Air Canada serves lockout notice to pilots

[GP_Matt]

I may be one of the few to admit it, but my default choice when booking flights is Air Canada. I find the price to be comparable and therefore base my choice on schedule. Air Canada seems to fly more often and during more convenient times. That is always nice if you are flying somewhere for a meeting and don't know when it will end. With AC I can book the late flight home and then change flights or get on standby to get home quicker if things end early. With Westjet's fewer flights it is harder to switch.

[STeeLy]

I can understand the back to work legislation on CanadaPost, since they are really the only mail carrier in Canada. (I don't count UPS, Fedex, DHL, etc..., since people use them more for parcels and very little mail)

I don't understand why they would use the back to work registration on Air Canada. There is another airline in Canada that people can take and the prices are very comparable (at this point), why should the government order the AC pilots back to work.

There is competition, why not allow Air Canada's blunders to benefit other airlines?

[ken0042]

I don't think West Jet would want Air Canada to go under; not yet anyway. They have been extremely successful, and the one thing they have been very careful about is not growing too fast. A few things WestJet would have to do over the next 10-20 years:

- Buy billions of dollars worth of aircraft to handle the capacity.
- Increase maintenance to handle many different aircraft types. (WJ only carries a few types of planes; mostly 737s.)
- Get partnerships with more international carriers. That takes time, and resources.

No, WestJet likes this as it creates uncertainty in with AC, so people might be more inclined to book with them. It lets them grow at the pace they want. If there was an Air Canada strike for more than a couple of weeks, WestJet wouldn't be able to handle it.

[sa226]

Just to clear things up,

The largest union at air Canada which represents maintenance workers and a bunch of others are the ones who served strike notice.

The pilots union was ordered back to the bargaining table for 6 months, air Canada tabled what they said is their final offer (which from what I understand is downright insulting).... And stated that if they don't accept it they will lock out the pilots. The pilots rightfully didn't accept and that is when Air Canada served lockout notice.

So as of Monday morning, one union of 3000 could be locked out and another of 8800 could go on strike.

I have heard many opinions on strategy. The one I find most interesting is that these are the first steps towards filing for bankruptcy again. And instead of liquidating, they would restructure from the ground up.

Air Canada in its present form, despite high load factors, is bleeding money.

[pylon]

Air Canada should be left for dead. Such an incredibly bad run company. ANd the employees, do not grasp the fact that DEMANDING more from a company bleeding out, will just accelerate the demise. I have no idea what planet some people live on with their entitlement to more, of nothing.

Each and every single employee in the management sector of AC should be ashamed of themselves that a rinky-dink (in comparison) operation like WestJet, has managed to avoid unions, be mega profitable, and have one of the happiest workforces on the planet, without said union. Shame on Air Canada.

I say, dissolve them, and somehow let Westjet take them over under their business model. I am sure their is some way to do it.

[CaptainCrunch]

Originally Posted by sa226

Just to clear things up,

The largest union at air Canada which represents maintenance workers and a bunch of others are the ones who served strike notice.

The pilots union was ordered back to the bargaining table for 6 months, air Canada tabled what they said is their final offer (which from what I understand is downright insulting).... And stated that if they don't accept it they will lock out the pilots. The pilots rightfully didn't accept and that is when Air Canada served lockout notice.

So as of Monday morning, one union of 3000 could be locked out and another of 8800 could go on strike.

I have heard many opinions on strategy. The one I find most interesting is that these are the first steps towards filing for bankruptcy again. And instead of liquidating, they would restructure from the ground up.

Air Canada in its present form, despite high load factors, is bleeding money.

I was reading today that the number is a quarter billion dollars this year alone with a 60 million dollar loss in the last quarter.

I would prefer that Air Canada goes away, they're a drain on the government and there's no reason to support them anymore.

I would feel bad for the employees but bad business decisions, a union trying to force strikes and lockouts to get a bigger piece of a negative pie = a bad company can't be kept on life support just to save jobs.

The auto industry could be rescued, Air Canada hasn't shown any signs of being savable. Unless the Union is willing to step in and buy and run an airline, or someone is willing to step in and buy it, then

Its time to sell off the planes, sell off the routes and retire the symbol.

