Tag Archives: Air Canada

Air Canada announces its intention to adopt the Canada Emergency Wage Subsidy for the benefit of its 36,000 Canadian-based employees

Air Canada made this announcement:

On March 30, 2020, as part of an overall cost reduction program, Air Canada announced that its workforce in Canada will be temporarily reduced by approximately 50 per cent, or 16,500 jobs, as a result of the COVID-19 crisis and the imposition of global travel restrictions.

On April 1, 2020, the Government of Canada announced the Canada Emergency Wage Subsidy (CEWS) in order to help employers keep and/or return Canadian-based employees to payrolls for the Program Term of March 15, 2020 to June 6, 2020 in response to challenges posed by COVID-19. Details of the CEWS are still outstanding, but are intended to generally reimburse employers suffering revenue declines exceeding 30 per cent, which is the case for Air Canada. As a result of the crisis, Air Canada has abruptly reduced its seat capacity by 85 to 90 per cent and is incurring significant revenue losses. Any near-term recovery is reliant on the lifting of domestic and international travel restrictions and return of passenger traffic.

Following an analysis of publicly available information on the CEWS, discussions with Department of Finance officials on certain questions of interpretation, and subject to its adoption into law substantially as announced, Air Canada intends to adopt the CEWS for the benefit of its 36,000 Canadian-based employee workforce. Air Canada’s intention to adopt the CEWS has also received the support of all of its Canadian-based unions: ACPA, CALDA, CUPE, IAMAW and Unifor.

As Air Canada (including subsidiaries Air Canada Rouge and Air Canada Vacations) has suffered a drop in consolidated revenues of more than 30 per cent and expects to continue to do so for the Program Term, it will apply for the CEWS retroactively to March 15, 2020 and retain or return affected employees to its payroll for the Program Term.

In addition to the temporary workforce reductions, other measures implemented by Air Canada include:

  • A company-wide cost reduction and capital deferral program, now estimated to be at least $750 million for the year, increased from the previous target of $500 million.
  • Drawing down operating lines of credit of approximately $1 billion, to provide additional liquidity.
  • Calin Rovinescu, Air Canada’s President and Chief Executive Officer, and Michael Rousseau, Air Canada’s Deputy Chief Executive and Chief Financial Officer, have agreed to forgo 100 per cent of their salary. Senior Executives will forgo between 25 per cent to 50 per cent of their salary while members of Air Canada’s Board of Directors have agreed to a 25 per cent reduction. All other Air Canada managers will have their salaries reduced 10 per cent for the entire second quarter.
  • Air Canada suspended its share repurchase program in early March 2020.

“The Canada Emergency Wage Subsidy is an extremely important program to help employees and employers during this time of crisis, and as one of Canada’s largest employers most affected by COVID-19, we want to acknowledge the leadership of the Government of Canada in introducing it,” said Calin Rovinescu, President and Chief Executive Officer at Air Canada.

“While our seat capacity and operations have decreased by more than 90 per cent overnight, we are trying to keep as many of our employees as possible during the crisis and this measure will certainly help. Depending on wage levels, many furloughed employees will get a somewhat higher amount under CEWS than they would otherwise receive from Employment Insurance payments plus they will maintain their health insurance and other benefits and stay more connected to our company during the Program Period. Once the crisis passes and passenger demand increases, we look forward to returning as many employees as possible to active status as we resume normal operations,” concluded Mr. Rovinescu.

Air Canada aircraft photo gallery:

Air Canada announces the extension of Altitude Status for all members

Air Canada has announced several updates for Altitude members to ensure their status remains in effect until they are able to resume flying. The changes include the extension of current status until the end of 2021, the ability to share any status achieved in 2020 with a loved one, and new opportunities to qualify for Altitude status and earn Aeroplan Miles from home.

“Loyalty is a two-way street – certainly in good times, but especially so in hard times. Altitude members have shown outstanding commitment to Air Canada, and to provide some certainty during these uncertain times, we are extending members’ current Altitude status to the end of 2021. We’re also making it easier to share status with a loved one, and earn both status and Aeroplan miles from home.” said Mark Nasr, Vice President, Loyalty and eCommerce at Air Canada. “The entire Air Canada team is looking forward to welcoming all customers back in the skies when the time is right.”

