Air Canada's slow descent -

Air Canada’s slow descent

It is the country’s biggest and most dysfunctional airline, at war with its unions, losing money and protected by Ottawa. There may be only one way out.

A slow descent

Photograph by Cole Garside

The Air Canada back-to-work legislation, passed March 14, was meant to spare Canadians from the nightmare, both personal and economic, of a crippling strike by ground workers and a lockout of pilots at the country’s biggest airline. So far, however, it’s only made a bad situation worse, fuelling more labour hostilities and chaos for passengers.

As they returned from March break, sun-seekers still faced long delays after an unusually large number of pilots called in sick. A few days later, dozens of flights were delayed or cancelled after angry baggage handlers in Toronto launched another wildcat strike—this time in apparent retaliation for Air Canada’s decision to discipline three workers who gave federal Labour Minister Lisa Raitt a mocking “slow clap” as she strolled through Pearson’s airy concourse.

More recently, television viewers were treated to the spectacle of pilots’ union president Paul Strachan on the CBC issuing veiled warnings about the potential for deteriorating safety standards at his employer. Wearing full uniform, he suggested the bankruptcy of Aveos Fleet Performance Inc., the airline’s former maintenance arm and major maintenance provider, could lead to future aircraft repairs being done at low-cost facilities in El Salvador, where employees can be paid as little as $16,000 a year. “My question to you is: Is this the man you want maintaining the aircraft that you fly on so frequently?” said Strachan. “I suspect not.”

Air Canada threatened to fire Strachan, calling him “irresponsible” and stressing it had no plans to service its jets in Central America (although it didn’t rule it out either). In response, a small group of pilots staged an illegal “sick-out” last week, causing the cancellation of more than 40 flights across the country and throwing the travel plans of thousands into disarray. “As a result of trying to legislate away uncertainty, they’ve done exactly the opposite,” George Smith, an adjunct professor in the school of policy studies at Queen’s University, says of Ottawa’s actions. “I’m sure that people looking at travelling for their summer vacations are now looking at the situation and saying, ‘ABAC—Anything But Air Canada.’ ”

That’s the last thing the money-losing airline needs as it grapples with lower-cost rivals while being dragged down by $3.9 billion in long-term debt. As the labour disputes mount, shares of the beleaguered airline have fallen nearly 20 per cent since February and now trade at just 87 cents, compared to an IPO price of $21 just six years ago.

Nor is it likely Air Canada will climb out of the storm clouds anytime soon. While many big U.S. carriers have managed to slash employee pension plans and other labour expenses in a bid to modernize their outdated business models, Air Canada has so far been unwilling or unable to contemplate similar radical changes. And the federal government is partly to blame for the mess as it desperately tries to maintain the status quo.

It all raises the question of whether Air Canada can actually be fixed, or if it’s time for Ottawa to open the skies to newer, more competitive—and perhaps even foreign—upstarts. Even if it means clipping Air Canada’s wings in the process.

The core of Air Canada’s current problems is simple: the cost of flying passengers in its planes is greater than the prices it’s able to charge them. Despite a major restructuring in 2003 and 2004, the airline’s operating costs remain roughly 30 per cent higher than those of rival WestJet, which built its business on the successful model pioneered by Texas-based Southwest Airlines. That winning formula includes a single type of aircraft (to save on training and maintenance costs), no connecting flights (which cause expensive delays when planes have to wait for passengers) and an all-economy-class configuration (which maximizes passenger numbers).

By contrast, Air Canada flies 204 aircraft, ranging from small regional jets to Boeing 777s, and books customers on the regional carrier Jazz (now a separate company). Its own route network stretches from Goose Bay to Geneva, although passengers can effectively travel to any corner of the globe via a complex—and expensive—network of code-sharing agreements with its Star Alliance partners. With 37 brand-new Boeing 787 planes scheduled to join Air Canada’s fleet starting in 2014, it’s an impressive-looking business that generates nearly $12 billion a year in sales. Even so, Air Canada ended up with a net loss of $249 million last year. In 2010 it ended up $24 million in the red. And this was during a period when North American airlines collectively earned US$4.1 billion, according to data from the International Air Transport Association.

