wong: 02:00
Calgary will always be home.

Chris Glass: 02:02
Right, so let’s talk about your SimTech days, because that’s where we first met, yeah, and that gave you a certain experience. So what was that like?

James Wong: 02:09
That was six or seven years of my career, I suppose, at WestJet and pivotal, pivotal career growth anyways. That’s where I learned really the WestJet way or back in the day when WestJet had good Kool-Aid and I learned a lot about leadership and management and grew up there really understanding the civilian side of the business and learning about airlines and whatnot. So it was good Finished off as a lead hand there, but yeah, it was fantastic.

Chris Glass: 02:37
Now, and so the SimTech world, but then you transitioned to another part of the company. So let’s that’s where we really got to know each other other than, uh, just the, uh, the sim world, uh, where we actually worked directly together and, in fact, you were my boss at one point. So let’s talk about the ops performance team, the legendary performance.

James Wong: 02:57
that was, uh, uh, an interesting team actually. I really enjoyed it. Uh, allowed me to flex some new skills as it related to business analytics and operational analytics, so really giving a bird’s eye view of the entire company, both from an operational standpoint and from a corporate admin side of things. So that was a really good experience and really seeing how all the puzzle pieces fit together that actually ran an airline and how it related to efficiencies and operations so extremely useful in that span.

Chris Glass: 03:28
Did you feel back then because I have my opinions, but do you feel like we had the data that needed to make the decisions we were making, or do you think there was a gap?

James Wong: 03:34
I think the world was young, so it wasn’t just WestJet or the IT investments that were involved and whatnot, but I mean big data was still relatively young at a global level, and unless you were the Amazons or the Microsofts or the Googles that specialize in IT all this other industry is falling behind and a lot of companies like WestJets, as a personal opinion, would underinvest in that part of the world and try to fill those gaps with people.

James Wong: 04:02
And I think in this day and age, if you were to compare the technologies and the cost of technology today compared to what it was when we were there 10 years ago, there would be a big difference.

Chris Glass: 04:12
Right, especially with the elasticity of some of the cloud-based computing, that goes on. You kind of pay as you go and it’s cheaper on the lower end and elastic. Do you see the same gaps now? Or do you see airlines making the same mistakes or maybe not evolving quickly? Or do you see some airlines well ahead of the curve?

James Wong: 04:36
I think the gap still exists, but it’s different. Okay, the concept of big data and data lakes haven’t been around for that long, you know, like they’ve come in tranches in terms of like five or ten years, five or ten years and even with the onset of AI. Now, now everyone’s trying to scramble and adapt to even a newer technology, whereas they may not have even established the infrastructure for the older technology.

Chris Glass: 04:56
Right.

James Wong: 04:56
So we’re constantly learning and trying to take advantage of new technologies, and companies are trying to constantly stay at the forefront of what they can afford, right. So because of that, it creates gaps all the way through. So while they’re still learning and still trying to build a foundation, they’re also trying to drive forward, right.

Chris Glass: 05:13
Right.

James Wong: 05:13
So I think that even the advent of AI, everybody wants to take advantage of it.

Chris Glass: 05:17
Nobody really knows how. It’s kind of the buzzword right now. Yeah, exactly, and in some companies it’s just a chatbot working really well, and in other companies it’s major decision-making.

James Wong: 05:28
Absolutely, absolutely. And then it’s so department-driven as well, right? So, although a company might have a really grand IT map and dream, really, it’s department-driven by the individual managers, and sometimes they just go all over the place.

Chris Glass: 05:39
So after that you had two kind of forks in the road. You left your Westhead career, and where did you go from there?

James Wong: 05:51
Yeah, I went to a company called Clear Grid.

Chris Glass: 05:53
Right.

James Wong: 05:53
And Clear Grid is based out of Springbank here in Calgary with a really good friend of mine and she continues to operate the business and basically it’s an aerial data collection company flying small aircraft around all of Canada. An aerial data collection company flying small aircraft around all of Canada.

Chris Glass: 06:06
So I think you’re underselling it a bit, because I think ClearGrid is a very cool.