In order to provide greater ease and flexibility, changes for Air Canada Altitude customers include:

Automatic extension of 2020 Altitude status
All Altitude status for 2020 will automatically be extended through to the end of 2021. Should a member reach a higher status before the end of this year, they will enjoy it upon qualification, and maintain it through 2021 as well.

Share Altitude status with friends and family
Since Altitude status is secure through 2021, if a member has already achieved status for next year, or does so by the end of 2020, they can gift it to a friend or family member.

Continue to earn Altitude status and Aeroplan Miles – from home
While at home, a member can still earn Aeroplan Miles, progress towards Altitude status and make a difference with their miles. From now until April 30, for every five Aeroplan Miles a member donates to a charity engaged in fighting the COVID-19 crisis, they will receive one Altitude Qualifying Mile – up to a maximum of 25,000 AQM – all of which count towards 2021 status for the member, and a loved one.

These improvements come in addition to other changes for all Aeroplan members already announced:

Cancel any Flight Reward free of charge
Until April 30, all members can cancel any Flight Reward free of charge and receive all of their Aeroplan Miles back in their account, plus a full refund of any associated taxes, fees and surcharges on the unused value of their travel. This is available for flight itineraries departing any date in the future.

Temporary pause to expiration of Aeroplan Miles
We have paused expiry until May 14, 2020. This means that between now and May 14, any Aeroplan Miles which would have expired will not. Effective May 15, our normal expiration policy will once again apply, meaning that miles will expire if an eligible transaction has not been completed prior to this date.

Air Canada aircraft photo gallery:

Canadians continue to fly back home with Air Canada

Air Canada announced today that, in collaboration with the Government of Canada, it will operate its first special flights from Bogota and Buenos Aires. All flights are operated in compliance with Government of Canada health and safety requirements for air passengers entering the country. Additional flights from Algiers and Lima are also planned to depart in the coming days:

Algiers

Air Canada is scheduled to operate an additional special flight on April 4, 2020.

Bogota

Air Canada is scheduled to operate a special flight on April 3, 2020.

Buenos Aires

Air Canada is scheduled to operate a special flight on April 5, 2020.

Lima

Air Canada is scheduled to operate additional special flights on April 2, 2020 and April 4, 2020.

Since March 21, Air Canada has operated 13 special flights in collaboration with the Government of Canada to bring back Canadians home.

  • MoroccoMarch 21, 23, 25
  • PeruMarch 24, 26, 27, April 1
  • EcuadorMarch 25, 27, 29, 31
  • SpainMarch 25
  • AlgeriaMarch 31

Air Canada brings home about 8,000 passengers between April 1, 2020 and April 3, 2020

Air Canada continues to operate on a reduced network following restrictions imposed by governments around the world. Its operations remain focused on bringing Canadians back home.

Photos: Air Canada. Our first special flight from Algeria has landed safely in Montreal, connecting Canadians with their family and friends.

Over the period between April 1, 2020 and April 3, 2020, Air Canada is carrying approximately 8,000 passengers back to Canada on 113 flights from Asia, Europe, Caribbean/South America and the United States. On April 2, 2020, Air Canada is carrying home 2,500 passengers.

Air Canada aircraft photo gallery:

Air Canada will reduce capacity by 85-90% in the second quarter

Air Canada made this announcement:

Air Canada said today that due to the unprecedented impact of Covid-19 upon its business, the airline will reduce capacity for the second quarter of 2020 by 85%-90% compared to last year’s Q2 and will place 15,200 members of its unionized workforce on Off Duty Status and furlough about 1,300 managers. The workplace reductions will be effective on or about April 3 and are intended to be temporary.

“The unpredictable extent and duration of the Covid-19 pandemic requires a significant overall response.  To furlough such a large proportion of our employees is an extremely painful decision but one we are required to take given our dramatically smaller operations for the next while.  It will help ensure that Air Canada can manage through this crisis that is affecting airlines everywhere. We believe that the temporary nature of these reductions, many achieved through voluntary programs, combined with other mitigation measures, will position us to restore regular operations as soon as the situation improves,” said Calin Rovinescu, President and Chief Executive.