Air Canada’s once-dominant position is being attacked from all sides. When it emerged from bankruptcy protection in 2004, the strategy pitched to investors was to price-match WestJet in the domestic market while leaning on business-class travellers and higher-margin international flights to boost profitability. It worked for a few years. Then fuel prices soared and the economy tanked. At the same time, Porter Airlines launched in 2006 and began to steal Air Canada’s deep-pocketed business and government passengers on key routes like Toronto-Ottawa and Toronto-New York, while a new breed of aggressive, lower-cost international players like Dubai-based Emirates threaten to do the same overseas. Fred Lazar, an associate professor of economics at York University, estimates that Air Canada’s costs are as much as 50 to 60 per cent higher than some Asian and Persian Gulf carriers’ when Canada’s uncompetitive tax and airport rent policies are factored into the equation.

Since many of Air Canada’s costs are beyond its control—the airline paid roughly $3.4 billion last year for fuel and another $1 billion in airport and navigation fees—CEO Calin Rovinescu is now focused on cutting its $2 billion in annual labour expenses. His plan? Create one or more new low-cost carriers, complete with lower wages and benefits for employees, to handle Air Canada’s less profitable routes. The model is similar to the one now employed by Australia’s Qantas Airways, which uses its Jetstar subsidiary to fly a host of domestic and international routes. Qantas also has stakes in a constellation of other Jetstar-branded joint ventures, including ones in Singapore and Vietnam and soon in Japan and Hong Kong. “We remain of the view that participation in that market segment is important to the airline,” Rovinescu told analysts during a February conference call. (He declined to speak to Maclean’s.)

Not surprisingly, Rovinescu’s plan hasn’t been a big hit with Air Canada’s unionized workforce—particularly pilots. Last May, the 3,000-member Air Canada Pilots’ Association voted against a tentative agreement reached by union negotiators that included plans for the low-cost carrier. They later voted 97 per cent in favour of going on strike and turned down another “final” offer by Air Canada in March, even though it didn’t include the discount carrier plan. Strachan says many pilots remain deeply skeptical that Rovinescu’s discount carrier strategy will actually work in practice, arguing that in the case of Jetstar, “the net effect so far has been a massive offshoring of Australian jobs.”

It’s difficult to overstate the level of animosity and distrust that Air Canada workers now have for their bosses. Many feel betrayed after agreeing to over $1 billion in labour concessions during Air Canada’s 2003 restructuring, only to be asked for further cuts once those agreements expired in 2009.

Union leaders have also accused the management of ACE Aviation, Air Canada’s holding company, of stripping the airline of profitable sub-businesses in a bid to generate big returns for its private equity investors—namely New York’s Cerberus Capital Management. That includes the 2005 spinoff of loyalty program Aeroplan as an income trust, which generated $250 million in exchange for a 12.5 per cent stake. By contrast, Air Canada’s current market cap is just $241 million. It turns out that Air Canada was in large part an airline loyalty program with an airline tacked onto it.

In an attempt to repeat the magic, ACE spun off regional carrier Jazz in 2006 and Air Canada Technical Services (now Aveos) in 2007. But Aveos went bankrupt last month and left 2,600 people out of work, with CEO Joseph Kolshak blaming Air Canada for pushing it over the edge after it deferred and cancelled aircraft maintenance work. Rovinescu, meanwhile, blamed Aveos for “productivity issues” while Strachan claims Air Canada was likely paying too much for Aveos’s services because investment bankers thought that would make it appear more attractive to investors.