James Wong: 06:19
This is not a paid advertisement for ClearGrid, but meter readers used to go house to house to house to house to check if it was accurate, correct. Yeah, we introduced some amazing tech to check if it was accurate, correct. Yeah, we introduced some amazing tech. So most meters electricity or water meters and whatnot back in the day it used to be a person that walked up to your house and would collect the data physically and visually by looking at the meter. A few decades later it turned into wireless. People would drive around with trucks and even to this day that seems to be the more predominant way of collecting meter readings.

Chris Glass: 06:42
They drive around with a truck and it’s wireless.

James Wong: 06:45
Just hitting each. Yeah, exactly, they’ll drive down the street and they’ll just collect everything wireless off the signal. And what we’ve done is really developed a technology in that company to have even greater sensitivity and fidelity, and we can capture the same signal except from a few thousand feet away, so far enough that it’s about 5,000, 6,000 feet, and so we threw the technology into an aircraft instead, and because of that the sweep is significantly greater. So what would normally take 100 drivers in 30 days in a cycle to capture all of Calgary, we can do in two days in one aircraft.

Chris Glass: 07:16
That’s crazy.

James Wong: 07:17
Yeah, so we save a ton of carbon footprint, a ton of labor, a ton of cost for the utility companies. We’re able to sell that data back to the billing cycles.

Chris Glass: 07:25
Now a ton of costs for the utility companies. We’re able to sell that data back to the billing cycles. Now, how many cities is ClearGrid operating in now?

James Wong: 07:29
In Canada. Yeah, Right now we cover all of Alberta, both rural and urban, which is fantastic, and then expanding into Ontario, as well as some work south of the border in the US as well.

Chris Glass: 07:40
Wow, okay. Are there many competitors in the space, or are you really the primary disruptor?

James Wong: 07:46
We are the sole service provider, sole service provider, that’s a good place to be.

Chris Glass: 07:54
Yeah, absolutely, excellent. Okay, so that was one fork in the road. What was the second fork? Because you went from ClearGrid and then you ended up where.

James Wong: 08:01
Yeah, that’s when I ended up at Menzies Right. So in ClearGrid I took care of flight ops and the operations that ran that business and then Menzies asked me to go out to Vancouver. I helped them out with the business out there for air cargo.

Chris Glass: 08:13
And that was a small, smaller operation at the time.

James Wong: 08:16
Smaller operations, only about 130, 150 employees, given at the time it was 2018, I think it was and basically we were just running a few, you know, budgetary problems and some cultural issues. So just looking for a manager to kind of flip that business around, move it back into success, drive some operational efficiencies and move on from there.

Chris Glass: 08:35
And you probably expected to spend a long time in Vancouver.

James Wong: 08:38
Yeah, I had planned on living there for quite some time. I was only there for six months, six months, six months. It was an interesting adventure in those six months, though.

Chris Glass: 08:46
Excellent. So what did you learn from your six months in Vancouver? What was the big takeaways?

James Wong: 08:51
You know, I think Menzies was the first true multinational corporation I’ve ever worked for Really, and so that was a lot of exposure in understanding how a real MNC operates from a business perspective and how it integrates on a global level and with a company that’s spread right around the world. So that was really really neat, as well as exposure to multiple international airlines and the different operating procedures and SOPs that they had. That was something very unfamiliar for me because I was so focused on WestJet.

Chris Glass: 09:21
You grew up in the world.

James Wong: 09:22
Yeah, exactly, and to see the diversity and the different ways that people do things was quite an eye opener and that was extremely helpful and really helped broaden my base as well as to meet a ton of people from the global industry, so that helped a lot in that experience.

Chris Glass: 09:37
Right, yeah. And then from Vancouver you ended up moving to.

James Wong: 09:41
Toronto. Yes, so we moved from the GM of Vancouver over to a sales position, commercial, into Toronto to run Menzies Canada, and that was right before COVID. So that was a really good experience as well. So I kind of started moving my career more as a corporate and now to the commercial side, so kind of taking care of the operations, looked at HR when it came to organizational development and redesign for org structures, looked at HR when it came to organizational development and redesign for org structures, and then now I’m moving into the commercial world and that was really really neat, really understanding how the revenue side of the business plays with the cost side of the business and how to integrate that, and that was a really good learning experience as well.

