World Vision Canada and Air Canada team up to aid tsunami victims


1/4/05
TORONTO, Jan 04, 2005 (The Canadian Press via COMTEX) --

The first relief agency flights from Canada to tsunami-stricken Indonesia are expected to take off from Toronto this week.

The first of the two Air Canada cargo flights will leave Toronto's Pearson International Airport on Tuesday, ferrying aid workers and more than 40,000 kilograms of desperately needed supplies.

A second plane will carry more than 85,000 kilograms of relief supplies to Indonesia's capital, Jakarta, on Wednesday, said Air Canada spokeswoman Laura Cooke.

The relief material, supplied by the World Vision Canada, is headed for Indonesia's hard-hit Aceh region.

"Things like dried food, water purification tablets, clothing, blankets, tarps, tents, medical supplies, pharmaceuticals, personal care products, which might sound funny, but soap and that sort of thing are very important now because of the risk of disease," said Judy Burrell, a spokeswoman for World Vision Canada of the supplies.

"Some of it was on hand - we do store things in bulk ahead of time just in case - some if it did come from storage facilities, but the rest of it was donated by companies."

As of Tuesday, World Vision Canada had raised $8 million for the tsunami relief effort - part of the millions donated to charitable organizations by Canadians. The federal government has said it will match donations by individual Canadians up to Jan. 11.

Large charitable organizations say they prefer cash and not donations of food or clothing. They buy the items they need in bulk overseas, which reduces sorting, storage and shipping costs.

But Air Canada made an offer of two flights to World Vision Canada that the charity couldn't refuse.

"It was really terrific. We would rather people give us cash because you save a lot of money if you buy things there and in bulk. Transportation is a huge cost, but with Air Canada making this donation to us, we took advantage of it," said Burrell.

Air Canada made the offer after being approached by employees who were anxious to help in relief efforts following the Boxing Day natural disaster.

Cooke said the employees involved are helping out on their own time and will not be paid for the efforts, although she added the airline will cover their expenses.

Cooke could not say how many employees had volunteered.

"We had a significant number of employees come forward wanting to volunteer to be part of the mission. Whether that was as simple as working at the airport getting the relief mission organized, working on the ramp, or with the cargo, right down to the crews that will operate the flight," said Cooke.

She also said of our pilots taking the controls for a leg of one of the flights is a retiring captain who wants to make his last flight part of this relief flight.

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Airlines ask Ottawa for breaks on airport rents, foreign ownership
SIMON TUCK
6 January 2005
The Globe and Mail

Ottawa

Canada's struggling airline industry called on Ottawa to help out the sector by reducing airport rents and loosening foreign ownership restrictions, while arguing that such measures would also stimulate the economy.

The industry says government policies are unnecessarily adding to costs and ticket prices, at a time when airlines are already burdened with high costs for fuel and security. Most airlines in Canada and throughout the world have been struggling since the Sept. 11, 2001, terrorist attacks in the United States, but domestic airlines have been unable to persuade Ottawa to make key moves to improve the industry's competitiveness.

“The industry is fundamentally in the doldrums,” said Eugene Hoeven, director of the International Air Transport Association (IATA), during a press conference in Ottawa. “If you can't manage your costs, and drive those unit costs down, then you're not going to be in it for the long haul.”

The industry also says it would benefit if federal limits on foreign ownership of Canadian airlines, which now stand at 25 per cent, were raised. Raising foreign ownership restrictions on the airline industry was seen last year as a key policy option as the government considered what to do about Air Canada's financial troubles. Hiking those restrictions would provide the airline — and its smaller rivals — with greater access to capital.

But the industry's main beef with the federal government is the rent that Ottawa charges the authorities that run the country's airports. Those rents, which were increased by another $18-million or 6.5 per cent on Jan. 1, were negotiated after the federal government transferred control of the facilities to the not-for-profit airport authorities more than a decade ago.

Cliff Mackay, chief executive officer of the Air Transport Association of Canada, said the airports get nothing for their rent money, but that the de facto tax adds between about 2 per cent and 6 per cent to the price of each airline ticket. “Clearly, this is a big deal for our industry.”

The rent issue has for years been a thorn in the side for airlines, but the industry believes it now has greater support among federal politicians for reducing rents.

Transport Minister Jean Lapierre said late last year that he'd like to freeze, and then reduce airport rents, but his plan was rejected by Finance Minister Ralph Goodale.


Feds hit Winnipeg airport with 2.5% increase in rent
Small compared to average 6.5% hike in other cities
Geoff Kirbyson
6 January 2005
Winnipeg Free Press

Geoff Kirbyson THE Winnipeg Airports Authority escaped relatively unscathed from new federal government airport rent increases announced yesterday, but its president and CEO is adamant its landlord is still charging too much.

Barry Rempel said the WAA's rent will increase by 2.5 per cent, or about $200,000, to $4 million in 2005.

"This is really just a tax. In our case, it's really the principle behind it as much as the amount," Rempel said in an interview.

Ottawa announced airport rents will increase by an average 6.5 per cent across the country, effective Jan. 1.

Rent in Montreal is expected to rise 30 per cent this year and landing fees at Toronto's Pearson International Airport, the country's biggest and busiest, is set to rise 17 per cent over 2004 rates.

Rempel said that when the government turned the operation of the country's largest airports over to regional authorities in the early to mid-'90s, the rents were designed to help bring Ottawa out of deficit.

"Now that's behind us. The rents don't have a policy reason behind them now," Rempel said.

He noted the total book value of Canada's major airports at the time was $1.5 billion. Since then, the airports have paid more than $2 billion in rent.

Joanne Sigurdson, president of Uniglobe Destination Travel Group in Winnipeg, said the 6.5 per cent rent increase across the country isn't huge, but airport rents are certainly one of the factors that go into the cost of airline tickets.

"I'm sure, one way or the other, the consumer will end up paying for the increase," she said in an interview yesterday.

Cliff Mackay, a spokesman for the Air Transport Association of Canada, said the rent increases hurt the tourism industry, the aviation sector and travellers alike.

"It is time for the federal government to stop treating air travellers like cash cows," Mackay said yesterday at a news conference that called on Ottawa to cut airport rents in its coming budget.

Higher rents add at least two to three per cent on the price of many airline tickets, he said.

Winnipeg is definitely on the low end of the rent scale compared to the rest of Canada's major airports. Toronto's Pearson airport has the highest rent for 2005 at $145 million, followed by Vancouver ($80 million), Montreal ($28 million), Calgary ($24 million) and Ottawa ($13 million). Both Edmonton and Halifax airport authorities will pay roughly the same $4 million as the WAA.

Rempel said the current formula at Winnipeg International, which is based on inflation and passenger traffic, calls for rent to nearly double from $3.8 million last year to $7.5 million in 2009, the year its new terminal building is scheduled to open.

Rempel said the WAA's ongoing fundraising efforts through the Airport Improvement Fee (AIF) for its new terminal building will not be affected by the rent increase.

Some airlines say higher fees mean a passenger flying from Toronto to Ottawa would pay almost as much in taxes and surcharges as the cost of the actual airfare.

WestJet, for example, has estimated that a passenger could pay as little as $41 for a one-way fare between the two cities on Jan. 10.

However, the traveller would have to shell out another $37.76 in extra charges, an amount equivalent to 92 per cent of the airline fare.

The add-on costs include a $15 airport improvement fee, $12 in navigational fees and insurance, $5.61 for air travellers' security charge and $5.15 in GST.

Rempel said the WAA is continuing its consultations with various groups from Winnipeg's business and arts communities, as well as the travelling public, regarding its new terminal building. He said they're providing feedback to initial concept drawings of the structure, a process that will culminate with a session open to the general public next month.

-- with files from Canadian Press

WestJet Passenger Load Factor Rebounds in December
January 6, 2005

MONTREAL (Reuters) - WestJet Airlines Ltd., filled more seats in December than a year earlier, the company said on Thursday, as it appeared to recover from computer glitches that hurt flight bookings in November.

The Calgary-based no-frills carrier said its passenger load factor -- an indication of how successful it was in filling its planes -- was 74.7 percent in December, up from 73.6 percent in the year earlier month.

That was also a rebound from November, when problems with WestJet's Internet-based reservations system pushed its load factor to an all-time low of 58.5 percent from 64.1 percent a year earlier.

WestJet's passenger traffic growth also outpaced its rise in capacity for December, the company said.

Revenue passenger miles rose 34.5 percent in December from a year earlier, while available seat miles grew 32.4 percent from the year earlier month.

WestJet shares were off 5 Canadian cents at C$11.82 on the Toronto Stock Exchange at midday on Thursday.

($1=1.24 Canadian)

Jat Airways from Serbia will aquire new 767-300 ERs to open a route from Belgrade to Toronto after the break of 13 years (because of UN sanctions).

Thread (http://skyscrapercity.com/showthread.php?t=122899)

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Air Canada to Introduce Non-Stop Service Between Toronto and Seoul
Builds Toronto Hub as Gateway to Asia

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MONTREAL, Jan. 7 /CNW Telbec/ - Air Canada today announced that it will introduce non-stop flights between Toronto and Seoul, further building its main Toronto hub with more non-stop services to Asia. Air Canada will operate three times weekly non-stop service from Toronto beginning July 1, 2005, complementing its daily non-stop flights from Vancouver to Seoul. With an elapsed time of 14 hours 15 minutes westbound and 12 hours 55 minutes eastbound, the non-stop flight will save travellers 3 hours 20 minutes compared to the Vancouver routing.

"New non-stop service to Seoul from our main Toronto hub brings eastern North America that much closer to Korea, and strengthens Air Canada's position as a carrier of choice between North America and Asia," said Ben Smith, Vice President, Planning. "Our growth in non-stop flights between Toronto and Asia complements our extensive choice of non-stop services from our main Asia gateway in Vancouver, and offers customers more flexibility and choice in their travel planning. Combined with our major expansion of services
throughout Latin America, also via our Toronto hub, Air Canada offers international travellers between Asia and South America the added convenience of avoiding U.S. transit visa requirements."

Air Canada will operate the new route using 282-seat A340-300 aircraft. With a 09:45 departure from Toronto on Wednesday, Friday and Sunday, arriving in Seoul at 13:00 the next day, flight AC065 is timed to offer convenient morning connections to and from points throughout Air Canada's extensive North American network, particularly in eastern Canada and the United States. The eastbound flight, AC066, leaves Seoul at 14:40 on Monday, Thursday and Saturday and arrives in Toronto at 14:35 the same day, providing maximum connecting options.

With the addition of Toronto-Seoul non-stop service, Air Canada will offer customers up to 12 non-stop flights per day in each direction between Canada and eight destinations in Asia. From its main hub in Toronto, the carrier operates daily non-stop flights to Hong Kong, Tokyo and Delhi, the only non-stop link between North America and India. From its Pacific Asian gateway in Vancouver, Air Canada serves Hong Kong, Shanghai, Beijing, Tokyo, Osaka, Nagoya and Seoul with daily non-stop flights, as well as Taipei on a codeshare basis.