“I understand and regret the impact this will have upon our employees and their families. I thank all of our employees, as well as union leaders, for working with us constructively to quickly implement these measures”.

In addition to the temporary workforce reductions, other measures implemented by Air Canada include:

  • A company-wide cost reduction and capital deferral program, targeting at least $500 million.
  • Drawing down operating lines of credit of approximately $1 billion, to provide additional liquidity.
  • Mr. Rovinescu, Air Canada’s President & Chief Executive Officer, and Michael Rousseau, Air Canada’s Deputy Chief Executive and Chief Financial Officer, have agreed to forgo 100% of their salary. Senior Executives will forgo between 25% – 50% of their salary while members of Air Canada’s Board of Directors have agreed to a 25% reduction. All other Air Canada managers will have their salaries reduced 10% for the entire Second Quarter.
  • Air Canada suspended its share repurchase program effective March 2, 2020.

Earlier today, the Prime Minister of Canada announced a new wage subsidy program the details of which will be communicated later in the week and Air Canada will assess the impact of this on its mitigation plans. In addition, the Prime Minister also publicly acknowledged that the crisis faced by industries such as airlines will need additional help beyond wage subsidy and loan credit measures already announced by the federal government.

Subject to further government restrictions, while the crisis is ongoing Air Canada intends to continue to serve a small number of international and U.S. trans-border destinations from select Canadian cities after April 1, 2020 in addition to a reduced network in Canada.  In addition, Air Canada will also continue to operate special international flights in collaboration with the Government of Canada to repatriate Canadians abroad as well as cargo-only flights to ensure the continued movement of essential goods, including medical supplies.

Air Canada aircraft photo gallery:

Competition Bureau issues report outlining competition concerns with Air Canada’s proposed acquisition of Transat

The Competition Bureau has issued this report:

The Competition Bureau announced on March 27 it has concluded that Air Canada’s proposed acquisition of Transat (Air Transat) is likely to result in a substantial lessening or prevention of competition in the sale of air travel or vacation packages to Canadians.

The Bureau’s concerns are outlined in a report delivered to the Minister of Transport by the Commissioner of Competition. The report will inform Transport Canada’s public interest review of the proposed transaction as it relates to national transportation.

Eliminating the rivalry between these airlines would result in increased prices, less choice, decreases in service and a significant reduction in travel by Canadians on a variety of routes where their existing networks overlap.

The Bureau’s analysis determined that the effects of the transaction would apply to 83 routes, including:

  • 49 overlapping routes between Canada and Europe; and
  • 34 overlapping routes between Canada and sun destinations in Florida, Mexico, Central America, and the Caribbean.

The transaction also represents a merger of the only two carriers offering nonstop service on 22 of these routes.

Our assessment is based upon a forward-looking analysis using data and information collected prior to the current COVID-19 pandemic. The Bureau recognizes that the impact of these events on the Canadian airline industry appear to be significant in the near term. The ultimate impact of these events may be relevant to the Bureau’s views on the proposed transaction but it is impossible to know the full extent and duration of any impact at this time.

Transport Canada has until May 2, 2020 to complete its public interest assessment and provide it to the Minister. The final decision regarding the proposed transaction will be made by the Governor in Council (Cabinet) based on a recommendation from the Minister.

Quick facts

  • Air Canada and Transat operate two of Canada’s four largest airlines and primary integrated tour operators providing vacation offerings to Canadians.
  • On August 26, 2019, the Minister of Transport started a public interest review of the proposed merger under subsection 53.1(5) of the Canada Transportation Act (CTA). As part of any such public interest review, the Commissioner of Competition is required to provide a report to the Minister on any concerns regarding potential prevention or lessening of competition that may occur as a result of the transaction.
  • Under the CTA, the Commissioner is also to provide an assessment to the Minister of the adequacy of any undertakings that may be proposed by the merging parties to address competition concerns raised in his report.
  • This is the second time the Commissioner provided a report to the Minister as part of a public interest review as it relates to national transportation.