Chris Glass: 10:18
And then COVID. Yeah, covid was fantastic, which is pretty much everybody’s story when it comes to it. We recorded an earlier podcast where COVID came up as well. How did that affect Menzies in Toronto? For you personally, and I know, 90% of the industry was relatively shut down at that point, but how did that affect you? How did it affect your role?

James Wong: 10:40
COVID was a sad time. Most people would say challenging, but on a personal level it was a sad time. Most people would say challenging, but on a personal level it was extremely sad. You know we went. We probably reduced our labor workforce close to 80, 85% in that span of six months. And to have that personal touch point with laying off people and giving them bad news was on a personal level, very, very tough. But it was also great motivation to drive the business forward in terms of growth, to get those jobs back.

James Wong: 11:08
Yeah, and we were really lucky in some ways. I mean, our head office in Toronto went from about 50 employees down to six, and the six of us managed to grow the business geographically during COVID and we were able to grow it. We really tripled the footprint across Canada, from four stations to 12 and then later on to 16. And so, although we weren’t able to retain jobs in existing stations because we had to reduce the size, we were able to establish new opportunities in new places, right. So at least it was kind of a. I mean, on paper it looked great because we were growing. On a personal level, it was still tough because it was still impacting individuals, right. So that was a really interesting way to play the game. When we called it a day, I really reflected on what we were doing. We were using the excuse of hey, the company is still alive, we’re still thriving, we’re still growing. But it was definitely tough on a personal level, talking to individual people.

Chris Glass: 12:02
So when you went down to six people, part of that had to do with the border closure and nobody being able to come over and help and help support you guys. So how did that go? Did you feel like you were on your own island?

James Wong: 12:18
A lot of people say that really we are a small business. Menzies is a small business. Yeah, we’re 50,000 people across the globe, but the reality is that the people that actually run the business is very, very small. Right, you know, head offices might only be anywhere between 10 to 20 people, even though there’s, you know, thousands of frontliners.

Chris Glass: 12:37
Right.

James Wong: 12:37
That are actually doing the work, and a lot of that was really emphasized during COVID. You know we were down to a team of six. We still had thousands of employees that were still with us, that were still retained Right and between six of us. In a small business, like any small business, you tend to do whatever needs to be done, right? So, even though a person might be specialized in HR or one specialized in ops, roll up the sleeves. Yeah, exactly, if a room needed to be painted, then Exactly. If a room needed to be painted, then you would paint the room Whatever it took, throwing bags on the front line when we had to, driving the accounts and doing AP and AR when we had to, whatever it took. And so it was actually, in some ways, a blessing in disguise, because you got to touch every single part of the business as a result of that.

Chris Glass: 13:21
And one of the big trends during that whole COVID time was the outsourcing of jobs by airlines. So, airlines would stop using their own employees. How did that affect Menti’s?

James Wong: 13:34
I mean that’s a good news story for the ground handling industry. What’s interesting about it, though, is that when these airlines decide to change their strategy across and outsource the work, they would change the way that they did business operationally.

Chris Glass: 13:48
Yeah.

James Wong: 13:48
And that’s something that a lot of airlines are not willing to give up in some ways. Yeah, but further to that too in their strategies for outsourcing, is that they would divide out decision-making capability so they’d have their ops teams driving efficiencies, driving the SOPs and then they would separate the financial side. The separate team usually bundles the procurements and those teams don’t talk, and they never have no, and they all operate on different KPIs. One wants to get the best deal and one wants to give the best service, and everything comes at a cost, right, and so for ground handlers in our field, usually we tout ourselves as being experts in the industry, experts in those specific processes to turn aircraft.

Chris Glass: 14:27
Right.

James Wong: 14:28
And so the tighter the cuffs that a customer puts on us, the harder it is to do our job, the higher the cost rate. Yeah, and so a lot of it is cross-communicating, educating the carriers in terms of what do they actually want?