7 January 2005


Air Canada is to introduce non-stop flights between Toronto and Seoul. The airline will a operate three times weekly non-stop service from Toronto beginning July 1, 2005, complementing its daily non-stop flights from Vancouver to Seoul. With an elapsed time of 14 hours 15 minutes westbound and 12 hours 55 minutes eastbound, the non-stop flight will save travellers 3 hours 20 minutes compared to the Vancouver routing.

"New non-stop service to Seoul from our main Toronto hub brings eastern North America that much closer to Korea, and strengthens Air Canada's position as a carrier of choice between North America and Asia," said Ben Smith, Vice President, Planning. "Our growth in non-stop flights between Toronto and Asia complements our extensive choice of non-stop services from our main Asia gateway in Vancouver, and offers customers more flexibility and choice in their travel planning. Combined with our major expansion of services throughout Latin America, also via our Toronto hub, Air Canada offers international travellers between Asia and South America the added convenience of avoiding U.S. transit visa requirements."

Air Canada will operate the new route using 282-seat A340-300 aircraft.

With a 09:45 departure from Toronto on Wednesday, Friday and Sunday, arriving in Seoul at 13:00 the next day, flight AC065 is timed to offer convenient morning connections to and from points throughout Air Canada's extensive North American network, particularly in eastern Canada and the United States. The eastbound flight, AC066, leaves Seoul at 14:40 on Monday, Thursday and Saturday and arrives in Toronto at 14:35 the same day, providing maximum connecting options.

With the addition of Toronto-Seoul non-stop service, Air Canada will offer customers up to 12 non-stop flights per day in each direction between Canada and eight destinations in Asia. From its main hub in Toronto, the carrier operates daily non-stop flights to Hong Kong, Tokyo and Delhi, the only non-stop link between North America and India. From its Pacific Asian gateway in Vancouver, Air Canada serves Hong Kong, Shanghai, Beijing, Tokyo, Osaka, Nagoya and Seoul with daily non-stop flights, as well as Taipei on a codeshare basis.

WestJet to Commence Service between Calgary and Palm Springs
JANUARY 6, 2005 - 11:00:00 ET

CALGARY, ALBERTA--(CCNMatthews - Jan. 6, 2005) - WestJet will commence its new non-stop service from Calgary to Palm Springs, California on January 7. WestJet will offer a twice weekly non-stop flight between Calgary and Palm Springs, with connecting service available from other Canadian WestJet destinations. Beginning February 5, WestJet will increase transborder service between Calgary and Palm Springs by one flight per week. These flights will operate until April 3, 2005.

WestJet currently offers approximately 395 scheduled non-stop departures per week from Calgary to 22 destinations in Canada and the U.S. Other non-stop warm weather locations include Calgary to Fort Lauderdale, Calgary to Orlando, Calgary to Los Angeles, Calgary to San Francisco, and Calgary to Phoenix. Sean Durfy, WestJet's Executive Vice President, Marketing and Sales, said today, "We are very excited to be launching our new non-stop service from Calgary to Palm Springs on Friday. This twice weekly non-stop service to Palm Springs is the final phase of our previously announced expansion into the U.S. market. Over the past few months WestJet has added service to eight U.S. cities, including Los Angeles, San Francisco, Phoenix, Orlando, Fort Lauderdale, New York, Tampa, and finally, Palm Springs."

WestJet serves the 24 Canadian cities of Victoria, Comox, Vancouver, Abbotsford/Fraser Valley, Prince George, Kelowna, Grande Prairie, Calgary, Edmonton, Fort McMurray, Saskatoon, Regina, Winnipeg, Thunder Bay, Windsor, London, Hamilton, Toronto, Ottawa, Montreal, Moncton, Halifax, Gander and St. John's, and the eight U.S. cities of San Francisco, Los Angeles, Palm Springs, Phoenix, Tampa, Orlando, Fort
Lauderdale and New York. The airline operates a growing fleet of 54 aircraft featuring 36 new Next-Generation Boeing 737-700 aircraft.

Air Canada Sets December Passenger-Load Record
January 10, 2005

TORONTO (Reuters) - Air Canada filled more seats in December than a year earlier, with its passenger load factor setting a record for the month, the country's largest airline said on Monday.

Passenger load factor is a key indicator of an airline's financial performance, measuring the average number of seats sold as a proportion of those available.

Air Canada's system-wide load factor rose to 75.2 percent in December, a record level for the month, from 72 percent a year earlier.

Passenger traffic at Montreal-based Air Canada's mainline carrier rose 1 percent, while capacity fell 3.3 percent.

Air Canada emerged from 18 months of court protection at the end of the third quarter with a pared back network, fleet and work force.

At Jazz, Air Canada's regional subsidiary, passenger traffic rose 6.2 percent, while capacity fell 7.4 percent. Its December load factor rose to 68.2 percent from 59.4 percent in December 2003.

Restricted voting shares of Air Canada's parent company, ACE Aviation Holdings Inc., rose 10 Canadian cents to C$34.50 in Toronto on Monday on volume of about 237,000.

($1=$1.22 Canadian)

redundant post - edited -

January 10, 2005



MONTREAL (CP) - Air Canada, having downsized and restructured, has reported its best-ever December load factor, with 75.2 per cent of its seats filled with paying passengers.

The airline said Monday it flew one per cent more revenue passenger miles last month than in December 2004, while its capacity was down by 3.3 per cent. The system-wide load factor of 75.2 per cent compared with 72 per cent a year earlier.

On flights within Canada, capacity was cut by 10.1 per cent and the load factor increased eight percentage points to 77 per cent.

For the full year, Air Canada (TSX:ACE.RV) - which emerged from bankruptcy protection in October - said its load factor was 77.5 per cent, up from 73.8 per cent in 2003.

Its biggest domestic competitor, WestJet Airlines, reported last week that its December load factor was 74.7 per cent, up from 73.6 per cent in December 2003.

WestJet (TSX:WJA) said its full-year load factor was 70 per cent, compared with 70.6 per cent in 2003.

Thread Merge

Cool thread! :okay:

Last Updated Mon, 10 Jan 2005 18:43:36 EST
CBC News

MONTREAL - Air Canada recorded its best-ever December load factor, filling 75.2 per cent of its seats with paying passengers, the airline announced Monday.

The airline said it flew one per cent more revenue passenger miles last month than in December 2003 while reducing capacity by 3.3 per cent.

On flights within Canada, capacity was cut by 10.1 per cent and the load factor increased by eight percentage points to 77 per cent.

Air Canada (TSX:ACE.RV) said its load factor for the full year was 77.5 per cent, up from 73.8 per cent in 2003.

Its main domestic competitor, WestJet Airlines, reported last week that its December load factor was 74.7 per cent, up from 73.6 per cent for the same month in 2003.

WestJet (TSX:WJA) said its full-year load factor dipped to 70 per cent from 70.6 per cent.

MONTREAL, Jan. 13 /CNW Telbec/ - Air Canada said today that in addition
to relief assistance already offered following the Southeast Asian tsunami
disaster, it is providing free air transportation to Toronto for all of the
entertainment celebrities participating on location in Canada for Asia, a live
national broadcast event on CBC Television and CBC Radio One to benefit
tsunami-stricken Asia.

A few of the 35 stars that will be flying on the wings of Air Canada will
be Bryan Adams, Jann Arden, Neil Peart of Rush, David Usher and all three of
the Trailer Park Boys (Julian, Ricky and Bubbles). Canada for Asia will air
live from the Canadian Broadcasting Centre in Toronto, Thursday, January 13,
from 7 p.m. to 10 p.m. ET on CBC Television and CBC Radio One, and will
feature an all-star Canadian entertainment lineup including Tom Cochrane, Blue
Rodeo, Anne Murray, Rush, Molly Johnson, Oscar Peterson, the Barenaked Ladies,
Bruce Cockburn, and, in a special segment direct from Las Vegas, Céline Dion.

Air Canada has already collaborated with World Vision in support of
relief and reconstruction efforts in countries devastated by the tsunamis by
sending two dedicated relief flights to Indonesia carrying more than
280,000 lbs supplies from World Vision and the carrier's caterer, CARA Foods.
In addition, Air Canada is working with the Canadian Red Cross to collect
donations from passengers on board its flights until the end of January.

"Every effort counts and we at Air Canada and every other company of the
ACE family are proud to be doing our part in the international relief effort
to help rebuild some of those shattered lives in Asia and Africa," said Robert
Milton, Chairman, President and CEO of ACE Aviation Holdings. "This benefit
event is a great opportunity for Canadians to show their support and
generosity, in solidarity with charities and with the broadcast and
entertainment industry."

"World Vision's efforts to provide relief and long-term rebuilding for
the tsunami victims will require years of commitment and millions of dollars,"
said Dave Toycen, President of World Vision Canada. "One of the most important
ways we can get the help to those who need it most is to develop strong
partnerships with organizations like Air Canada. Over the past weeks, we have
worked together to get the critical, initial aid out to the victims. The Air
Canada team's quick and generous response to this relief effort has been truly
impressive."

Proceeds collected though the broadcast will go to World Vision, The
Canadian Red Cross, UNICEF, Oxfam Canada, Care Canada, Save the Children
Canada, Development and Peace and Oxfam Quebec.

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^ :lol:, cool.

anuary 14, 2005

Air Canada will lay off 180 maintenance workers, or 4.7 percent of that employee group, as part of it cost-cutting plans, the airline said on Friday.

The Montreal-based airline said the cuts, out of a maintenance contingent of some 3,800, were part of its continuing restructuring. Most of the layoffs were slated for Vancouver, but some will come in Winnipeg and Montreal.

The airline emerged from 18 months of bankruptcy protection at the end of September with a work force of about 29,000, about 10,000 fewer than it had in early 2003.

"The restructuring is sort of ongoing, where things are still happening, so there might be more," said Isabelle Arthur, an Air Canada spokeswoman.

(Reuters)

Vancouver bears brunt of Air Canada layoffs
Posted Jan 14 2005 08:08 AM PST - CBC News

VANCOUVER - Air Canada maintenance employees in Vancouver are the hardest hit in the company's latest round of layoffs, with 130 workers losing their jobs at YVR.

Another 50 maintenance workers in Winnipeg and Montreal are also being laid off.

A spokesperson for Air Canada says these are only temporary layoffs. John Reber says these notices are part of job reductions announced during the restructuring of the company last year.

But union spokesperson Fred Hospes says these latest layoff notices come as a surprise, because Air Canada employees have already undergone a lot of downsizing.

"We've had six to 10 rounds of layoffs, and you figure that the company has restructured itself. and that it's going to bring some stability," he says.

"And you get to the first part of the new year again and you're faced with another round of layoffs."

The employees will be out of work by the end of the month.

