That makes sense in theory but in practise I don't think the Alliance and the PCs could agree on what seats to concentrate on to come up with a good comparitive advantage formula.
In the end it all goes back to the individual "riding" level of every voting region. And incumbent politicians might have had to give up their seats for a 'greater good' - unlikely... Also, many voters are sentimentally attached to 'their' party and won't vote for another rightwing party unless they have no choice. For some time the Tories thought they were fighting to stay alive and the Alliance thought they could easily destroy the PCs. That wasn't condusive to any kind of agreement.
Now it's happened. I'm surprised and wonder whether it will work. And what happens to the Red Tories? Will they split off? Or join the Libs or NDP?