The unions are also furious with how well Air Canada’s top management has fared despite the airline’s dismal financial performance. Robert Milton, the CEO of holding company ACE Aviation, which still holds 11 per cent of Air Canada’s shares, has earned more than $82 million for his role in completing the various “value-enhancing transactions” for ACE’s shareholders, according to some reports. Rovinescu, who was brought aboard in 2009 after acting as Air Canada’s chief restructuring officer in 2003 and 2004, earned $4.5 million in 2010 (the most recent year for which compensation figures are available), up from $2.6 million (for nine months’ service) a year earlier. He also took home a $5-million retention bonus last month. “If compensation is an issue at Air Canada, it is in the executive suite,” stated a recent report distributed by the pilots’ union.

Though big salaries aren’t unusual for executives charged with turning around troubled companies, York’s Lazar says it sends the wrong message to employees who are asked to make sacrifices. “Senior executives could take a hit on their salaries of about 30 to 40 per cent,” he says. Lazar also accuses Air Canada’s board of sitting on its hands. “If I were advising the unions, I would demand that Air Canada get rid of its entire board and select a new one that’s going to be a little more aggressive in curbing executive compensation, and more involved in determining the strategy of the company.”

Ottawa also needs to get off the fence. Raitt’s constant meddling in Air Canada’s labour negotiations may have prevented unpopular and potentially crippling strikes that could have stranded thousands and cut off access to remote communities, but it has also reduced the pressure on the two sides to make the changes Air Canada needs to make to survive. “It just delays the inevitability of having to face the real issues and work with the unions to come up with some kind of agreement,” says Marc-David Seidel, an associate professor at the University of British Columbia’s Sauder School of Business.

One way out of this trap is to allow more competition in Canada’s airline sector, now effectively a comfortable duopoly between Air Canada and WestJet. That’s the approach the federal government has taken with the telecom industry by lowering the barriers to entry for new players and raising foreign ownership limits. Seidel argues that big U.S. carriers have been more effective at restructuring because they face a real threat from more nimble rivals like JetBlue Airways, Southwest and Virgin America. “They never really get exposed to true market forces so they’re never able to get the full ship in order,” Seidel says of Air Canada. Besides, he adds, nowhere is it written that “Air Canada has to be the airline of the future for the country. It could be several new start-up carriers that grow and that are designed for today’s competitive environment.” That could be accomplished by raising foreign ownership limits on Canadian airlines, now capped at 25 per cent voting control, or relaxing rules so that foreign carriers could fly passengers between Canadian cities, as is the case in Europe.

As refreshing as that sounds, Canadians shouldn’t get their hopes up. For the foreseeable future, we appear stuck with the prospect of watching Air Canada struggle to survive, with Ottawa standing at the bedside ready to administer life support as needed.


Air Canada’s slow descent

  1. As Ben Cherniavsky, analyst at Raymond James, recently described the 2003/2004 restructuring:

    Air Canada and its various subsidiaries would have been better off if they were not spun out from the airline under ACE Aviation.“From a financial re-engineering perspective, they accomplished a great deal. From a business restructuring perspective, they accomplished very little, if anything.”He described the ACE Aviation experiment as a “shell game:
    ”It not only created entities, like Chorus Aviation Inc., Air Canada’s regional affiliate, and Aveos, that had few opportunities, but it also saddled Air Canada with uncompetitive long-term contracts with those subsidiaries that boosted their value when they were spun off as stand-alone entities.”

    Calin Rovinescu was the chief architect of the 2003/2004 restructuring.  It was a failed experiment; nevertheless, he is now supposed to be the man who is going to extract Air Canada out of the mess he created?  Other than collecting a $5 Million bonus, what has he achieved thus far?

    You can only blame the employees for so long before it catches up with you.  If Air Canada is to survive, changes have to be made at the top.

    • sorry Wickett, but this was not a failed experiment. It was brilliant. Unlike the workers that have to slave for 45 years to try to raise a family and have a decent modest life, these businessmen are only around for a few years and have to milk a company for all they can. They don’t care about the long term survival of a company or the tens of thousands of families they destroy or even the passenger’s satisfaction and safety. Air Canada carries 3.9 billion in debt and management and executives of ACE earned 4 billion in the last 10 years. Do we even have an ethics committee in Canada?

      btw: Macleans, very well written report. You should be getting a call from Air Canada soon telling you to remove it like they did to Lang & O’leary.      

  2. Calin Rovinescu -Air Canada’s CEO- is an insolvency & restructuring specialist:

    When you have a hammer, everything looks like a nail.

  3. Air Canada and aviation is treated as a cash cow by the government in Canada. Air Canada’s labour costs are the same as Westjet minus a large management pool and are very competitive when compared with the US majors or European carriers. The main problem is and always has been taxes and fees in aviation in Canada.
    Jet Blue and Virgin America tried and pulled out for just that reason.

    • Exactly how big IS West Jet’s pension plan?  Oh, I forgot they don’t have one.  

      • WJA’s pension plan is self directed.  You buy a share, the company matches up to 20% of your salary.  You can sell it at a profit in one year and do what you want with the cash.

        People who bought last year when the shares were $11 got in at $5.50.  They can sell this year at about $14.  If they bought 1,000 shares last year, they pocket $8,500, and pay tax on the capital gains, which is about half the rate of taxes on income.

        Even if the stock was flat, they’d pocket $6,500. 

        Stick around for 20+ years, (the company is 16 years old already), and with even half decent investing, long time employees have a nice nest egg to retire on, just like 16 year employees of AIr Canada.

        Guess what?  No matter what happens, people with 30 years on the job at Air Canada are going to have / should have, a higher pension coming to them, regardless of the source, than someone who’s been at a company for half that length of time…

        Oh yea.  WestJet employees have never had to worry about layoffs, going on strike and having the entire country hating the place they work.

        Did YOU put $8,500 in your RRSP last year?

        • Hard to put anything into an RRSP when your pension contributions leave no room – ZERO – to put money into your RRSP or your spouse’s RRSP. And we bought shares in our company too – and now I have a $50,000 Capital Gains LOSS – that worked out real well.

    • JetBlue has never bothered with Canada.  They have had all the approvals necessary to launch service for years.  They could start tomorrow if they wanted.

  4. From the 2011 financial results, we see the average Air Canada employee costs about 2% more per equivalent full time employee than the average WestJet employee (INCLUDING pensions). Yet each Air Canada employee generates 23% more revenue than each WestJet employee.

    Clearly the cost problems at Air Canada are not a result of the employees. Probably why they no longer wish to take the heat for a hugely bloated and greedy management team! When Air Canada can reduce the number of Managers to the level of WestJet, per revenue passenger mile, then you will see profits at Air Canada.

    The employees at Air Canada could work for free, and still not pay for huge management salaries and numbers!

    • I have been with Air Canada 26 years and seen most of my co-workers continue to dig in and work harder than ever before even after they have not seen a raise for 10 years. Between stockholder profits and management bonuses based on zero growth, I agree with you that the upper management model is very much broken.

       The expierienced workforce that are close to the operation and understand it know full well that Management can be drastically reduced and the company still fuction at peak performance without a good portion of them(or return to profitability)… In a nutshell if they cut all the unnecessary management and upper management positions then we will see a improvement as well as managerial tasks given to the workforce that know the operation. my co-workers are not looking for huge raises like their unproductive management and upper management who oversee what they do and make more and more money. I really have not seen many changes in the operation only that my co-workers are working harder and are more effective than ever before. Most of the old union lazy boys have gone.We are a low paid workforce now statistically and still we work very hard 

      Again the senior workforce has huge expierience, much more that high paid managers. A new(low cost) board of directors will solve the problem…The new hires at Air Canada start at just above minimun wage and take years to get to mediocre..and for what I see work harder than the older senoir guys….. Air Canada solved the workforce pay model back in 2003 by cutting wages and benefits and then grew a fat upper management  cat in the last 9 years, problem is there is too much buddy buddy at the top and a nonrespective entity has to jump in and clean house where the red ink continues to spill. I see High paid directors doing nothing day in and day out while the workiers continue the get the job done day in and day out….I am all about productive and abitious work ethic from both sides…Flight attendants who give excellent service. Pilots that are world class and terminal and ground crew operations that are flat out the worlds best. These groups require vertually zero babysitters because they know their jobs. We need management… just not as many 

  5. Very simply, I won’t be booking any flights on Air Canada for the foreseeable future, unless I am going somewhere where there is no choice.  I’ll use my Aeroplan points on other Star Alliance airlines such as United or ANA.  Bravo Westjet and Porter for providing some competition and roll on, open skies.