Chris Glass: 14:40
Right.

James Wong: 14:41
And what are they willing to pay for? Right, and that’s an interesting dynamic that a lot of these airlines didn’t have. Right, because they had a lot of control over their main hubs, which is their primary point of contact their passengers, but yet in the smaller hubs, or even the smaller airports that they fly to, it’s not as important to them, and so having them lose some of that control is very nerve wracking for them, right, right?

Chris Glass: 15:03
Do you think that process is finished now? I know you’re not in canada anymore, but do you do you think that’s still in flux or do you think that it’s kind of settled now?

James Wong: 15:13
you know, I’m not really sure about the canadian landscape, but I know that this wasn’t just a canadian phenomenon.

James Wong: 15:18
This happened in australia, happened in the us um, and even now, with a lot of the startup airlines that are happening, um, in the southeast asia and china, they’re starting to recognize that at the get-go, at the start, right, and a lot of it is saying what is it that you actually want to accomplish with your passengers? You know, how do you want to measure what you consider to be success, whether that’s an NPS score, you know, or D0 timing or whatever the case may be Surviving Correct.

Chris Glass: 15:42
Provide the service.

James Wong: 15:43
Yeah, or if they have a margin to hit right. What is that measurement and how much do they actually want to get involved with the process?

Chris Glass: 15:49
Right.

James Wong: 15:49
Right and how much do they want to trust with us. So I think they’re a lot more open nowadays than they were back in the day, and even Qantas, if you look at them, like they’re trying to potentially bring it all back in, and they were actually the first ones to set the bar and send everything outwards right. So it’ll be interesting to see what happens in the next year or two, whether it’s worth doing. Yeah, exactly.

Chris Glass: 16:13
Okay so now you’re starting to talk about the Asian marketplace. How did you end up? Toronto to Singapore?

James Wong: 16:18
You know what? Southeast Asia is one of the largest growing economies, especially even in terms of the rate of growth. Cagrs over the last five years has been upwards of 8% to 10%, which is massive. And then, when we look at China, they’re talking about a pullback in terms of economic growth, showing figures of 4% to 6%. There are massive regions of the world that would die to have a 4% to 6% growth rate just because they came down from the 20s, go figure.

James Wong: 16:45
So MEDSYS was extremely underrepresented in that part of the world and so there was a large opportunity to be had and not in a focus for our company at the time. So it was a good opportunity to head out there and kind of start leading the growth and the presence of Menzies in Southeast Asia.

Chris Glass: 17:00
So what’s that like now?

James Wong: 17:02
What’s that like now you?

Chris Glass: 17:03
took the big risk, moved out there, yeah. And now how’s it going? What’s the market like? It’s going well.

James Wong: 17:10
It’s still a big market and we’re still very small. When I got out there and we established this new region for Menzies, we only had two operations, one in Macau and one in Jakarta. That was it and a really small employee count, just about 1,100 employees. And that was two years ago, two and a half years ago now, and now we’re currently sitting at about, I’d say, four to five operations, one of them’s kind of quasi, and you know, upwards of 4,000 employees. You know, triple the P&L that we had two years ago. So it’s a really, so far, it’s a good success story, but it’s a very different way of doing business out there as it is, compared to North America or even Europe.

Chris Glass: 17:49
So give me a little bit about that. What’s the differences?

James Wong: 17:53
Yeah, you know it’s interesting. I’ve been studying this for some of my schooling that I’m still doing and I’m really into business development now. So it’s all about mergers and acquisitions and greenfield growth and it takes a lot more patience to do business out there compared to the, I guess the more Western corporate style of doing business over here. You know, everything here is actually a lot more numbers driven and very factual in a lot of ways. So it’s actually quite easy to counter, argue and negotiate and whatnot. 007.

Chris Glass: 18:23
Yeah, numbers are numbers 008.