Canadians continue to fly back home with Air Canada

Air Canada has made this announcement:

Air Canada announced today that, in collaboration with the Government of Canada, it will operate its first special flight from Algiers on Tuesday. Additional flights from Peru and Ecuador are also scheduled to depart in the coming days.

Algiers

The flight from Algiers to Montreal is currently scheduled to operate on March 31 on an Airbus A330 with 292 seats.

Quito

Air Canada Rouge will operate two additional flights on March 29 and March 31, on 282-seat wide body Boeing 767 aircraft.

Lima

Air Canada will operate one extra flight on April 1 on a 400-seat wide-body aircraft.

Canadians abroad must register with Global Affairs Canada to book their seat. For any emergency help, travelers can also contact sos@international.gc.ca.

Since March 21, Air Canada has operated nine special flights in collaboration with the Government of Canada to bring back Canadians home.

  • MoroccoMarch 21, 23, 25
  • PeruMarch 24, 26, 27
  • EcuadorMarch 25, 27
  • SpainMarch 25

Nearly 8,500 passengers in one day

Air Canada continues to operate on a reduced network following restrictions imposed by governments around the world. Its operations remain focused on bringing Canadians back home.

On March 28 alone, Air Canada is operating 59 flights back to Canada carrying approximately 8,500 passengers. Over the period between March 27 to 29, Air Canada will carry approximately 22,500 passengers back to Canada on 175 flights from Asia, Europe, Caribbean/South America and the United States.

Note: Air Canada later updated this announcement with this statement:

Updated text: The April 1st flight to Peru is still being planned and not yet currently scheduled.

Air Canada aircraft photo gallery:

Air Canada begins operating cargo-only flights

Air Canada made this announcement:

Air Canada said today that through its Air Canada Cargo division it has begun using its aircraft to operate cargo-only flights to Europe, with other flights planned for Latin America and South America. The aircraft on these flights carry no passengers but move time-sensitive shipments, including medical supplies to combat COVID-19, and goods to support the global economy.

“Air Canada Cargo has long served as a vital link in global supply chains and with the disruption arising from the COVID-19 pandemic our capabilities are more important than ever. Although we have announced very significant temporary capacity reductions and our passenger flights are largely dedicated to bringing Canadians home, Air Canada’s aircraft and our expertise in handling cargo are valuable assets that we can use to move medical supplies and other essential goods to keep the world economy going. We have already begun flights to Europe, and we are planning to expand this program to Latin America and South America, as well as within Canada, including remote communities using Air Canada Express aircraft. In addition to providing a much-needed service, these cargo-only flights are also supporting jobs at Air Canada,” said Tim Strauss, Vice President of Cargo, at Air Canada.

The first cargo-only flights departed from Toronto this past week for Frankfurt, London and Amsterdam, which are all both important business centers and connection points for onward cargo shipments. The flights were operated using Boeing 787 aircraft capable of carrying 35 tonnes of cargo, the equivalent of about 80 grand pianos. Shippers and freight forwarders using the service are charged a flat rate for both directions and Air Canada Cargo is also introducing a fractional program, so shippers who do not require a whole aircraft can book space. The arrangements with the shippers and freight forwarders contain clear provisions to ensure that these essential goods are being sold at fair market rates and to authorized suppliers.

Air Canada Cargo is now exploring opportunities to offer this service domestically. It is working with various governments to assess the demand and assist in moving relief goods from multiple markets within Canada. This includes using smaller Air Canada Express regional aircraft to operate to less-well served, smaller or remote regions in Canada with medical and other emergency supplies in support of local governments.

Air Canada does not operate cargo aircraft, instead its Air Canada Cargo division manages and markets excess belly space on the airline’s regular passenger flights for shippers operating worldwide. To facilitate the cargo-only flights, Air Canada Cargo has created five, segment-specific sales teams to focus on the unique needs of the customers at different levels in the supply chain.

Air Canada aircraft photo gallery: