Air Canada to Fundamentally Restructure | Aero-News Network
Aero-News Network
RSS icon RSS feed
podcast icon MP3 podcast
Subscribe Aero-News e-mail Newsletter Subscribe

Airborne Unlimited -- Most Recent Daily Episodes

Episode Date

Airborne-Monday

Airborne-Tuesday

Airborne-Wednesday Airborne-Thursday

Airborne-Friday

Airborne On YouTube

Airborne-Unlimited-05.13.24

Airborne-NextGen-05.07.24

Airborne-Unlimited-05.08.24 Airborne-FlightTraining-05.09.24

Airborne-Unlimited-05.10.24

Fri, Feb 07, 2003

Air Canada to Fundamentally Restructure

Wanna Buy Jazz?

Air Canada, after posting encouraging, profitable quarters in Q2 and Q3, rang up a crummy fourth quarter, so bad that the year's posting was in the red. The airline, facing the worst, says it needs to cut as much as 20% of its workforce, and also says it plans to sell off some operating divisions, the "Air Canada Family."

People are expensive.

Air Canada revealed to the Globe and Mail that, "Air Canada's salaries and benefits represent 31 per cent of our operating costs," according to the carrier's president, Robert Milton. He added, "We must do things differently and take additional measures."

Those measures include talking with its unions, to see if the union bosses will give up members' pay and benefits in return for an iffy promise of long-term survival; and more-concrete measures, like layoffs and spinoffs. As crude oil prices are expected to rise, once war in Iraq becomes reality, there is even greater pressure on carriers to cut operating costs. Passengers aren't beating on the carriers' doors, and taxes won't likely come down, so "everything else" -- especially jobs -- will be led to the sacrificial altar.

2002 Q4 even worse than 2001's

Though nobody thought it possible to trump 2001's Q4 losses, Air Canada's $364 million ($CDN) in 2002 was 31% worse than 2001's identical calendar period -- even in spite of a huge, new cost-conscious movement. Things aren't looking appreciably better, either, as CEO Milton told employees in December that Air Canada, along with her sisters in the US, are facing "...what is perhaps the worst revenue environment ever."

The year, overall, was better.

Although Air Canada's Q4 was a real downer, the airline posted a healthier year than 2001, losing $428 million ($90 million of that was posted by Jazz), versus 2001's staggering $1.32 billion -- and revenues actually increased by roughly a hundred million dollars, or nearly five percent.

Regionals' futures look worse.

Milton noted, "In Canada, we're continuing to see growth in competitive capacity from low cost carriers in a flat market. There is no sign of recovery in the regional market." Later came the leak that Jazz is on the block, along with previously-announced Air Canada plans to divest a large portion of its Aeroplan (frequent flier program) division, and nearly half (49%) of its technical services operation, in addition to the offer for sale of the airline's ground-handling ops.

Additional rumors still circulate that Air Canada may turn its cargo operation into a separate division; there are no solid rumors, though, that the cargo shipping business will be spun off.

FMI: www.aircanada.ca

Advertisement

More News

Airborne 05.10.24: Icon Auction, Drunk MedEvac Pilot, Bell ALFA

Also: SkyReach Parts Support, Piper Service Ctr, Airliner Near-Miss, Airshow London The Judge overseeing Icon's convoluted Chapter 11 process has approved $9 million in Chapter 11 >[...]

ANN's Daily Aero-Term (05.13.24): ILS PRM Approach

ILS PRM Approach An instrument landing system (ILS) approach conducted to parallel runways whose extended centerlines are separated by less than 4,300 feet and at least 3,000 feet >[...]

ANN's Daily Aero-Linx (05.13.24)

Aero Linx: FlyPups FlyPups transports dogs from desperate situations to fosters, no-kill shelters, and fur-ever homes. We deliver trained dogs to veterans for service and companion>[...]

Airborne-NextGen 05.07.24: AI-Piloted F-16, AgEagle, 1st 2 WorldView Sats

Also: Skydio Chief, Uncle Sam Sues, Dash 7 magniX, OR UAS Accelerator US Secretary of the Air Force Frank Kendall was given a turn around the patch in the 'X-62A Variable In-flight>[...]

Airborne 05.08.24: Denali Update, Dad-Daughter Gyro, Lake SAIB

Also: NBAA on FAA Reauth, DJI AG Drones, HI Insurance Bill Defeated, SPSA Airtankers The Beechcraft Denali continues moving forward towards certification, having received its FAA T>[...]

blog comments powered by Disqus



Advertisement

Advertisement

Podcasts

Advertisement

© 2007 - 2024 Web Development & Design by Pauli Systems, LC