Air Canada to file for BK

1ab

Advanced
Aug 21, 2002
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Reason for the topic is :
Is air canada a member of the Star ALliance and if so what are the consequences of the alliances with 2 of its members in BK
 

usfliboi

Veteran
Aug 20, 2002
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ACtually the only negatives are for the employees and stakeholders in the short term. I think it has become obvious that bk has become a wonderful tool in order for airlinesto break the unions in some ways and cut the heck out of over head in others. I see most majors doing it in the end........
 

funguy2

Veteran
Aug 20, 2002
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Well... I've been highly critical of Air Canada before, and I guess I will be again. I think AC is a basket-case under the surface. They have been splitting themselves up, trying to avoid looking like a monopoly, and confusing the heck out of their passengers... Air Canada, Jazz, Tango, Zip... Then Tango moves to T3 at Toronto (The non-Air Canada terminal). Some CRJ flights are mainline AC while others are Jazz... I think they are confusing their passengers, and their passengers are happy to try WestJet, which is perceived as simpler and cheaper.

I wonder how good that purchase of Canadian looks now in hind-sight. Canadian could have drifted away on its own by now... But Air Canada wanted to hasten its demise, which resulted in employee retention, multiple fleet types. I wonder how much that acquisition really cost them.

And the dramatic emergence of the low-fare carriers, lead by WestJet, which previously could never get a footing in Canada. Remember, at 1/10th the size of the USA, AC has a limited market and WestJet has really moved in hard on Air Canada's turf.

Having said all that... I think AC can survive... It needs to get rid of all of the splits, and center on just a few fleet types...

Pick one or two long-haul fleets... I'm not sure which works best for them... Probably A330/340. But maybe the Boeings 744/767. But they should pick one family and go with it.

Pick one domestic jet... probably the A320/319 family, since they already have many... Dump the 737-200's and any left over DC-9's.

Pick two domestic regional aircraft: probably the CRJ family and the DH8 family, again, since they have already have many. They should get rid of the F-28's and BAe 146's, if they haven't already. Also, they would need to dispose of the fleets of Canadian Regional (I think they had ATR's), again if not already done.

Of course, they will probably try to hit on labor costs, but I think they will be less successful than USA counter-parts at extracting huge wage reductions.

Lastly, AC needs to be competitive and realize that its advantage is service (which has been very good in my experience). Like AA (so far) they should not try to be a low-cost/fare carrier. If Air Canada offers its pax a high quality product at reasonable prices, I don't think their passengers would flock to to low-fare carrier and the low-fare guys niche would be limited.

Just my $0.02.
 

PITbull

Veteran
Dec 29, 2002
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www.usaviation.com
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On 4/1/2003 11:15:48 AM usfliboi wrote:

ACtually the only negatives are for the employees and stakeholders in the short term. I think it has become obvious that bk has become a wonderful tool in order for airlinesto break the unions in some ways and cut the heck out of over head in others. I see most majors doing it in the end........

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Well usfliboi, you have now entered into my world of the "Union busting conspiracy theory" that I have written about since late August. Welcome into the "inside of my mind".
 

FrugalFlyer

Senior
Aug 20, 2002
254
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funguy2,

There were many factors that contributed to ACs filing for bankruptcy
1) Canadian government
2) low fare competition (westjet, canjet, jetsgo)
3) CP purchase
4) war in iraq
5) bad us economy
6) sars
7) cannabilism of mainline by TANGO and ZIP

but this is a topic that should be discussed on the ''Foreign Carriers'' board, unless I''m missing the USAirways connection ... ... ...
 

funguy2

Veteran
Aug 20, 2002
1,755
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Thats funny... I did not even realize this was under US Airways... Oops. Maybe the moderators can move this thread to the right place?