Hospes says the executive of the International Association of Machinists and Aerospace Workers plans to meet with Air Canada on Friday to see if there's any way of saving at least some of the jobs. obs.

Earlier this week, Air Canada reported its best-ever December load factor. The airline said it flew with paying fliers in 75.2 per cent of its seats. That was up from 72 per cent in the same month last year.

Would the Air Canada 340-500's be capable of doing Toronto-Singapore non-stop?

The A340-500 offers the longest range capability of any airliner, flying 313 passengers in a three-class cabin layout over 9,000 nm/16,700 km. It is possible for the A340-500 to fly nonstop from Toronto - Singapore. However, the market isn't big enough to fly between these two cities nonstop. Instead, Air Canada has decided to deploy its first A340 on the Toronto - Hong Kong route.

The A340-500 offers the longest range capability of any airliner, flying 313 passengers in a three-class cabin layout over 9,000 nm/16,700 km. It is possible for the A340-500 to fly nonstop from Toronto - Singapore. However, the market isn't big enough to fly between these two cities nonstop. Instead, Air Canada has decided to deploy its first A340 on the Toronto - Hong Kong route.

Thanks for the information and i certainly understund why they don't do the root if it's not market appealing. ;)

The A340-500 offers the longest range capability of any airliner, flying 313 passengers in a three-class cabin layout over 9,000 nm/16,700 km.

The 777LR is the longest ranged airliner, not the 350.

Yes, the Airbus site where I got the information is wrong. The Boeing 777-300LR, for example, has a range of 9280 nm / 17,170 km.

GREG COATES
SPECIAL TO THE STAR

Aeroplan has established an Aeroplan Tsunami Relief account, allowing members to support communities ravaged by tidal waves in Southeast Asia by donating Aeroplan Miles.

The account is accessible exclusively online at http://www.aeroplan.com.

Donated miles will be used by Doctors Without Borders — Canada to enable both short-term travel to the region for immediate medical emergency response needs, as well as to facilitate travel to help manage ongoing health-related issues and community building.

Aeroplan donated one million miles to start the account.

AIR CANADA HAS SEOUL: Air Canada will introduce non-stop flights between Toronto and Seoul beginning July 1. The airline will offer three weekly flights from Pearson International on Wednesdays, Fridays and Sundays. Air Canada will operate the new route using 282-seat A340-300 aircraft.

PRIORITY CLUB GOES ONLINE: InterContinental has launched a new online browser tool for members of its Priority Club Rewards program, in partnership with Yahoo! search engine.

The co-branded tool bar allows users to manage their accounts online from any computer, as well as access special offers and check or book a reservation. Visit http://www.priorityclub.com for details.

BUSINESS AS USUAL: Despite the recent announcement that Aloha Airlines has filed for Chapter 11 bankruptcy protection, it is business as usual at the Honolulu-based airline. For more, visit http://www.alohaairlines.com.

GET FIT WITH HILTON: Hilton Hotels & Resorts has teamed up with Bally Total Fitness to provide guests with access to more than 5,000 certified personal trainers at Hilton or Bally locations in major cities throughout North America. In addition, Hilton's Personal Performance Program includes enhancements to its in-room exercise options by offering an in-room mini gym designed by Bally. The hotelier will debut these services to guests starting Feb. 1.

ONLINE WITH SEABOURN: Seabourn Cruise Line has added an interactive Guest Registration Form to its website at http://www.seabourn.com.

Booked guests can now submit required information and requests via the Web to ensure accuracy and facilitate efficient processing of final cruise documentation.

AIRWAYS UPS SERVICE: Cayman Airways has increased its fleet with the addition of a fifth 737-300 aircraft and recently began direct service from Miami to Cayman Brac and Boston to Grand Cayman. Cayman Airways' schedule also includes non-stop service between Chicago, Houston, Tampa, Miami and Fort Lauderdale and Grand Cayman.

NOORDAM TO CALL N.Y. HOME: Holland America Line's Noordam will begin sailing from New York City to the Caribbean in 2006. Beginning Feb. 22, the cruise line will offer 10- and 11-night Caribbean cruises out of New York with prices starting at $1,199 (U.S.) per person, double. For more, visit http://www.hollandamerica.com.

GET DOWN UNDER: From the exotic beauty of the Great Barrier Reef to kangaroos and koala bears, Princess Cruises' new Australia South Pacific brochure can help you choose the perfect vacation Down Under. The 82-page booklet is available from travel agents or by clicking on the Brochures link at http://www.princess.com.

DID YOU KNOW? Tourism to New York City is expected to hit record levels for 2004 and more than 40 million visitors, including six million international tourists, are expected this year. As of last October, 39 million passengers (up 13 per cent from 2003) and 11.3 million international tourists (up 10.2 per cent) had flown into the city's three airports.

That's the first time those numbers have risen since the Sept. 11 terrorist attacks.

The 777LR is the longest ranged airliner, not the 350.

You meant 345 and not 350.
Anyway, the 777-200LR has a longer range that the 345, but it's not yet in comercial operation., so, by now, the 345 is the longest airplane flying. (Acording to www.airliners.net, it's first comercial flight has been delayed to 2006: " The 777-200LR was launched in 2000, but is now delayed until 2006.").

Yes, the Airbus site where I got the information is wrong. The Boeing 777-300LR, for example, has a range of 9280 nm / 17,170 km.

It's not wrong. As I said, by now, it's the longest range airplane flying.
Btw, it's 777-200LR, not 300. ;)

Anyway, these ultra-long range planes aren't selling very well.
The 345 has a total of 26 orders and the 772LR has only 5 orders. (however, Singapore Airlines has a large order for 777's which can be taken as any type of 777's, so Singapore will most likely buy some, probably to replace the 340-500, because it's better for an airline operate planes from the same model (777 in this case)).
I took those number from the airbus and boeing sites.

Air Canada Expands Asian Network With Introduction of Codeshare Service to Vietnam

MONTREAL, Jan. 17 /CNW Telbec/ - Air Canada today announced that it is expanding its Asian network with the introduction of codeshare service to Ho Chi Minh City, Vietnam. The new daily service via Hong Kong to Vietnam's largest city and commercial centre begins January 20, 2005. Air Canada operates twice daily non-stop flights from Toronto and Vancouver to Hong Kong, offering customers connections to the new codeshare flights operated with Boeing 747-400 aircraft by its Star Alliance partner, United Airlines.

"The addition of Vietnam as a new destination in Air Canada's growing Asian network is great news for travelers seeking improved access to this important market," said Yves Dufresne, Vice President, International, Alliances and Regulatory Affairs. "Together with our Star Alliance partner, United Airlines, we continue to seek strategic growth opportunities that complement our networks and offer consumers more benefits."

Hong Kong - Ho Chi Minh City
AC5869
20:55 - 22:25

Ho Chi Minh City - Hong Kong
AC5862
06:20 - 09:45

Air Canada is expanding its Asian network with the introduction of a codeshare service to Ho Chi Minh City, Vietnam.

The new daily service via Hong Kong to Vietnam's largest city and commercial centre begins January 20, 2005. Air Canada operates twice daily non-stop flights from Toronto and Vancouver to Hong Kong, offering customers connections to the new codeshare flights operated with Boeing 747-400 aircraft by its Star Alliance partner, United Airlines.

"The addition of Vietnam as a new destination in Air Canada's growing Asian network is great news for travelers seeking improved access to this important market," said Yves Dufresne, Vice President, International, Alliances and Regulatory Affairs. "Together with our Star Alliance partner, United Airlines, we continue to seek strategic growth opportunities that complement our networks and offer consumers more benefits."

Air Canada’s double daily non-stop services between Sydney and Vancouver, introduced last month, have proved successful with Australian travellers to Canada.

Operated by Air Canada’s A340 long-haul aircraft, the flights have almost all been fully booked.

Airline manager Australia and New Zealand Jeannie Foster said that while the carrier knew Australian travellers preferred non-stop flights, it had been “pleasantly surprised” by the response.

“We set ourselves some ambitious commercial targets for the non-stops, so it’s more than gratifying to see those targets met,” Foster said.

Comments by Australians travellers on in-flight surveys have also been positive, with a number of passengers describing the experience as “best flight ever”.

The non-stops are supplemented on a daily basis by Air Canada 767 services which operate Sydney/Honolulu/Vancouver.

18 January 2005

Navtech Inc. wins contract with Air Canada for crew scheduling system
Tue Jan 18,11:18 AM ET

WATERLOO, Ont. (CP) - Navtech Inc. has signed a long-term contract with Air Canada to provide a crew management system. Financial terms of the deal were not released.

Flight attendants at Air Canada and its regional subsidiary, Air Canada Jazz, will use Navtech's system to indicate their scheduling preferences over the Internet. Navtech provides solutions for the planning and control of an airline's flight operations including dispatch and crew planning systems.

Air Canada and Jazz operate an average of over 1,300 flights per day.

Labour dispute grounds Air Canada flights

TORONTO -- A labour dispute has grounded all Air Canada flights in and out of Toronto's Pearson International Airport.

Connie Turner, a spokeswoman with the Greater Toronto Airports Authority, says the airline has told them about an unscheduled job action.

Turner has been told the action involves ground crews.

There's no word on how many flights and passengers are affected.

Toronto TV station CFTO reports passengers waiting at the airport have been told to go home.

19 January 2005


Effective June 2, 2005 Air Canada is to introduce a non-stop service between Toronto and Beijing, further building its main Toronto hub with more non-stop flights to Asia and creating the first-ever direct link between eastern Canada and mainland China. Air Canada will operate four non-stop flights per week from Toronto to the Chinese capital, complementing its daily non-stop flights to Beijing and Shanghai from Vancouver, and twice daily Hong Kong flights including new non-stop service from Toronto.

In addition, in response to increased demand on its Vancouver-Shanghai route, Air Canada will replace its 189-seat Boeing 767-300ER service with larger 282-seat A340-300 aircraft during the peak demand season beginning June 1, 2005. With these new services, Air Canada is boosting its seating capacity between Canada and China by 16 per cent and providing freight forwarders with 45 per cent more cargo tonnage from one year ago.

"China is the fastest growing aviation market in the world, and Air Canada's global network is well positioned to meet the needs of international travellers and freight forwarders. With the introduction of the first non-stop service to Beijing from our main Toronto hub, Air Canada is bringing the Americas that much closer to mainland China," said Montie Brewer, President and Chief Executive Officer. "Growing our non-stop services to China from both eastern and western North America provides customers more flexibility and choice. Combined with our major expansion of services throughout Latin America, also via our Toronto hub, Air Canada offers international travellers between Asia and South America the added convenience of avoiding U.S. transit visa requirements."

With an elapsed time of 13 hours 20 minutes westbound and 13 hours eastbound, Air Canada's new Toronto-Beijing service will save travellers more than three and a half hours in each direction compared to the Vancouver routing. Air Canada will operate the new route using 282-seat A340-300 aircraft. With a 10:00 departure from Toronto on Monday, Tuesday, Thursday and Saturday arriving in Beijing at 11:20 the next day, flight AC031 is timed to offer convenient morning connections from points throughout Air Canada's extensive global network, particularly in eastern Canada, the United States and Latin America. The eastbound flight, AC032, leaves Beijing at 13:20 on Tuesday, Wednesday, Friday and Sunday, and arrives in Toronto at 14:20 the same day, providing maximum connecting options throughout the Americas.

With the addition of Toronto-Beijing non-stop service, Air Canada will offer customers up to 13 non-stop flights per day in each direction between Canada and eight destinations in Asia. From its main hub in Toronto, the carrier operates non-stop flights to Hong Kong, Tokyo, Seoul and Delhi, the only non-stop link between North America and India. From its Pacific Asian gateway in Vancouver, Air Canada serves Hong Kong, Shanghai, Beijing, Tokyo, Osaka, Nagoya and Seoul with daily non-stop flights.

Labour dispute grounds Air Canada flights

TORONTO -- A labour dispute has grounded all Air Canada flights in and out of Toronto's Pearson International Airport...................


TORONTO (AP) -- Air Canada flights out of Toronto were grounded Wednesday night after ground crew workers at the country's largest airport walked off the job and disrupted the travel plans of thousands of passengers.

The ground crew at Toronto's Pearson International Airport were angry after the airline disciplined several employees, apparently over a dispute about clocking out when their shifts end.

The walkout at Air Canada, which just emerged from bankruptcy last fall, has disrupted the travel plans of thousands of people.

About 60 flights were delayed and 19 were canceled by the labor disruption, the first major dispute between the carrier and its workers since Air Canada emerged from bankruptcy protection Oct. 1.



"At this point, all I can say is that it is related to disciplinary action taken by the company against a number of employees" on Wednesday, Air Canada spokeswoman Laura Cooke said.

Bill Trbovitch, a spokesman for the International Association of Machinists and Aerospace Workers, which represents the ground crew, said the dispute centers on "a long-standing issue" over how employees punch out at the end of a shift.

Trbovitch said the employees weren't expected to return to their jobs Wednesday night.

Air Canada is the country's largest air carrier. The Montreal-based company emerged from bankruptcy protection last fall with fewer planes, less debt, a smaller work force, an infusion of new capital and a focus on no-frills travel domestically.

As part of its restructuring, Air Canada cut roughly $1.6 billion a year in operating costs, half of that in concessions from employees.

Air Canada is one sorry ass airline.

Jan. 20 (Bloomberg) -- Air Canada baggage handlers returned to work last night after a four-hour strike at Toronto's Pearson Airport that caused some flights to be delayed, the airline and workers' union said.

The strike, prompted by the airline's attempts to take disciplinary action against several employees, resulted in the cancellation or delay of an undetermined number of U.S. and domestic flights, Air Canada spokeswoman Laura Cooke said in a telephone interview. International flights resumed yesterday evening, she said.

Striking baggage handlers returned to work after Air Canada's management promised it wouldn't take disciplinary action against them, the International Association of Machinists and Aerospace Workers said in a statement sent by Canada News Service.

Paul Lefebvre, president of Local Lodge 2323, didn't return a phone message left after hours seeking comment. Cooke said she was unable to be more specific about the baggage handlers' grievances.

The Montreal-based airline emerged from bankruptcy protection Sept. 30 after spending 18 months negotiating new financing and labor agreements.

Shares of ACE Aviation Holdings Inc., parent company of Air Canada, rose 35 cents to C$36.35 at the close of trading on the Toronto Stock Exchange.

Labour-management relations still boiling at Air Canada, unions say
Thu Jan 20, 4:40 PM ET

TORONTO (CP) - A wildcat strike that temporarily crippled Air Canada operations at the country's largest airport this week was isolated and involved a local dispute, but represents a boiling over of strained labour relations that have simmered since the big air carrier's restructuring, union leaders say.

Air Canada emerged from bankruptcy protection last October and is now back on the path to profitability, operating with much lower debt and a leaner workforce that has allowed the Montreal-based airline to start looking at expanding international routes.

The company launched a new marketing drive. Airplanes were painted. New uniforms were designed for pilots, flight attendants and other staff. A lavish spectacle featuring Quebec singing star Celine Dion was held as chairman Robert Milton showed off the changes.

But labour relations haven't improved much, if at all, according to several unions who spent 18 months in heated talks that resulted in $1 billion in concessions from workers.

"We're looking for more than a fresh coat of paint on an aircraft," said Pamela Sachs of the Canadian Union of Public Employees, which represents Air Canada's flight attendants. "We're looking for a more solid, stable environment of employee relations. And I think (Wednesday) is pretty typical of what's brewing beneath the surface."

Although Air Canada is the country's dominant carrier, the company faces a difficult airline market, where soaring jet fuel costs, discount fare competition, high labour costs and rising airport security fees and other charges remain major obstacles to profitability.

Bill Trbovich, spokesman for the International Association of Machinists and Aerospace Workers, said there's a morale problem at Canada's dominant air carrier.

"It's very bad," said Trbovich, who represents the workers who went on the four-hour illegal strike Wednesday in Toronto.

"A lot of it comes down to respect for your workers and respect for the collective agreements that you sign and management's not doing it."

A representative of a third union who asked not to be identified said the company has "lost the confidence of the employees" and that mistrust of management remains rampant.

According to Trbovich, whose union represents 11,600 Air Canada employees across the country, ground crew workers in Toronto felt slapped in the face by the splashy public relations gala held in October to unveil the company's new colours.

"We lost over 2,400 members through the restructuring and people took a pretty hefty pay cut," Trbovich said Thursday. "Then they come along and they repaint the airplanes, spend $1,400 per uniform on new uniforms for flight attendants and captains, and then bring in Celine Dion for who knows how many millions to go and sell the airline to the public.

"You can't do things that way."

In the dispute Wednesday, more than 100 Machinists members - including those who work on tarmacs guiding planes to terminals - abruptly walked out when the company suggested it may fire workers who had been improperly punching out at the ends of their shifts. The strike ended after a "fresh start" agreement in which the company agreed not to fire anyone but warned workers could be dismissed for misusing punchcards in the future.

Air Canada president Montie Brewer tried to put a positive spin on the negative publicity, saying it "demonstrates the requirement to evolve the way we deal with each other as employees.

"Hopefully this event provides us with the opportunity to drive forward the process of change towards an environment based on trust and respect for each other."

But Sachs said the fact management knew about the issue for several months before the strike - video surveillance above punch clocks had been in use since late November - shows the company isn't properly communicating with employees.

"I think this company is set up to circumvent the union, I don't think the have any interest in working for the union at all," she said.

Sachs has her own recent beef with Air Canada. In December, the company said it overpaid flight attendants about $600,000 for meal allowances and was prepared to go to collection agencies to get it back. The airline has since agreed not to go that route and a process for overpayments and underpayments is being voted on by flight attendants this month.

The Machinists are also upset with 180 layoffs of heavy maintenance mechanics and technicians this month in Vancouver, Winnipeg and Montreal, Trbovich said.

Observers say the Toronto strike was likely an isolated incident, but the company must continue working to improve relations with employees.

"It was a tough year or two that they had been through and it was a lot demanded of the workers in order to bring Air Canada back to the point where it has a future," said Karl Moore, a business professor at Montreal's McGill University. "There was a lot emotion . . . It's an area where they have to keep an eagle eye on, without a doubt."

Rick Erickson, an independent airline analyst based in Calgary, said workers will get some of what they lost in the restructuring back as Air Canada veers back to profitability, as many analysts anticipate.

"There are snapback clauses in the various labour agreements that were signed that as the airline performs, so do the benefits, and I think we're going to see some of those snapback clauses come back sooner than expected because Air Canada has improved so well," he said.

Air Canada strike raises eyebrows: Same old carrier?
Chris Sorensen
21 January 2005
National Post

The brief but crippling wildcat strike by Air Canada's Toronto ground crews, launched in the wake of a company investigation of employee time card abuses, has raised new questions about the restructured airline's ability to overcome a history of caustic labour relations and successfully implement its new business plan.

Air Canada was left scrambling yesterday to resume its operations at Toronto's Pearson International Airport, where 300 employees walked off the job Wednesday night and paralyzed traffic at the airline's main hub.

The work stoppage, which cancelled and delayed dozens of flights and left thousands of passengers stranded, has some observers wondering whether the curtain had been thrown back on the "new" airline, revealing some of the rot that sent it into receivership two years ago.

"This shows that employees are still disgruntled and that anything can happen," said Jacques Kavafian, an analyst at Research Capital Corp. "I think the unions have to discipline their members, because without disciplinary actions, they can do it again and get away with it."

Air Canada emerged from bankruptcy protection last September with virtually no debt and a cost structure that had been reduced by more than $2-billion on an annual basis, which included $1.1-billion in wage and job concessions from its workforce.

Since then, the airline has been posting month after month of improved air traffic results while shares of ACE Aviation Holdings Inc., the airline's holding company, have steadily climbed.

In other words, until last night, things looked relatively bright for Air Canada, which was warned by the judge that oversaw the company's bankruptcy protection to mend the "us-versus-them mentality" that existed between management and the airline's unions.

"This is just one thing that happened now," Mr. Kavafian said. "But the big issue is what will happen in two months?"

Air Canada, however, downplayed the long-term impact of the illegal work stoppage on its business.

"This was a localized incident and the job action was related to a very specific issue," said Laura Cooke, a spokeswoman for Air Canada.

"There was absolutely no justification to stage an illegal strike over this issue and ultimately impact our customers in this way," Ms. Cooke added.

The issue in question was an apparently long-standing practice of employees abusing the time card system by punching in and out other workers who had left their shifts early or, according to one Air Canada source, not coming in to work at all.

Air Canada acknowledged in a memo to employees yesterday that "this fraudulent activity was likely condoned by some of our management personnel," and called the practice an "institutional form of corrupt conduct [that] cannot be tolerated."

Boyd Richardson, an assistant deputy for the International Association of Machinists and Aerospace Workers, which represents some 11,000 Air Canada workers including the ground crews involved in the wildcat strike, said the company used a hidden video camera to investigate the problem and gathered evidence against some 140 workers. "They had two things on the cameras. They had video tape of people swiping multiple cards. But they had also found, in a common storage area close to the time clocks, approximately 85 time cards that they felt shouldn't have been left there."

He said the union tried to strike a bargain with the company that would have effectively put all union members on notice, but said that management appeared intent on disciplining employees it had gathered evidence against.

The airline said in a statement to employees the company reached an agreement Wednesday night to end the work stoppage by giving the workers in question "a fresh start," but warned that "any transgression in the future will result in immediate termination."

Some analysts were quick to label the strikers as a rogue group that did not represent the union and were unlikely to impact what has otherwise been a remarkable turnaround for Air Canada in recent months.