James Wong: 18:24
Yeah, numbers are numbers, and I find that in Eastern corporate culture there’s a lot about relationships and a lot about networking, and sometimes it takes years to build on those relationships Right, and that’s really the key, and I think some of it exists in Western corporate culture, but it’s not as forefront. You know, here you can sit down with the procurement team that you’ve never met before and hash out a deal in three, four months Right. But over there you hash out deals over years Right, and really the payback is on the back end. It takes a long time for it to realize. So the question is whether or not companies are willing to invest for that length of time and not see any results just yet. Yeah, and it’s difficult when you’re dealing with public companies, you know, because they have the quarterly reports they have to do, they have their annual reports that they have to do, right, so they need to show something to the shareholders to prove that investments are going to pay off and get an ROI. But you don’t really get that when you’re investing in relationships.

Chris Glass: 19:17
Right. So it’s not speed dating, it’s long-term relationships. Yeah, what’s?

James Wong: 19:26
Menzies market share right now in Southeast Asia. Oh, we’re small. I mean, the largest player right now in Southeast Asia is Sats, who recently acquired WFS. I’d probably say we’re tiny, tiny. Even from a percentage standpoint, I’d say we’re less than 5% on the market.

Chris Glass: 19:42
So this gives you an incredible opportunity to start stealing some market share.

James Wong: 19:47
Or growing new ones. Yes, Growing new ones.

Chris Glass: 19:49
Okay, where’s the opportunities? Where’s the growth?

James Wong: 19:51
You know what, china is always going to be the massive driver. You know, swissport tried it decades ago and they ended up in a reverse buyout and they failed. And I think that that was kind, of, you know, going back to this whole concept of the Eastern corporate versus Western corporate style. That’s kind of what happened, right. And I think this time around there’s a strong possibility that we can, you know, kind of bridge that gap, yeah, and try to explore and grow into China. And we just recently established operations again in Hong Kong, which is, you know, a massive airport for us at a global level, and using that leverage and the momentum that we have from our reputation now to kind of drive even further inland into China. So I think there’s a lot of opportunities there. The government’s shifting, it’s a little bit more stable if you think of it independently from North America, and they’re really starting to deregulate and modernize their aviation systems.

Chris Glass: 20:42
Excellent.

James Wong: 20:42
So that’s good. Yeah, there’s so much growth happening in china when it comes to aviation absolutely like there’s new airlines popping up everywhere, and there’s new aircraft. New aircraft yeah the comac.

Chris Glass: 20:54
Uh, we’re on a few of those planes. Um, it’s just an amazing growth sector. Uh, what’s it like doing business in china versus the rest? Is there a difference with China versus the rest of Southeast Asia or and I’m not talking like Australia, new Zealand, that kind of like the?

James Wong: 21:13
Probably like the Malaysia, the Thailand, the Singapore yeah, it’s. They’re still very traditional in a lot of ways, and you know where the rest of the world is trying to get away from business cards, for example, just as a sign of sustainability, in China, that ritual of exchanging business cards with a bow and a handshake will always be there.

Chris Glass: 21:31
Right.

James Wong: 21:32
You know. Similarly, when we sit in boardroom meetings, they’re very formal and whatnot, and I think that that’s going to carry on, at least for the next few more decades. Right, you know that culture, those rituals, will continue to always exist, right, whereas the Southeast Asian or the Asian, tends to be a lot more adaptive and more westernized than China ever will be right. So just recognizing that the cultural differences and being sensitive, you know, to every single country that you go into is extremely important.

Chris Glass: 21:59
So it sounds like there’s a lot of pre-work that goes into that.

James Wong: 22:02
Absolutely. Tons of cultural study, right Trying to figure out exactly how to connect Correct. Even something as simple as trying to present a thank you gift is very sensitive, both in terms of sitting on the fence between bribery and corruption and saying that this is actually a genuine appreciation, business to business kind of thing, versus I don’t know what a good comparison is.

James Wong: 22:29
It’s kind of like birthdays in a lot of ways between between Eastern and Western cultures. You know, in the Western culture when you get a birthday gift it’s important that you act really excited and you open it right away and you play with it and you appreciate it right away. In the Eastern side of the world, when you receive that gift you often put it off to the side and that delay of gratification is just a sign of respect to the person that’s actually giving it.