    • That’s like saying I’m not going to be a Leafs fan until they start winning.

       Air Canada’s service is tops… Voted best in North America(obviously not by yourself) but more people than you feel differently Westjet and Porter have an excellent model, great companies. I applaud all they do to set an effective example based on other successful models(Southwest etc..).Just don’t ever dismiss that they have thier issues too. Remember they have regional business models where Air Canadas scope is much larger. The periodic traveller always says they wont fly AC….

      .If you talk to the serious traveller who want the regional and International scope you will find that a consistent traveller feels differently and Fly AC… But not always.Competition is great!!…. Lack of bigger thinking is your problem, and thinking that if you go with another airline you will in fact hurt AC is comical… Wether you decide to book AC or not is not the issue.. The plane will go without you full of happy other satisfied travellers. You need to get on about 50 planes a year to grasp what I am saying… So take your points offshore if you must.

  6. Two key things do not get mentioned in this article.
    1.  The reason that AC flys all over Canada (to every nook and cranny) is because they are legilstated to as part of the Air Canada Act during privatization.  Yes they are stretched thin because they are serving destinations that AC doesn’t want to service and are money losers.  WJ or any other start-up could pick and choose their routes.  Other aspects of the Air Canada Act are costly too…..3 maitenance hangers, French service EVERYWHERE.

    2.  When people say Open Skies they don’t seem to think that yeah sure an American or other country’s airline will come in but will only service main, money making routes such as Vancouver to Toronto.  They won’t be flying to Saskatoon, Gander, Moncton etc.  And as Virgin and Jet Blue already have landing rights at Pearson which they don’t use because the GTAA has some of the highest landing fees in the world why would they want to fly Canadian city to Canadian city even if changing the rules permitted them to do so.  American pilots typically get paid more, all the landing and NavCan fees will be the same, catering costs, layover hotel costs etc. will be the same and starting FAs and Rampies at AC already are at min. wage so I don’t why another airline would feel that these routes would be profitable to them.  How can another airline do it cheaper?  And for those who think ticket prices will be similar to those in the states, WRONG.  When you look at the actually ticket cost in Canada (AC or WJ) you will see that the airline actually charges very little and that the bulk is taxes/fees collected by the airline for the government.  In the US the Federal government pays those for the consumer.  Obviously they won’t do that for a route that is from a Canadian city to another Canadian city and so this new foreign owned airline is going to be charging you all the same. 

    • Please provide an example of a route Air Canada is “forced” to fly? 

      There are none.  The market was deregulated in 1987 and the restrictions on flying in Northern Domestic Airspace were lifted within the last 12 years.  AIr Canada has pulled out of Iqualiut, Abbotsford and Hamilton without any issue over the past 10 years.

      Air Canada apologists are always whining about having to fly money losing routes.  Like ALL other airlines, Air Canada can drop any route they want with 6 months notice.  Air Canada has chosen to continue to fly to everywhere, all the time to ensure they have market dominance, no matter how much money they lose doing it.

      WestJet is adding at least 40 turbo props into the fleet so they can economically offer flights into smaller markets.  They are doing that not because they are forced to by anyone, but because with their low costs, they can make money with low fares where others just create a sea of red ink.

  7. Why don’t you ask how much money have the exec’s at Air Canada received in bonuses over the last 10 years? It seems their bonuses are not tied to company performance but on whether they stick around. 

