Air Canada prepares for market downturn

Article Abstract:

Air Canada of Montreal, Quebec, is aiming for a decline in overall costs and a shifting to flexibility as a preparation for an inevitable market downturn in Canada. The performance of the company has remarkedly picked since the last recession five years ago to having 62% of the domestic market. Air Canada also controls 69% of the traffic through Toronto, Ontario, and 45% of traffic to the US, as well as raised its profit margin by 8.9% in the first quarter 1998 with C$1.2 billion in cash and available credits as of June 1998. Air Canada CFO Rob Peterson said the airline is juggling its fleet to minimize the impact on an abrupt decrease in passenger traffic with plan to retire six of its oldest Boeing 747 jumbo jets as soon as it can replace them with Airbus A340s.

Comment:

Aims for a decline in overall costs and a shifting to flexibility as a preparation for an inevitable market downturn in Canada

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Air Canada to combine two regional airlines in east

Article Abstract:

Air Canada, a Montreal, Quebec-based airline, is considering merging the operations of two of its regional airlines, Air Nova Inc. of Halifax, Nova Scotia, and Air Alliance of Quebec City, Quebec. The proposed move, which is still in its early stage, will create a single operation with almost C$300 million in annual revenue and routes in the entire Eastern Canada. Air Alliance spokesperson Lucie Francoeur projects the new airline will be able to reduce operating costs through economies of scale and by cutting duplicating jobs. Meanwhile, Air Nova spokesperson Jennifer Doyle expects the new airline to hire more people, instead of cutting jobs.

Comment:

Is considering merging the operations of two of its regional airlines, Air Nova Inc of Nova Scotia, & Air Alliance of Quebec

Acquisitions & mergers, Scheduled Passenger Air Transportation, Domestic Scheduled Air Service, Nova Scotia, Domestic airlines, Air Alliance, Air Nova Inc.

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Strike costly for Air Canada

Article Abstract:

Montreal, Quebec-based Air Canada's earnings forecast for its fiscal 1998 has been downgraded by analysts by 30 cents per share. The reformation of the air transportation services provider's earnings prediction was spurred by the more than C$200 million in losses incurred by the air carrier as a result of the strike staged by its pilots' union. The airline has signed a tentative agreement with the pilots, expected to be ratified by September 14, 1998, in an effort to resume its operations as soon as possible. The firm is expected to start contract negotiations with the other unions representing non-pilot personnel by October 1998.

Comment:

Its earnings forecast for its fiscal 1998 has been downgraded by analysts by 30 cents per share

Financial analysis

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