"Let's face it," said Horst Hueniken, an analyst at Westwind Partners Inc. "Some people cheated and you want management to just sit there and do nothing? What needs to be paid attention to is whether there is pattern here. And so far there is not."

Douglas Reid a professor at Queen's School of business, said the incident shouldn't be blown out of proportion, but added the airline's future health will depend on better labour relations.

January 21, 2005

A wildcat strike by Air Canada workers in Toronto that stranded and embittered hundreds of passengers was an isolated event and not a sign of broader problems, the airline's chief executive said on Friday.

"This is a very localized issue, on the ramp in Toronto, and really revolved around people who had done something that any person with common sense knows was very wrong," Robert Milton told reporters.

"The actions of a very small group on a very localized basis was very unfortunate for everybody else that represents Air Canada".

The Montreal-based airline emerged from 18 months of bankruptcy protection as a restructured entity owned by ACE Aviation Holdings on September 30 after changes that included major concessions from its unions.

But baggage handlers and other ground crew staged an illegal four hour walkout on Wednesday, paralyzing Air Canada's operations at its Toronto Pearson hub, after a dispute over alleged abuse of punching out time cards.

Milton, in Toronto to promote his memoir "Straight from the Top: The Truth About Air Canada", was asked if he could reassure customers such a stoppage will never happen again.

"There are so many variables in life and in running an airline, whether there's weather and so on, but I fully stand behind the reliability of Air Canada," he said.

He said strong sales are an indication that passengers still have faith in the airline. Air Canada has reported record load factors in recent months, filling a greater percentage of available seats than ever before.

Milton appeared at the event with Onex CEO Gerry Schwartz, who launched a hostile takeover bid for Air Canada in 1999 shortly after Milton became CEO.

Milton resisted the offer, but Schwartz said the two have since become friends, and he was now glad the bid had failed.

In early 2003 Onex agreed to buy just over a third of Air Canada's Aeroplan travel loyalty program, but it withdrew the offer when the airline entered creditor protection. Schwartz said Onex would still be interested in a deal.

"It's a good asset and we would be very happy to talk to Air Canada about it if they ever decided that they want a partner or (to) sell it. I've never discussed Aeroplan with Mr. Milton since they came out of bankruptcy," he said.

(Reuters)

Building Air Canada Cargo
ED MCKENNA - ASSOCIATE EDITOR
24 January 2005
Traffic World

Air Canada Cargo is poised to launch a new freighter service less than a year after restarting all-cargo operations and separating from its former parent last September.

The new service will be used to expand the carrier's capacity, not just replace airlift taken out of the market, said Gerry Simpson, director of cargo marketing and business development. The service will use wet-leased aircraft.

Simpson wouldn't specify destinations, beyond saying the service would be international. "China is very high on the list of potential opportunities for us, and Hong Kong has long been a good market for us," he said.

Along with new capacity, the service will add impetus to Air Canada Cargo's efforts to rebuild its identity with freighter operations before potentially assembling and operating its own freight fleet for the first time in more than a decade.

To that end, the company crafted a leasing strategy that would give it the opportunity to evaluate aircraft and routes for future freighter service.

The program also is at least a nod to the growing popularity and importance of freighters in the marketplace, Simpson said. In the past few years, all-cargo traffic has grown substantially as belly traffic has declined, according to the International Air Transportation Association. Simpson cheered the prominence of all-cargo service in the U.S.-China bilateral agreement. "We certainly hope we will be able to see the same type of [arrangement] in the near future between Canada and China and other countries."

The company's cargo strategy was developed as the airline weathered an 18-month stint in the Canadian equivalent of Chapter 11 bankruptcy protection. In that period, "we were able to make an arrangement with our pilots that would allow us to do some ACMI [Aircraft, Crew, Maintenance & Insurance] or wet-lease flying," Simpson said.

When Air Canada emerged from bankruptcy last September, its cargo unit became an independent company. That break set "the groundwork to do more of it in the future," said Simpson.

So far, the carrier's wet-lease strategy has been targeted at replacing capacity lost to the downsizing effort on the passenger side, said Simpson. In November, for example, the airline started MD-11 freighter service with aircraft from Gemini Air Cargo between Toronto and Frankfurt. That replaced cargo capacity lost when Air Canada replaced 747-400 combination aircraft with smaller A330s.

Similarly, the carrier launched four weekly freighter flights from Hamilton to Calgary and on to Vancouver, using wet-leased 727-200 aircraft from Cargojet, after downsizing the passenger equipment used on those services.

The 727-200 has proven to be "the right airplane" for the Canadian domestic marketplace, Simpson said. Meanwhile, "the MD-11 has actually given us about 16 percent increased capacity" on the international service.

In addition, the airline has been able to haul different types of cargo, such as large very heavy pieces of steel, he said. With the MD-11, it can now carry a number of automobiles rather than just one or two, he said.

It also gives more upper-deck lift to a market that has seen relatively few freighter operations since Air Canada dropped out of the all-cargo market in the early 1990s. "It is a great move for Air Canada," said John O'Brien, president Canadian International Freight Forwarders Association.

Some smaller players and the express carriers have filled in some of the domestic lift but Sharon Richmond, manager of air imports and exports at Air World Express, a Mississauga, Ont.-based forwarder, says shippers need better connections to Europe and Asia. Because of tight capacity on long passenger routes to Hong Kong, she said, AWE often is "forced to use less direct alternatives, such as Cathay Pacific Airways service, which goes through Chicago."

O'Brien expects the demand to grow as security restrictions in the United States push some air freight north of the border. "There is very little upper deck space available from and to Canada, so most of air freight is coming via the United States," where a snag at Customs can put a shipment on hold for weeks, he said.

"Effective June 2, 2005 Air Canada will introduce a new non-stop service between Toronto and Beijing.

Air Canada will operate 4 non-stop flights per week from Toronto to Beijing.
Herewith complementing its daily non-stop flights to Beijing and Shanghai from Vancouver, and twice daily Hong Kong flights.

Air Canada will replace its 189-seat Boeing 767-300ER service with larger 282-seat A340-300 aircraft during the peak demand season beginning June 1, 2005 on the Vancouver-Shanghai route.

Air Canada will offer customers up to 13 non-stop flights per day* in each direction between Canada and eight destinations in Asia:
From Toronto to Hong Kong, Tokyo, Seoul and Delhi.
From Vancouver Air Canada serves Hong Kong, Shanghai, Beijing, Tokyo, Osaka, Nagoya and Seoul with daily non-stop flights.

Air Canada will operate the new route using 282-seat A340-300 aircraft. With a 10:00 departure from Toronto on Monday, Tuesday, Thursday and Saturday arriving in Beijing at 11:20 the next day, as flight AC031.
The eastbound flight, AC032, leaves Beijing at 13:20 on Tuesday, Wednesday, Friday and Sunday, and arrives in Toronto at 14:20 the same day.

13 non-stop flights per day* in each direction means 13 X 7 x 2 = 182 flights weekly...."

January 20, 2005

A brief wildcat strike on Wednesday stranded thousands of passengers at Canada's busiest airport, Toronto Pearson, where dozens of North American flights were canceled before ground crews returned to work around 8:15 p.m. EST (0115 GMT).

Air Canada canceled the flights to and from Pearson Airport after workers walked off the job earlier in the day.

"It relates to disciplinary action taken by the company against a number of employees," Air Canada spokeswoman Isabelle Arthur said. "We apologize to our customers for this inconvenience."

Officials at the airport told passengers waiting for information that all the flights -- some of which had previously just been delayed -- were canceled.

Frustrated passengers had started to make emergency plans, looking to other airlines to get them to their destinations or searching for space in area hotels.

Air Canada had also begun rebooking passengers on flights scheduled for Thursday morning.

Arthur said several international flights, which were delayed but not canceled, might still depart.

CBC News reported on its web site the dispute started on Wednesday afternoon after the airline, Canada's biggest, disciplined employees over clocking out at the end of their shifts.

Air Canada said the wildcat strike was being carried out by members of the International Association of Machinists and Aerospace Workers (IAMAW).

Connie Turner, spokeswoman for the Greater Toronto Airports Authority which operates Pearson, said the dispute involves ground service employees, including baggage handlers and workers who guide planes on the tarmac.

"We'll continue our airport operations with our other airlines and Air Canada will have to deal with what they have to deal with," she said.

(Reuters)

Monday January 31, 12:03 PM EST
Air Canada To Expand Fleet For Intl Network - News Report

TORONTO (Dow Jones)--Air Canada plans to purchase 50 wide-body aircraft to service its expanding international network, the Financial Times reported Monday.

The newspaper said the airline, a division of ACE Aviation Holdings Ltd., is considering either the Boeing 7E7 Dreamliner or the Airbus A-350, each with capacity for about 250 passengers. The new aircraft would replace the airline's older Boeing 767s.

A spokeswoman for Air Canada declined immediate comment.

The airline has been rapidly expanding its international network, launching new flights to Asia and Latin America.

Earlier this year, ACE Aviation's chief executive, Robert Milton, said the airline was looking for used Boeing 767s to add to its fleet.

Air Canada will also begin taking delivery later this year of the first in a planned order of up to 105 regional jets from Bombardier Inc. of Canada and Embraer S.A. (ERJ) of Brazil. The smaller regional jets will service the airline's domestic and transborder markets.

how could air canada launch new flights when they're almost bankrupt? Last time i went on it, they even reduced to having to buy meals!

Global airline industry sees profits on horizon
Restructured Air Canada flying ahead of the pack Carriers looking to first cumulative profit since 9/11
Kevin McGran
Toronto Star
1 February 2005

Air Canada has a two-year head start on the rest of the world's international airlines as forecasters predict the global industry is heading toward its first cumulative post-9/11 profit in 2005 after suffering through another year of massive losses.

The global industry lost $4.8 billion (U.S.) last year and has lost $35 billion since the terrorist strikes in the United States. It has recaptured lost business, but experts say all the major airlines need to get their costs in line the way Air Canada has.

"The world's legacy carriers haven't made the cuts anywhere near as quickly as Air Canada has," Calgary-based airline analyst Rick Erickson said. "Air Canada has a two-year lead on most of the world's major carriers. They have to restructure to have any hope for success."

Erickson said Air Canada, which shed debt and reworked union contracts in its two-year restructuring process, is ripe for takeoff in international traffic and in taking on low-cost rivals like WestJet. American carriers like Delta and US Airways are beginning to go through cost-cutting and labour talks.

"I think our prospects here are better because our low-cost operators are lean and mean on the cost side and our legacy carrier has restructured with a very strong business plan and wonderful international growth opportunity," said Erickson.

Air Canada's international growth is a big reason that Toronto Pearson International Airport saw a 15 per cent increase in the number of passengers using the airport last year. In fact, with 28.6 million people using the three terminals in 2004, Pearson is within a whisker of its peak volume of 28.9 million in 2000.

"We're very pleased," said Connie Turner, spokeswoman for the Greater Toronto Airports Authority. "I think our numbers were significantly impacted by the effect of 9/11 and SARS. It's better now for the airlines and it's better for us."