    • 4 billion…in 2 days, the shareholders of ACE will split up the last 300 million and desolve. After that, expect a big announcement from air canada. it’s criminal. 

    • I GUARANTEE there will be a rather large managerial and upper management reduction at Air Canada by 3rd quarter if not sooner…. The people working the true operational day to day stuff will carry on without a ripple The crews that run the true model (Pilots, Flight attendants, Terminal staff, Ramp crews) already took a huge pay and benefiut haircut in 03.. These folks work thier cans off still with no real increase in pay/benefits cut from 10 years ago and zero raises from that point to present. When a hard working group sees execs bagging and stealing cash and leaving the company with no forward positive changes or policies  then it’s time for a true ethics board to jump on this plane and put thier egos aside to find true long term investors who don’t want fast cash to fuel thier other losing investments.. We are an essential service. That was proven by our Goverment back to work ruling. If Porter folded up tomorrow AC would take on the extra…Just like all the others C3, Oddysey, Jetsgo,Nationair…need I go on. I agree, bring on the competition with a low cost Management and exec model like the real workers at Air Canada have done and we will kick some ass.. Regionally and internationally. 

  8. My wife and I recently flew United redeeming Aeroplan points. United was a poor cousin to Air Canada in almost every respect. It would be a shame if AC went under, IMHO

  9. Last time I checked, Air Canada shares were down to 85 cents and their profit per share was -91 cents. Nobody needs a calculator to tell you that it’s all over again.

  10. As a former AC/Aveos employee, I’m not going to re-hash everything, I’ll just say that it always or somewhat suggested that we were the enemy, the cause of all calamities, and as for the maintenance division, how does one motivate a work force that know their future is gone?  But yet Calin has the audacity to say that Aveos had productivity issues, Calin made us into dead men walking, may it be suggested that he look into a mirror and see the real enemy.

  11. What “remote communities” does Air Canada Serve?? 

    • NONE!  It’s done by Jazz!  Or now Air Canada Express….

      • Exactly ! and even at that Jazz or Georgian or CMA etc don’t even serve the “remote communities”. Those are served by many small regional carriers like Calm Air or First Air.  The Canadian traveler has many options domestically to get around not just WestJet, If Air Canada where to fail and completely disappear (not likely) there would be short term pain I agree but not chaos. We have many options and those companies would love to get a piece of the actions after all last I checked we live in a free market economy in a democracy and airlines like WestJet, Air Transat, Sunwing , Canjet, Sky Regional, Georgian, CMA, Pacific Coastal, Hawk Air, Flair Air, Air North, Canadian North, First Air, Perimeter, Bearskin, Provincial, Calm Air just to name a few would no doubt pick up capacity in a hurry and ultimately the consumer will win. Travelers to the US and Internationally have many options from the major centers in Canada to go anywhere in the world. With all the international airlines that serve the likes of YVR YYC  YYZ YUL most Canadians could fly on any of the above mentioned airlines and connect to anywhere in the world. After the smoke clears I know some of our domestic carriers would get into the long haul wide body aircraft market and no doubt flourish. Enough government intervention and interference in this industry.

  12. By the way JETSTAR pilots get paid MORE than Air Canada pilots…..
    They have more vacation
    They have profit sharing
    They get retention bonuses
    They get better per diems

    I wish the reporters and general public would do their homework first!!!!!!!

    The problem with Air Canada is the executive and BOD compensation as well as the corporate structure…..27 VP’s and hundreds of Directors and Managers (WestJet 5-6 VP’s)…..its ridiculous especially when you increase your salary and pay yourself bonuses ask for more concessions from the employees when the company loses money and the share price tanks!  Can people not see that THIS is the problem and that it is wrong!

    The other problem is that the “unlicensed union workers” are making considerably more than market rates!  When was the last time you saw a nurse make more than a doctor!???????  There are many flight attendants that make more than the pilot flying the plane!  There is something fundamentally wrong with this.

    I think people need a reality check.