[NBC]

I'm not sure why anyone would want Air Canada to "go under". That would leave Canada as the only G8 nation without an proper full-service air carrier. As for comparing West Jet's business model to Air Canada's is like comparing chalk and cheese - you cannot do it. Flying one type of aircraft (B737) means vast savings in maintenance, crew training and the like. And while this type is great for flights on the YYC-YVR and YEG-YYZ routes, flying a 737 from Vancouver to Tokyo Narita or Calgary to London Heathrow would not be very economical for the airline or comfortable for the passengers.

West Jet survives because it originally found a niche in the Canadian aviation market, much like Southwest did in the US. They have been fortunate to capitalize on Air Canada's poor image - especially in Western Canada - and grow their business commensurately. Good for them. Having a decent domestic alternative to a national carrier is a good thing, in fact it is a great thing. But I'm not convinced that there is much more West Jet can do in terms of growth if they stay in their current form. Like one poster mentioned, the amount of capital they would need to purchase aircraft that would be profitable enough to compete on long-haul routes would be astronomical. If you do not make the right choices on these routes, your profit margin takes a big hit as there are too many considerable variables at play.

West Jet would be wise, like it's mentor airline Southwest, to not want to punch above its weight and stay far away from being a full-service carrier. As for AC their problems are not arcane to them as all major US full-service carriers have declared chapter 11 in the past decade as well as a handful of European carriers. Asia-Pacific carriers tend to be the most profitable globally. Unfortunately for Canadians, AC is currently and has been a poorly run institution for a number of years. Questionable business strategy, ridiculously powerful unions and a sense of entitlement make flying with them an unattractive venture. Full-service airlines have had a difficult time over the recent past making any sort of profit, though most US carriers made a decent profit in 2011 as opposed to losses in the previous few years. As per Warren Buffett,

"Move on to failures of airlines. Here’s a list of 129 airlines that in the past 20 years filed for bankruptcy. Continental was smart enough to make that list twice. As of 1992, in fact–though the picture would have improved since then–the money that had been made since the dawn of aviation by all of this country’s airline companies was zero. Absolutely zero."

It seems that the poisoned pill of old Wardair has claimed AC in its long list of airlines that have struggled financially since owning a piece of that much-loved and much-maligned airline.

[T@T]

Originally Posted by sa226

http://www.cbc.ca/news/business/stor...da-strike.html

I don't know if anybody has been following the labour strife at Air Canada, it has been ongoing for quite some time. If anybody has a fleeting interest in it I encourage you to do some reading rather than believe the posturing and politics in the media.

But shiat just got real.

May want to have backup travel plans.

The Harper government's crushing of labour, combined with a bloated and hostile Air Canada management that blames its workforce rather than encourages it has all lead to this.

I love my job, but the way this industry is going down the toilet makes me want to be a truck driver.

"Whats the name of that truck driving school? Truck master I think it is, I might need that"

I know your kidding but. Think again,$5-7k to get a license to make about $20 per hour these days, since the teamsters were crushed out of the Canadian trucking industry drivers are grossly underpaid and overworked yet I was told that about 20% of the riches people in Canada own a trucking company...go figure!

A friend of mine had a small company hauling gravel/dirt for 25 years,at one point was very successful,he had 6 or 7 trucks,loyal employees that he treated very well, 2 years ago he finally had enough and had to fold his pride and joy,he was making much less money per tonne than even 25 years ago yet fuel cost had gone up 4x. He blames the "new Canadians" that will work their trucks for nothing and the large gravel companies that hire them for cheap.

Transportation of goods/people is probably the single most important industry on the planet yet it's the most undervalued.

[Deegee]

To be quite honest I haven't followed this labour dispute, but can I go out on a limb and assume another union is working to bankrupt another company?

[Bigtime]

Originally Posted by NBC

A great comparison of AC and WS.

It will be very interesting to see how WestJet does when they start up their turboprop operation. If any company can pull it off with the least amount of internal friction it is probably them. But make no mistake, the addition of a second aircraft type (and different pay scales for those pilots/employees) will introduce an element into the WestJet operation that was never there before.

[-TC-]

Of all the flights I've had to book so far for 2012 (Boston, Orlando, Vegas, Boston), only one is on AC. The only reason I'm on that flight is that my client chose it, if I had my way I would never fly AC.

I don't like the attitude of the whole company, it's management, the way they treat me when I fly..couple all that with the constant labour strife, the government bailouts and the rest, and they don't deserve my money. Bottom line.

I'd rather they go under or get rebuilt with new management, then continue to have to deal with their bull####.

