First Air, Canadian North codeshare has Nunavut passengers worried

Nunavut travellers are worried that increased co-operation between two of the North'sbiggest airlines will leave them with fewer options and higher fares.

"Some communities, smaller communities are getting now one flight per day. They use to get two flights per days. Now we are jumping back to the 1980s. That's terrible," said Joanasie Akumalik, an Iqaluit city councillor.

Nearly a year ago,merger talks between Canadian North and First Air were called off. Butwhile afull scale merger didn't happen, the two airlines launched a codeshare agreement in July thatallows the two companiesto sell seats and cargo on some of each other'sflights.

In many cases it means fewerflights for communities. In the Baffin region,Clyde River, Pond Inlet, Pangnirtung and Qikiqtarjuaq were all serviced by Canadian North and First Airflights.

That's not the caseany more;now, Canadian North sells seats onFirst Air flights to those destinations.

"If you had two flights a day where there weren't the seats filled, it might make sense economically to have one flight," saysKarl Moore, an associate professor withMcGillUniversity'sDesautelsFaculty of Management,who has studied the airline industry in Canada.

"On the other hand, it's a basic law of economics that if you have fewer competitors or no competitors, it's very tempting to raise your prices and there is not much you can do about it as a traveller except not travel."

Identical fare structures

StartingAug.18, First Air employees in Ottawa will be checking in travellers on Canadian North's daily flight toIqaluit.Earlier this yearFirst Air laid off 25 personnel, thoughmany were then hired by Canadian North.

Both companies recently altered their fare structures, changing them to bevirtually identical right down to the marketing names, like "saver" fare, "flex" fare and "super-flex" fare.

They also both introduced achange fee to their beneficiary fares, which are special reduced ratesfor beneficiaries of land claim agreements of the Inuit groups that own each airline. Under thenew rules it costs $75 to change a ticket booked under a beneficiary fare. If the traveller misses theflight, without rebooking it at least two hours before departure, theticket is cancelled with no refund.

"[Dealing with new rules] is more inconvenient for those of us who are not bilingual," says Grise Fiord resident Larry Audlaluk.

"I can speak English and Inuktitut,but I have a sister who is elderly who doesn't speak English and that's going to be more difficult for her, I'm sure."

Blurring the line

Moore says it's not uncommon for an airlineto match a competitor's fares. Since Canadian North and First Air are still two separate entities, he says it's unlikely theirpractices would everbe reviewed by a regulating body like the Canadian Competition Bureau.

"[Increased co-operation is] blurring the line between who is a competitor and who is a partner." Moore said.

"And that's the concern, that without competition, rates will go up. That will be good for the airline but detrimental for the community."

CBC News contacted both First Air and Canadian North for comment on this story, but neither responded to requests.