  13. Fact check:  WestJet an important factor in WestJet’s success is the fact that they have always offered connecting flights since the first flight took off on Feb 29 1996.  About 45% of the people you see on your WJ flight are either connecting or through guests. 

  14. Princess Diana is alive and well.

  15. The Way out is to Fire the Management.

    They show no ability to manage their people.

    They go out of their way to alienate their people and it shows.

  16. It is interesting reading the very well commentated article, especially due to the fact that Australia has been through this recently. Alan Joyce recently removed Qantas from the skies around the world, the effectively locked out the entire work force, regardless of weather they were in dispute with that groups union or not.

    As has been proven in the past Labor Unions are only there to benefit themselves, they are not there for the workers, they are truly only there for themselves. Which i’ll drarw attention to;

    the Union workforce at QF (QANTAS) was continuing to walk out on work, they were shutting down operations for 2 – 3 hours a day, walking around the airport trying to get support. Which they are protected and able to do – unfortunately like most strikes it will generally not get far apart from disrupting customers, and turning more customers against the cause.

    The unions in this case then decided right, we’ll go on strike for 24 hours, they gave the airline 3 days notice that this may happen, to which Alan Joyce acted ahead of and shut down the entire airline. Grounding the entire fleet, planes already loaded with passengers were taken back to the terminals unloaded and customers left stranded.

    Rough Tactics you think?

    The unions tactics then switch, even though the union had been wrecking the company bit by bit, QF had taken far greater action, and now the Union stated that QF was destroying the brand – it was tit for tat.

    Take the job away from the union, the employees will soon consider the pay check more important to the unions, I know I could not survive locked out of work for a week.

    What action needs to be taken, I believe AC need to be shut down, they need to file for protection, and restructure. Fire the entire workforce and rehire 1 by one. I am sure quick smart in this industry climate the majority will take the same job back with less pay once the pay check runs away.

  17. Enough of comparing Westjet to Air Canada…totally different field. Air Canada is flying all over the world, which required more than one type of airplane, and way bigger maintenance organization. It is just not the same type of business at all. Also, talking about pilots….its funny how people just want to pay less and less for the plane ticket..I am sorry.but, when the plane ticket are the same price..if not cheaper that they were many years ago…with the fuel price almost double…as well as all the other cost…how do you expect a aviation cie to be healthy. Look at all the cost…..just deicing one full 777 would almost take all the profit of that flight……wow..good business guys. You want to lower the wages and conditions…well…I just hope you will all get the pilots with the experiences and qualification that comes with those lower conditions….YOU customer want it all….a cheap price..with the most experience pilots…I am sorry..but this is not how it work. Also, hard to believe you are talking about foreign upstart…wow..what a way to encourage Canadian economy…..I am telling you..the world is sick…..really sick…..

  18. Lets just let Air Canada go out of business. The sooner the better so we can replace this management team of fools. A new airline can start and lets open the doors to world competition. Emirates can fly daily and more tourists can visit Canada in the long run it will be better for Canada.

  19. The Canadian Government has themselves to blame for this mess….. By Forcing Air Canada to buy Canadian Airlines at the turn of the century it completely handcuffed the airline and caused huge internal conflicts merging the two companies.. If they would have allowed American Airlines or The Onex deal to go through im sure both airlines would be in better shape than AC is today

  20. There is no shortage of blame with anythig that concerns Air Canada. The management is highly at fault for taking big bonuses. The unions are at fault for rules that cripple the airline and strikes that turn away more and more passengers. The government is at fault for meddling in the operations of a private company and keeping out competition.
    The Air Canada workforce both unions and non-unions do nothing else but blame one another. They are constantly in the courts battling one another. This does nothing else but create animosity, deepen the pockets of lawyers and create bad publicity.
    Air Canada has one of the newest and best fleets in North America. They have the same Boeing 777s as Emirates, Qatar and Singapore and yet they can’t compete internationally. They have brand new Embraer aircraft for short haul flights and yet they can’t compete locally without losing money.
    Everyone should look in the mirror and see how they can each clean up this mess.