[the-rasta-masta]

One thing about Air Canada is that their pilots are exceptionally trained and have one of the best safety and maintenance records in the industry. This is more important to me than anything else, and I will continue to fly Air Canada for that reason.

[GP_Matt]

The last time I flew Westjet it was for a ski trip. I had booked and prepaid for three days of skiing but Westjet canceled all flights the day I was leaving due to weather so I had to leave the next day. My flight went through Edmonton and that portion was still on time which means I had time to drive to Edmonton to pickup the rest of my flight but rather than cancel they just posted a delayed notice on the board and left it up well after they started telling passengers that the flight was canceled and making arrangements. I didn't think it was a big deal, I would just stay an extra day on the back end of my trip to get all my skiing in so I called WS to delay my return flight by 24 hours. They insisted on a full change fee as the delay only affected the outbound portion of my trip which means they wanted the penalty as well as the difference in price between what I paid and what they were selling the fare for three days in advance. I got a seat sale when I booked so the new price was double plus the penalty. I spent two hours on the phone with them trying to convince them that they had in fact inconvenienced my entire trip, not just the outbound portion.
As a side, when I mentioned that Air Canada had all their flights leaving on time that day and it was only WS heavier 737's that were canceled he told me that AC was flying because they didn't care about passenger safety.

tl;dr I think both airlines have some crappy employees and some great employees.

[LChoy]

Just my 2 cents

I actually quite like flying AC. There entertainment system is the top of the class compared to anything in North America. I also collect Aeroplan points which is very helpful
For longer trips, AC executive class is quite nice, and I loved my experience staying in the new pods.

While AC can't really compare with some of the International airlines out there, in my opinion, they are by far the best airline in Canada and the US in terms of comfort

[uofaflamesfan]

I am flying to Palm Springs through LA from Calgary on March 28. The flight was booked through United but is operated by Air Canada. I'm a little freaked out now by the recent events.

Anyone have any idea how long it normally takes for the Board to investigate these things? Should I be ok?

[CaptainCrunch]

Originally Posted by NBC

I'm not sure why anyone would want Air Canada to "go under". That would leave Canada as the only G8 nation without an proper full-service air carrier. As for comparing West Jet's business model to Air Canada's is like comparing chalk and cheese - you cannot do it. Flying one type of aircraft (B737) means vast savings in maintenance, crew training and the like. And while this type is great for flights on the YYC-YVR and YEG-YYZ routes, flying a 737 from Vancouver to Tokyo Narita or Calgary to London Heathrow would not be very economical for the airline or comfortable for the passengers.

West Jet survives because it originally found a niche in the Canadian aviation market, much like Southwest did in the US. They have been fortunate to capitalize on Air Canada's poor image - especially in Western Canada - and grow their business commensurately. Good for them. Having a decent domestic alternative to a national carrier is a good thing, in fact it is a great thing. But I'm not convinced that there is much more West Jet can do in terms of growth if they stay in their current form. Like one poster mentioned, the amount of capital they would need to purchase aircraft that would be profitable enough to compete on long-haul routes would be astronomical. If you do not make the right choices on these routes, your profit margin takes a big hit as there are too many considerable variables at play.

West Jet would be wise, like it's mentor airline Southwest, to not want to punch above its weight and stay far away from being a full-service carrier. As for AC their problems are not arcane to them as all major US full-service carriers have declared chapter 11 in the past decade as well as a handful of European carriers. Asia-Pacific carriers tend to be the most profitable globally. Unfortunately for Canadians, AC is currently and has been a poorly run institution for a number of years. Questionable business strategy, ridiculously powerful unions and a sense of entitlement make flying with them an unattractive venture. Full-service airlines have had a difficult time over the recent past making any sort of profit, though most US carriers made a decent profit in 2011 as opposed to losses in the previous few years. As per Warren Buffett,

"Move on to failures of airlines. Here’s a list of 129 airlines that in the past 20 years filed for bankruptcy. Continental was smart enough to make that list twice. As of 1992, in fact–though the picture would have improved since then–the money that had been made since the dawn of aviation by all of this country’s airline companies was zero. Absolutely zero."

It seems that the poisoned pill of old Wardair has claimed AC in its long list of airlines that have struggled financially since owning a piece of that much-loved and much-maligned airline.

They're on track to lose a quarter of a billion dollars this year. I don't know what you suggest.