The International Air Transport Association yesterday forecast an industry-wide profit of $1.2 billion for 2005. But profitability hinges on annual growth of 6 per cent, an average price of $34 per barrel for crude oil and improved cost efficiency, said IATA director general Giovanni Bisignani.

"The challenge for 2005 is to turn traffic growth into profitability with improved cost efficiency across the industry's value chain," Bisignani told a meeting of the Civil Air Navigation Services Organization in Maastricht, Netherlands.

IATA represents 270 of the world's major airlines. The price of oil, which hit $57 a barrel last autumn, ate into profit in 2004, with IATA saying the industry ended the year with an estimated loss of $4.8 billion despite all regions reporting double-digit, year-over-year passenger and cargo growth.

Erickson agreed that international traffic is recovering but added IATA's forecasts shouldn't be so rosy, especially when it comes to the price of oil, which accounts for up to 30 per cent of an airline's costs.

"It's solidified, but the great bogeyman remains oil. I don't know where they're getting their forecasts. I'm in the oil capital of Canada and I don't think 34 (dollars per barrel) is the right number. I think it's closer to 40. We won't see the $55, $57 a barrel we saw in November. But ... there's no control. The international aviation arena is a volatile place."

He said Air Canada is an ideal carrier for passengers who are "transiting" through North America, en route, for example, between South America and Asia. The U.S. requires most passengers to carry visas even if only touching down in an airport to transfer planes. Canada's requirements are looser, opening up a market for Air Canada.

Domestically, Canada's low-cost air carriers are in for a "skinny" year, says Erickson, beginning in July when Air Canada takes possession of the first of 15 regional jets from Brazilian jet maker Embraer.

Those jets will allow Air Canada to introduce its transcontinental service to smaller communities, edging in on WestJet's market, with the winner ultimately being passengers able to cash in on cheap flights.

Neither Air Canada nor WestJet, the nation's Number 2 carrier, has announced year-end results. Air Canada's parent, ACE Aviation Holdings Inc., reported an $81 million (Canadian) loss in the third quarter, citing $313 million for restructuring. Passenger traffic climbed 11 per cent from a year earlier.

270234-186899.jpg | Dick Loek toronto star file photo Air Canada aircraft taxi along the tarmac at Pearson International Airport. After emerging from bankruptcy protection, Canada's flag carrier has about a two-year lead on its international competitors and will soon have an advantage over its domestic rivals, says analyst Rick Erickson.

Air Canada shops around for 767 replacement
01 February 2005
The Globe and Mail

Air Canada is considering either the Boeing 7E7 Dreamliner or the Airbus A350 as the wide-body aircraft to eventually replace its fleet of aging Boeing 767s. Once Montreal-based Air Canada picks the replacement model, it will set the wheels in motion to order new aircraft for gradual delivery starting in 2010, spokeswoman Laura Cooke said yesterday. Canada's flag carrier had 42 Boeing 767s in its international fleet at the end of last year.

By Bernard Simon
Published: January 31 2005 02:00 | Last updated: January 31 2005 02:00

Air Canada plans to order about 50 wide-body aircraft later this year for its expanding international network, writes Bernard Simon.


The Montreal-based carrier, which emerged from a court-supervised restructuring last October, is one of the few traditional North American airlines replenishing its fleet. While most US carriers remain in deep financial difficulty, Air Canada is forecasting an operating profit of about C$1.6bn (US$1.28bn) this year.

The Canadian carrier used the restructuring to cut its debt from C$12bn to C$4bn, and to raise C$1.1bn in new equity. With the bulk of its debt and lease obligations denominated in US dollars, Air Canada has also benefited from a sharp rise in the Canadian dollar.

Robert Milton, chief executive, said the airline was likely to order either the Boeing 7E7 Dreamliner or the Airbus A-350, each with a capacity of about 250 passengers. The new aircraft will replace an ageing fleet of wide-body Boeing 767s.

The 7E7 is due to enter service in 2008. Airbus's shareholders gave the go-ahead for the A-350 last month, with a target introduction date of 2010.

Air Canada is already bumping into capacity constraints as it expands its international services, especially to Asia and Latin America.

It has recently brought two mothballed 767s back into service and is leasing several used 767s and long-range Airbus A-340s.

The carrier will also start taking delivery later this year of 105 Embraer and Bombardier regional jets to improve flexibility.

Air Canada January Traffic Improves

February 3, 2005

Air Canada flew fuller planes in January than a year earlier, the airline said on Thursday.

Air Canada, the country's major carrier, said its January traffic, measured by revenue passenger miles, rose 6.2 percent on a 1.5 percent decline in capacity from a year earlier.

Its passenger load factor rose 5.7 percentage points to 77.7 percent from 72 percent in January 2004 and was at its highest level on record for the month.

Montreal-based Air Canada, the operating arm of ACE Aviation;, said January was the 10th straight record month for its load factor. The airline emerged at the end of September from 18 months of bankruptcy protection, with a much lighter debt load, some 10,000 fewer workers and pared back aircraft capacity.

(Reuters)

Air Canada eliminates rates for bereaved traveIlers; offers discount rates

Nelson Wyatt
Canadian Press

February 3, 2005


MONTREAL (CP) - Air Canada has phased-out special rates for bereaved travellers due to low demand in favour of cheaper and more simplified fares, the airline said Thursday.

The move didn't impress competitor WestJet, which called it "insensitive," or lobby group Transport 2000. But it's supported by the Tourism Industry Association of Canada, which said the impact on travellers will be minimal. Isabelle Arthur, an Air Canada spokeswoman, said the new system is better and easier for consumers.

"We were getting less and less and less requests for these special fares," she said. "People in special circumstances would just go on the Web and book because they saw it was a lower fare than what would be offered as a bereavement (fare) and it had more flexibility," she said.

The previous system was gradually dropped in fare restructuring announced in 2003. Bereavement fares ended on Jan. 31.

Under the old system, mourners received 75 per cent off the price of their ticket and had to buy a return ticket with set dates.

"Now with our simplified low-fare structure, we have lower fares than the previous discounts did, more flexibility because the customer can buy just a one-way (ticket) because maybe they're not sure when they're coming back, this at all times right up to the date of departure."

The reduced rates, which are only for domestic flights, also apply when the traveller returns.

Arthur said a few travellers have complained they didn't get the low fares in some communities when they had an illness or death in the family and the airline is looking their cases.

"We will ensure there is consistency across the network."

The new fare system will be extended "in the near future" to international travellers, who will book under the old system until the new one is implemented, Arthur said.

The new structure didn't impress Calgary-based WestJet. It has no plans to eliminate its bereavement fare. The carrier offers bereaved travellers between 30 and 50 per cent off the full walk-up fare.

Don Bell, WestJet's executive vice-president of guest services, said customers have told the airline they appreciate the special fare.

"The seat sale price might be cheaper than the bereavement fare or as cheap, but we'd always offer the lowest fare," he said. "As we move closer to the summer and the high travel period, those fares may go up but we'll still maintain our bereavement fares."

Bell said he didn't understand Air Canada's decision.

"They have their business to run. I don't quite understand their logic. It seems a little insensitive. It doesn't seem like the right thing to do."

David Jeanes of Transport 2000 the cheap seats sell quickly on popular routes and might not be readily available to bereaved travellers.

"These seats are strictly limited inventory and certainly on popular routes they're sold out well in advance," he said.

Air Canada reports best-ever January load factor: 77.7% of seats filled

Canadian Press

February 3, 2005


MONTREAL (CP) - Air Canada reported Thursday that 77.7 per cent of its seats were filled with paying passengers in January, up from a load factor of 72 per cent in the same month last year.

The airline said it was the highest load factor it has ever recorded in a January. Air Canada (TSX:ACE.RV), after downsizing under a court-supervised restructuring, said its overall capacity was 1.5 per cent less than in January 2004. But it flew 6.2 per cent more revenue passenger miles, according to preliminary figures.

It was the 10th consecutive month that Air Canada has posted a record load factor.

In the domestic market, Air Canada said capacity decreased 6.3 per cent while traffic increased 3.4 per cent, resulting in a load factor within Canada of 76.0 per cent, an improvement of 7.2 percentage points from a year earlier.

The Jazz regional subsidiary had a load factor of 67 per cent, up 13.2 points, as it cut capacity by 2.7 per cent but flew 21 per cent more revenue passenger miles.

Flights to and from the United States showed a load factor of 72.8 per cent, up from 64.2, while the transatlantic load factor jumped to 80.2 per cent from 72.7 per cent.

On Pacific flights - the only category aside from "other and charter" where Air Canada raised capacity, with a 2.3 per cent increase in available seat miles - the load factor edged up to 83.5 per cent from 83.2.

Other and charter capacity was boosted 22.2 per cent and revenue passenger miles grew 23.4 per cent, for a load factor of 77.2 per cent, up from 76.4.

Hey, is this just a news thread or can we actually talk about the airline to start bashing it? Air Canada SUCKS!!!! WESTJET ROCKS!!!!! ;)

Can talk whatever U like here man :)

Hey, is this just a news thread or can we actually talk about the airline to start bashing it? Air Canada SUCKS!!!! WESTJET ROCKS!!!!! ;)

Hey dude - I fully agree with you, however, AC still offers the business travellers some good stuff Westjet doesn't...a lounge, and points (I know Westjet has Air Miles now - but still not as good).

I fly every week, and (dammit) I still fly AC - despite terrible service (their worst problem...the same agents STILL don't seem to recognize me - or at least acknowledge it), the lounges are very cool and the Aeroplan points get you free flights fast.

I tried flying Westjet for a month or two early last year (likely out of guilt, since I live in Calgary). Despite way nicer staff, Westjet needs to get those satellite TV's in their seatbacks quickly (as the flight attendants were saying on those flights), finish getting rid of ALL those crappy 737-200s (or reconfigure them...no leg room), and allow for pre-selecting seats (I can't handle getting middle seats).

I really hoped AC would just die - or at least fire Milton, since I firmly believe its his direction that got AC to this position.

BTW - the flights are noticeably fuller from a year/year-and-a-half ago.

Air Canada Reports Tenth Consecutive Month of Record Load Factor in January

- Domestic passenger load factor at 76.0% - highest ever for January
- System passenger load factor at 77.7% - highest ever for January

Data : http://micro.newswire.ca/release.cgi?rkey=1302030467&view=13213-0&Start=0

MONTREAL, Feb. 3 /CNW Telbec/ - Air Canada reported a system load factor of 77.7 percent in January 2005, the highest ever for January. The mainline carrier flew 6.2 percent more revenue passenger miles (RPMs) in January 2005 than in January 2004, according to preliminary traffic figures. Overall, capacity decreased by 1.5 percent, resulting in a load factor of 77.7 percent, compared to 72.0 percent in January 2004; an increase of 5.7 percentage points. In the domestic market, capacity decreased by 6.3 percent while traffic increased 3.4 percent resulting in a domestic load factor of 76.0 percent - a 7.2 percentage point increase year over year.