Chris Glass: 22:52
And somebody from a Western culture could be like they do not like the gift, Exactly, yeah so it’s really understanding those little nuances and they feed right into business and negotiations and whatnot. Have you found that a challenge growing up here in Canada, transitioning to that market, to understand those differences and to, I guess, be respectful of the cultural differences?

James Wong: 23:13
Yeah, I think I’m pretty lucky because I’m a first-generation Canadian, generation Canadian, so I still had a lot of my experiences on both sides of the cultural barrier. So it was really, really good. It helped a lot that I’m Western educated but I’m able to appreciate some of those cultural sensitivities. It’s not to say I’m an expert. When I got there it was still a culture shock for me and I’m still learning day by day, week by week, when I’m going to those countries and interacting with those people.

Chris Glass: 23:39
So, yeah, so million-dollar question then what are airlines not doing that they should be doing now? Based on your experience, you’ve seen both sides of it. You’ve seen the operating of an airline, you’ve seen being a partner of the airline. Right, where’s that sweet spot between outsourcing, keeping things in-house, deferring to the experts, versus becoming an expert yourself when it comes to ground ops and that kind of stuff, like what is the trends that you’re seeing that you think airlines can improve upon?

James Wong: 24:12
You know, that’s an interesting question because it, I guess, is really specific to what sector of an airline. You know. Whether you’re talking about passenger airlines, talking about cargo airlines, you’re talking about guys that just specialize in ACMI charters Right, and there’s room for all of them and there’s room for a lot of different business models and ultimately it really depends on where they want to put themselves in that model. Right, Are they a low-cost carrier? Are they a true ULCC? Right, Are they somewhere in the middle? Yeah, are they hybrid? Are they full-service carrier? And really being able to identify where they are and having deep enough pockets to drive that business until it becomes profitable.

Chris Glass: 24:47
Right.

James Wong: 24:48
You know, in the last two years I’ve seen multiple airlines spark up and fail, you know, within a span of a year. And again I’ve also seen some airlines that have sparked up and have been able to just barely sustain, you know, like they’re now operationally break-even in the grand scheme of things, but they’re still losing money.

Chris Glass: 25:03
Right.

James Wong: 25:03
And I think a lot of them lack identity and there’s not enough airline expertise driving the growth of a lot of these carriers. You know, a lot of them are startups from people that still think of aviation as being very, very sexy. You know, I get to buy an airplane. Oh, I own an airline. It’s fantastic.

Chris Glass: 25:20
And it is until you have to pay the bill. Yeah, it’s only going to cost me $10 million, and then, all of a sudden, they’re in for $100 million and they don’t realize.

James Wong: 25:25
you know I’m still losing money it doesn’t make sense, you know, and they hire the wrong people in place. It’s still very, very small, right, and I think that the ability to adapt across the border and globally is great, but the reality is that every region, every country is still unique.

Chris Glass: 25:41
Yeah.

James Wong: 25:41
You know, and we even see that in Canada, when you start importing talent from either south of the border or across the pond to try to run carriers here, it’s that they all have successes in their homes, where they grew up, you know, very familiar with the market, with the economics. And then trying to apply the same you know cookie stamp into a different part of the world is very, very tough.

Chris Glass: 26:06
Yeah, you know, you hit the nail on the head too when you’re talking about Canada as a very unique environment, right, people think you could take the ULCC model and go. Well, canada is one of the only developed countries that doesn’t have one like a real successful one. And I’m not discounting Flair, but I mean to be continued there. Right, they’re not at that stage of 50, 60 aircraft yet. And you know, you have these ideas that come in and think you know, hey, we’re going to revolutionize this space, and then you realize how far apart Canada is how high.

Chris Glass: 26:34
The taxation is how the airport rent situation is different from other operating environments, and then they’re just not successful. You know, do you? This is a question just off the top of my head. Do you feel ULCC in Canada can be successful based on your experience?

James Wong: 26:51
I’m not an expert in the airlines. If I was to start one here, I probably wouldn’t start at ULCC, great. But there’s no demand in Canada for flying relative to other countries and other places. When you look at, you know now that I’m more familiar with Indonesia and Malaysia and Singapore and Thailand, stuff like that, the sheer density of the population. Yeah, by consequence, there’s a demand for aviation.