But maybe having a national airline just for the sake of having a national airline is the wrong reason for letting it survive with constant bailouts.

Its a unsupportable model right now.

You can't keep giving blood to a guy with an open artery that you can't fix. At some point you have to turn off the taps and see if he survives.

I'm willing to bet that one of the main reasons why Air Canada hasn't fixed or tried to fix their problems is because they know they can run hat in hand to the government, cry that they're a national institution and get money.

And for god sakes hire some hotter stewardesses.

[bizaro86]

The thing with the arguments not letting Air Canada die so we have a national airline is that they're completely and utterly wrong.

If Air Canada went into liquidation, there would be a transition period, but Canada would have a national full service airline at the end of it. The market is there for long haul flights from a Canadian based airline and someone would step into the gap and serve it. There are lots of people who want to start airlines, we'd probably have 2-3 start up right away.

Or maybe Chorus (parent company of Jazz) would just buy the planes and assets and hire their own employees to fly the big planes. That's what happened when the legacy airline of Switzerland liquidated in 2002. The former regional subsidiary (crossair) bought the planes and renamed itself Swiss.

Air Canada going bankrupt is like going to the doctor for stitches. It's painful when you're going through it, but it stops the long term bleeding. We could have a better run more efficient airline industry in Canada, but not while a bloated gov't propped up monstrosity is filling up the market.

(And I'm a regular Air Canada customer, with elite status, etc. It's the only airline that comes close to flying where I go. But if they left, they'd be replaced)

[Bertuzzied]

It's mind bottling to see why anyone would fly Air Canada if West Jet has the same route? My brother started to convince me that Air Canada isn't so bad anymore. Until they delayed his flight by 2 and 3 hours on his last trip. sucker! haha

[valo403]

Originally Posted by STeeLy

I can understand the back to work legislation on CanadaPost, since they are really the only mail carrier in Canada. (I don't count UPS, Fedex, DHL, etc..., since people use them more for parcels and very little mail)

I don't understand why they would use the back to work registration on Air Canada. There is another airline in Canada that people can take and the prices are very comparable (at this point), why should the government order the AC pilots back to work.

There is competition, why not allow Air Canada's blunders to benefit other airlines?

West Jet and Air Canada are not comparable airlines. As much as WestJet is grown it's really still a small regional operator in many ways.

[NBC]

I think that Air Canada's problems are fairly representative of what full-service air carriers go through. With the advent of low-cost/budget airlines in North America and Europe twenty-odd years ago, full-service carriers have found it increasingly difficult to eke out any profit whatsoever. The Southwest & Easyjet business models work very well and have become highly profitable due to some of the aforementioned reasons. But relying solely on these types of carriers to cover Canada's large aviation sector is unsustainable in its own right. While flying domestically and to select destinations in the US would likely remain unaffected (service yes, fares no), longer haul flights to Europe, Asia and South America would alter drastically. For someone wanting to fly from Vancouver to Sao Paulo this could result in a West Jet flight to Denver, United Airlines to Mexico City and Grupo Taca to Sao Paulo. The fares would be ridiculously high and would take much longer to complete.

Having said that, some of the large US airlines that have restructured over the past decade (United, US Air, Delta) were able to turn a profit during the past fiscal year (2011). United had to renegotiate its contracts with its pilots union before anything could happen. Fortunately those labour negotiations were nowhere as acrimonious as what Air Canada and their unions have undertaken. I am not sure why Air Canada haven't been able to sort themselves out like some of their US counterparts.

While I completely agree that it is unsustainable for any government to continually step in when there are questions over an airline's profitability, I for one would not like to see civil aviation in Canada without a full-service air carrier. Until everyone has agreed to a policy on open skies, where foreign carriers can operate domestic routes, you'd be a half step away from a captive market which could see fares from YYC-YYZ effectively double. Canadian-US markets would remain relatively unscathed due to the preponderance of US air carriers that could serve Canadian destinations. But domestic and non-US international flight service would completely change. If the airline were to restructure (yet again) and emerge as Air Canada-light, similar to what Alitalia did in 2008/09, then the burden on non-US air travel in Canada would definitely ease. Unfortunately Alitalia, while still remaining a full-service carrier, has found it difficult to turn a profit in the three years since its restructuring.

I wish I knew what the answers for Air Canada were, but I don't believe that simply letting the airline expire is the best way forward.