Jazz, Air Canada's regional airline subsidiary, flew 21.0 percent more revenue passenger miles in January 2005 than in January 2004, according to preliminary traffic figures. Capacity decreased by 2.7 percent, resulting in a load factor of 67.0 percent, compared to 53.8 percent in January 2004; an increase of 13.2 percentage points.

"All of us at Air Canada are proud to begin 2005 with another record load factor, the tenth consecutive record month. Traffic rose a very strong 6.2 percent on 1.5 percent lower capacity with this reduction entirely centered within North America," said Montie Brewer, President and Chief Executive Officer. "Particularly gratifying is the domestic load factor for January of 76.0 percent, 7.2 percentage points above last year and also
another record. The continuing strong growth in domestic traffic further confirms the positive consumer response to Air Canada's new fare products which allow customers to choose the fare that best suits their needs. We are clearly the airline of choice with the lowest fares to the greatest number of destinations on an everyday basis."

The airline says a new system will be better and easier on consumers.


CP 2005-02-04 02:07:29


MONTREAL -- Air Canada has phased out special rates for bereaved travellers due to low demand in favour of cheaper and more simplified fares, the airline said yesterday. The move didn't impress competitor WestJet, which called it "insensitive," or lobby group Transport 2000. But it is supported by the Tourism Industry Association of Canada, which said the impact on travellers will be minimal.

Isabelle Arthur, speaking for Air Canada, said the new system is better and easier for consumers.

"We were getting less and less and less requests for these special fares," she said.

"People in special circumstances would just go on the Web and book because they saw it was a lower fare than what would be offered as a bereavement (fare) and it had more flexibility."

The previous system was gradually dropped in fare restructuring announced in 2003. Bereavement fares ended on Jan. 31.

Under the old system, mourners received 75 per cent off the price of their ticket and had to buy a return ticket with set dates.

"Now with our simplified low-fare structure, we have lower fares than the previous discounts did, more flexibility because the customer can buy just a one-way (ticket) because maybe they're not sure when they're coming back, this at all times right up to the date of departure."

The reduced rates, which are only for domestic flights, also apply when the traveller returns.

Arthur said a few travellers have complained they didn't get the low fares in some communities when they had an illness or death in the family and the airline is looking their cases.

"We will ensure there is consistency across the network."

The new fare system will be extended "in the near future" to international travellers, who will book under the old system until the new one is implemented, Arthur said.

Meanwhile, Air Canada reported yesterday that 77.7 per cent of its seats were filled with paying passengers in January, up from a load factor of 72 per cent in the same month last year.

The airline said it was the highest load factor it has ever recorded in a January.

Air Canada to benefit from U.S. visa requirement: analyst


Last Updated Sun, 06 Feb 2005 14:43:42 EST
CBC News

CALGARY - A U.S. anti-terrorism measure could provide a big gain for Air Canada, an airline analyst says.

The U.S. now requires travellers who change planes in the U.S. to get a visa, even if they don't leave the airport, says Rick Erickson, an independent Calgary-based analyst.

But travellers en route between Asia, Europe and South America who might transfer in the U.S. are now looking at Canada, where there is no comparable requirement.

That could be worth up to $350 million US for Air Canada, and even more if international flyers break their trip to spend a few days in Toronto or Vancouver, he said.

Air Canada is extending its routes in Latin America and to Asia, partly to take advantage of the U.S. visa requirement.

The airline announced a 16 per cent increase in China-Canada seat capacity in January.

"Combined with our major expansion of services throughout Latin America, also via our Toronto hub, Air Canada offers international travellers between Asia and South America the added convenience of avoiding U.S. transit visa requirements," president and CEO Montie Brewer said at the time.

For some travellers, changing planes in Vancouver or Toronto could replace making connections in Los Angeles or New York. http://www.cbc.ca/gfx/pix/bizlogo_aircan_newtail.jpg

Air Canada Flies Fuller Planes in January


Thu February 3, 2005 5:09 PM GMT-05:00

MONTREAL (Reuters) - Air Canada flew fuller planes in January than a year earlier, the airline said on Thursday.

Air Canada, the country's major carrier, said its January traffic, measured by revenue passenger miles, rose 6.2 percent on a 1.5 percent decline in capacity from a year earlier.

Its passenger load factor, which gauges the average number of seats sold as a proportion of those available, rose 5.7 percentage points to 77.7 percent from 72 percent in January 2004 and was at its highest level on record for the month.

Montreal-based Air Canada, the operating arm of ACE Aviation Holdings Inc., said January was the 10th straight record month for its load factor. The airline emerged at the end of September from 18 months of bankruptcy protection, with a much lighter debt load, some 10,000 fewer workers and pared back aircraft capacity.

ACE Aviation's restricted voting shares fell 10 Canadian cents to C$33.50 on the Toronto Stock Exchange on Thursday

New PR fiasco for Air Canada
Pilots' union lodges complaint over CEO's 'malicious' book
Airline says it will fight charge if regulator hears complaint
Rick Westhead
Toronto Star
7 February 2005

The union representing Air Canada's pilots has lodged a complaint against the airline with the Canada Industrial Relations Board, accusing chief executive Robert Milton of writing "malicious inaccuracies" about the union's executives in a recently-published book.

The Air Canada Pilots Association, which represents 3,000 of the carrier's pilots, contends that in Straight From the Top: The Truth About Air Canada, which was published last October, Milton was overly critical of the union's leadership during a 1998 two-week strike that cost the airline $250 million and later in negotiations to wring savings from Air Canada's unions.

The pilots lodged their complaint last week, sources told the Star.

The complaint marks the latest public relations fiasco for Milton and the airline's executives, who once more find themselves at odds with one of their most powerful unions less than six months after emerging from bankruptcy protection.

A spokesperson for the industrial relations board said it would take several weeks for the regulator to decide whether to hear the complaint, filed last week in Ottawa.

While the board doesn't have the ability to fine Air Canada, it could issue a cease-and-desist order aimed at preventing Milton from making any further derogatory comments about the pilots' union or its members.

Union president Kent Wilson said in an interview that Milton wrote "inaccuracies that were incorrect and malicious" about the pilots' union and that he had called into question "the integrity of ACPA's leadership." Some passages in the book are an effort by Milton to create division between the union's executives and its members, Wilson said.

An Air Canada spokesperson said the complaint was without merit and that the airline would fight the charge.

The union is expected to hold a conference call this morning to tell its members about its decision to file a complaint with the industrial relations board.

In his 257-page book, which details Onex Corp.'s failed takeover of Air Canada and Air Canada's search for a financier to provide money to help the carrier emerge from bankruptcy protection, Milton refers to Air Canada's two-week pilots' strike in 1998 as a "major calamity."

"Too often, reasonable arguments by management were spun into outrageous and untenable positions when passed on to union members, often by leaders who retained their position through acclamation and were disconnected from the concerns of both management and employees," Milton wrote about labour relations.

In 1998, "our pilots were being represented by their newly formed union, ACPA," Milton wrote. "ACPA was formed by our pilots for the right reasons, including improving the relationship with the company and being more of a grassroots organization that better listened to and represented its members. Looking back on that period, I think the relative 'newness' and inexperience of the leaders of the new union worked against us all ... The strike revealed the manner in which union leaders can and often do employ their own personal agenda to sway the operations of an entire company."

One specific anecdote that has ACPA executive bristling is Milton's recollection of a union leader, a former Boeing 767 captain.

The pilot "was scheduled to handle an Ottawa-to-London flight just before the (1998) strike deadline. Our crew scheduling people, knowing that this guy wanted to exert as much pressure as possible on the company, confirmed and reconfirmed with him that he would show up for the flight. He said he would but he did not, delaying the takeoff for several hours while a replacement pilot was located and brought to the airport, inconveniencing a couple of hundred Air Canada customers."

While Milton said he found that kind of behaviour "totally unacceptable," it remains "representative of the tactics many union leaders are all too often willing to employ."

ACPA's complaint is just the latest example of how sour relations between Air Canada and its 30,000-member workforce continue to be, even after the airline emerged from insolvency in September.

In October, the union representing Air Canada's customer service workers had to tell members that 185 of its 1,200 workers at Pearson Airport were about to be laid off - a day before the airline signed diva Celine Dion to a multi-million-dollar endorsement.

In December, the airline threatened to smear the credit rating of as many as 5,000 Air Canada flight attendants if they didn't pay back allegedly overpaid meal expenses.

And last month, thousands of passengers were stranded when 800 Air Canada baggage handlers and ramp workers walked off the job in a wildcat strike after the company distributed a memo announcing it was investigating alleged time-sheet padding.

274719-190036.jpg | ANDREW VAUGHAN cp file photo Air Canada CEO Robert Milton is accused of writing "malicious inaccuracies" about the pilots' union's executives in a book last year. Sour relations between Air Canada and its 30,000-member workforce continue to dog the airline.

Pilots move points to more Air Canada labour trouble
Pilots complain over Milton book shows continued 'ill will'
Chris Sorensen
Financial Post
8 February 2005

A complaint by one of Air Canada's most powerful unions about allegedly "malicious" passages in chairman Robert Milton's recent book suggests a history of troubled labour relations continues to haunt the restructured airline.

"It's indicative of a fair bit of ill will between the unions and senior management," said Karl Moore, a professor at McGill University, who follows the industry.

"It's an area they have to clearly make progress on to get a common focus on beating the competition."

The Air Canada Pilots Association, a body that represents some 3,100 of the airline's pilots, filed a complaint last week with a federal tribunal, claiming that Mr. Milton's book -- Straight From the Top: The Truth About Air Canada -- portrays the union's leaders in an unnecessarily negative light.

Mr. Milton, the chairman of ACE Aviation Holdings Inc., the holding company for the restructured airline, described in the book events surrounding a two-week strike in 1998 and negotiations during the carrier's recent restructuring that sought to extract more than $1-billion in concessions from the airline's unions.

"The association wants to protect the integrity of its officers and so exception was taken to those comments," said Peter Foster, a spokesman for the pilot's association.

"We allege that the comments there are inaccurate, untrue and in some cases malicious," Mr. Foster said.

The Canadian Industrial Relations Board has yet to decide if it will hear the complaint.

A spokeswoman for Air Canada said the union's complaint will be "vigorously contested" by the airline.

The complaint comes on the heels of a disruptive wildcat strike by Air Canada ground workers last month that cancelled more than 100 flights and stranded thousands of passengers. The striking employees, members of the International Association of Machinists and Aerospace Workers, were protesting a company investigation of employee time card abuses.

Several analysts have wondered aloud whether such "isolated" incidents point to larger problems brewing at Air Canada, which has posted record load factors, or percentages of seats filled on flights, for the past 10 months.