Chris Glass: 27:14
Yeah, you don’t see Dreamliners on commuter routes here.

James Wong: 27:17
Yeah, exactly, you know those guys are flying A380s for an hour and a half legs Right and they’re full, and they’re full, yeah.

Chris Glass: 27:26
Yeah, it’s tough to get a quantity scale.

James Wong: 27:27
That’s crazy.

Chris Glass: 27:32
Okay. With that being said, where do you think, besides China, is the next growth sector in Southeast Asia? Like, do you see more ULCs coming up? Or do you see, like, what’s the trend?

James Wong: 27:45
Cargo. Cargo carriers are the way to go.

Chris Glass: 27:48
Still, absolutely, because that was the big buzz after COVID, everybody wanted to start a cargo airline. Is that still on fire down there?

James Wong: 27:56
You know it still is. It’s that the commodities have changed. Yeah, you know, the advent of e-commerce, shopping and whatnot that started or really took hold during COVID, continues to take hold now. Right, you know companies like Tmoo and TikTok and Taobao and Amazon those guys are continuing to drive demand. Yeah, the difference is that cargo warehouses were never designed for e-commerce. You know, they’re designed for big, dry goods.

James Wong: 28:19
They’re designed for fruits and vegetables, yeah exactly Designed for pallets, not small envelopes by the thousands. And that’s kind of where the demand is now. Everybody wants their goods. You know, within the hour or the same day. And when we look at Southeast Asia, everything’s an island. Everything, from the Philippines to Indonesia to Malaysia, everything’s islands.

Chris Glass: 28:38
Yeah, so you’re not driving it in a truck, yeah exactly.

James Wong: 28:40
And then just north of that is China, where 90% of these goods are being produced and continue to be produced regardless, right? So there’s a huge demand for narrow-body cargo, as much as there is for international cargo on wide bodies. I mean, just recently, air France, air France KLM or Martin Air, their cargo subsidiary, just shifted cargo capacity from South America down over to Southeast Asia and China Wow, and a massive movement of their widebody fleet across the board, because they need more space, they need more to meet the demand, essentially, right? Wow, it’s quite significant.

Chris Glass: 29:14
I never even thought about how island-specific Southeast Asia must be for cargo that does lend itself very well to air travel.

James Wong: 29:22
Yeah, absolutely. If you look at just Indonesia, it’s actually wider than Canada is in terms of east to west, in terms of their geography, and there’s over 200 islands, and so everything is driven by air, absolutely everything.

Chris Glass: 29:36
Well, it sounds like you still have a lot of work to do in Southeast.

James Wong: 29:41
Asia. I’ll be there for a while.

Chris Glass: 29:43
That’s good. Well, we’re about done for time today, but what I would like to ask everybody is I love to travel. You’ve seen the world. Where do I need to go next?

James Wong: 29:54
Where do you need to go next?

Chris Glass: 29:55
Besides Singapore to see you, you know what.

James Wong: 29:57
Singapore is a great place to base yourself out of. Look at it that way, you know it’s very similar to Europe. Once you’re there, traveling is like very, very cheap right. So definitely come to Singapore, base yourself out of there, spend a couple of weeks. Yep, you know, bali is a quick hour flight away. The Philippines are fantastic if you want to go to Cebu or Manila to actually check out the beaches and the big cities and whatnot. China is an amazing country to actually see with your own eyes and really get your own objective viewpoint of it. They’re decades ahead of us, decades ahead of North America really, when it comes to technology and economic growth, and Hong Kong has come back full bore from what it was 10 years ago. It’s a great city to be in now.

Chris Glass: 30:37
Well, and Hong Kong has come back full bore from what it was 10 years ago. It’s a great city to be in now. Well, I’m going to have to take you up on that Singapore offer. And thank you so much for coming into the office On your vacation, no less. So I do appreciate that. And thank you for spending some time with us on the Jump Seat today. We’re going to be back with some great new episodes coming up soon. Thank you so much.