"A sense of resentment and entitlement still lurks behind Air Canada's culture," said Ben Cherniavsky, an analyst at Raymond James Equity Research, in recent report.

"We are convinced that getting labour's interest aligned with customers' and shareholders' will be one of the greatest challenges going forward," the analyst said.

Air Canada opens new Maple Leaf Lounge at the Infield Terminal at Toronto Pearson Airport

MONTREAL, Feb. 10 /CNW Telbec/ - Air Canada will officially open its newest Maple Leaf Lounge at the Infield Terminal at Toronto Pearson Airport on February 10, 2005. The Infield lounge boasts 6,566 square feet, clean architectural lines, and wall-length windows providing customers with a bird's eye view of airfield activities, while they relax in comfortable, leather-backed chairs.

Air Canada's Maple Leaf Lounges are designed to make the time prior to boarding relaxing and to offer premium customers an unrivaled level of service in a quiet and comfortable setting away from busy airport common areas. "The new Infield Lounge now offers our eligible overseas customers a relaxing environment conveniently co-located with international gates at the Infield Terminal. The design, services, view and amenities offer our premium passengers an environment that will meet all their expectations," said George Reeleder, Senior Director, Marketing for Air Canada.

Air Canada is proud to have partnered with a variety of high profile sponsors to provide customers with a unique and first class experience. The new lounge will feature:
- Over 100 seat capacity
- Xerox Business Centre with individual work areas for travellers to maximize productivity
- IBM flatscreen personal computers
- Xerox business equipment, including the latest model fax machine, copier, and Phaser solid ink colour printer
- Bell high speed Internet
- Bell's Access Zone wireless Internet throughout the lounge
- Sony Entertainment, including a state-of-the-art large screen TV
- Magazines & newspapers
- Shower facilities
- Light snacks and beverages (including complimentary beer, wine & spirits)
- Complimentary local phones & (credit card) long distance phones

The Toronto Infield Lounge becomes the third Maple Leaf Lounge at Toronto Pearson Airport complementing existing lounges at New Terminal One and the Transborder Lounge at Terminal 2. Air Canada features a total of 19 Maple Leaf Lounges located at all major airports across Canada and key international stations as well as an arrivals lounge in London Heathrow. In co-operation with its Star Alliance partners, Air Canada offers customers access to over 500 airport lounges worldwide. More than two million customers visit Air Canada's award-winning lounges every year.

Photos : http://www.aircanada.com/en/about/media/facts/logo.html

New Union Battle At Air Canada Is Over Passages In Chief's Book
By IAN AUSTEN
14 February 2005
The New York Times

Even though Air Canada recently emerged from bankruptcy court protection, relations between the airline and its unions remain testy. Last month, for example, a disciplinary dispute led to a wildcat strike and briefly shut down the airline's main hub in Toronto.

Now the antipathy between the two sides has entered a new forum: literary criticism.

''Straight From the Top: The Truth About Air Canada,'' the recently published autobiography of Robert A. Milton, the chairman and chief executive of Air Canada's parent company, ACE Aviation Holdings, included some unflattering observations about some pilots and their union.

In response, the Air Canada Pilots Association filed a formal complaint this month with the Canada Industrial Relations Board about how it and its members are portrayed in Mr. Milton's 266-page book.

''There are inaccuracies in the book that in some cases are malicious and untrue,'' said Peter Foster, a spokesman for the union, which has about 3,100 members.

Until the labor board reaches a decision, which may take months, the contents of the complaint remain confidential. And neither Mr. Foster nor anyone at Air Canada, which is based in Montreal, will offer any details about the filing.

Sprinkled throughout the life story of Mr. Milton, an American who grew up in Belgium, Lebanon, England, Singapore and Hong Kong, are numerous negative comments about Air Canada's unions and their leadership. At one point he suggests that a unnamed pilot who was a negotiator for the union proposed a new method for evaluating flight skills because he ''feared failing future check rides and thus losing his job.''

John Reber, a spokesman for Air Canada, declined to comment beyond saying that the union's complaint, whatever it may be, ''is without merit.''

Exactly what the union wants the labor board to do about the book has not been disclosed.

Christopher Waddell, a director of PEN Canada, an advocacy group for free speech, said that it was inappropriate for any labor body to judge books by airline executives or anyone else.

''The strange part of this story is that the labor relations board wouldn't have laughed this out of its office,'' said Mr. Waddell, who is also a journalism professor at Carleton University in Ottawa. ''If the union has a problem, we have laws on libel and slander in this country.''

Rob Sanders, Mr. Milton's publisher and the head of Greystone Books in Vancouver, said that no one from the union or the labor board had contacted his office. He said he was unsure what, if anything, the publishing house could do about the labor board process.

''This is a back-door attempt to get at somebody,'' Mr. Sanders said.

Air Canada unveils new Pearson lounge

Air Canada unveils new Pearson lounge
Wednesday, February 16, 2005 - Page R10

Air Canada launched its newest Maple Leaf Lounge at Toronto Pearson International Airport last week. The 6,566-square-foot space in the Infield Terminal features wall-length windows, a business centre and wireless Internet access throughout. Other amenities include a large-screen TV and shower facilities, as well as light snacks and beverages including complimentary beer, wine and spirits.

Airline group seeks new union
Regional flight attendants want to bolt Teamsters.
'Full-out war' expected in Air Canada dispute
Rick Westhead
Toronto Star
22 February 2005

A splinter group of 377 flight attendants who work Air Canada's regional routes has filed an application to sever ties with the powerful Teamsters union and start a new bargaining group, the latest sign of labour discord at Canada's largest airline.

The group, which calls itself the Regional Flight Attendants' Union (RFAU), filed an application with the Canada Industrial Relations Board in Ottawa in late January.

The prospective union purports to represent about 70 per cent of the 555 Air Canada employees now represented by the Canada Council of Teamsters.

The application sets the stage for a "full-out war," one official with the flight attendants union said, between the Teamsters and flight attendants who have become disenchanted with the well-known union since it began representing regional flight attendants following Air Canada's merger with Canadian Airlines in 2000.

"The Teamsters spend a lot of money campaigning and pretty much nothing on representation," said Joslyn Dicks, a flight attendant who filed the application with the industrial relations board.

"We're in a situation where business managers are representing us who know nothing about our business," Dicks said. "We want flight attendants to represent flight attendants. It's bad enough that in one situation, I had to explain to one of these business managers what an RJ (regional jet) is."

Dicks said the flight attendants hope the industrial relations board will hold a hearing on their application late this week or next week.

Teamsters representatives didn't return calls yesterday seeking comment. The union's agreement to represent the flight attendants is scheduled to run through June 30, 2009, according to the flight attendants' application.

In documents filed with the industrial relations board, the Teamsters - who represented employees with Air Canada regional unit Air B.C. before the merger in 2000 - have argued the upstart flight attendants union isn't a true trade union and has not signed up at least 50 per cent of Air Canada's regional flight attendants.

The Teamsters also argue the recently filed application isn't timely under Canada's labour rules and that material circulated to prospective bargaining unit members indicates the union's purpose is to "merge with a strong Canadian union."

The Teamsters union has asked the labour relations board to order the flight attendants union to produce notes, emails, letters and meeting minutes that might indicate whether it was planning to merge with one of Air Canada's other unions, such as the Canadian Auto Workers, which represents reservation agents.

The attendants union and Teamsters also differ over how many members the union currently represents.

Since an Oct. 1, 2004, system-wide seniority list indicates there are 1,074 employees in the bargaining unit, the Teamsters said in documents, "it is entirely unclear what the basis is for the applicant's assertion that there are only 555 flight attendants in the bargaining unit."

Dicks said the difference was because the Teamsters account for employees who have been laid off - even if it doesn't appear likely that they will be recalled.

While one of Air Canada's smallest labour groups, the carrier's regional flight attendants stirred up controversy last year. Dicks said a number of regional flight attendants were unhappy with the way the Teamsters represented them in negotiations last year with Air Canada.

"They held a gun to our heads," Dicks said.

The regional flight attendants' complaint is the latest in a series of recent labour problems at Air Canada.

Last month, the union representing Air Canada pilots filed a complaint with the industrial relations board over allegedly disparaging comments made about the union's executive by Air Canada chief executive officer Robert Milton in his book, Straight from the Top: The Truth About Air Canada.

Air Canada Urges Governments to Modernize 1995 Canada-U.S. Open Skies Agreement
24 February 2005


Air Canada today urged the Canadian and U.S. governments to accelerate plans to modernize the 1995 Canada-U.S. Open Skies Agreement by progressively removing restrictions in order to create a fully integrated common air transport market in North America.

"We are encouraged by Minister LaPierre and Secretary Mineta's commitment to renewed discussion to modernize the 1995 agreement," said Robert Milton, Chairman, President and Chief Executive Officer, ACE Aviation Holdings Inc.

"It is time for Canada and the U.S. to take the necessary steps to build on the successes of the 1995 Open Skies Agreement by moving to an unrestricted, single aviation market that will generate more choices for consumers and create a healthier North American airline industry. The 1995 agreement was a great start, but it is quickly becoming outdated and if left unattended, risks being entirely out of step with current market realities and airline policy in competing jurisdictions.

"In recent years, we have seen unprecedented upheaval in the airline sector. International alliances have grown in importance, security and transit issues remain top of mind, the U.S. and the EU have entered into full-fledged Open Skies negotiations and legacy carriers throughout the world are going through difficult and lengthy restructurings. North American carriers are taking aggressive steps to become more efficient and to reduce costs but need policies that will support the long-term health of the sector.

"This past 10 years has shown us that the liberalization of air policy between our two countries has been a resounding success for consumers and for carriers, unleashing impressive growth opportunities in the Canada-US air travel market on both sides of the border. In fact, prior to the 1995 Agreement, Air Canada served only nine mainline and five regional carrier scheduled destinations in the U.S. Today Air Canada, Air Canada Jazz and its commercial partners operate more than 385 non-stop flights per day on 79 routes to and from 49 U.S. and 6 Canadian points.

"We must not lose the momentum we have worked so hard to achieve through the 1995 agreement. We look forward to getting back to the table with our largest trading and aviation partner to develop the Open Skies Agreement our two countries deserve."

[bAir Canada union to fight Jazz plan[/b]
WebPosted Feb 25 2005 05:17 PM AST
CBC News

FREDERICTON — Changes in Air Canada's regional service could lead to a fight with its unionized employees in New Brunswick.

A division of the airline called Air Canada Jazz is taking over all of the operations in Moncton, Saint John and Fredericton.

Air Canada says passengers won't see much difference. The same planes will be used and there won't be a change in the schedule, except in Moncton where a new flight to Montreal is being added.

But Air Canada workers in New Brunswick will be affected by the plan.

An airline official says they'll have three options: transfer to other locations at the company's expense, accept a severance package, or seek employment with Jazz.

Sari Sairanen, a union representative for customer sales and service agents, says Air Canada made the move without consulting the employees.

In addition to that, Sairanen says their current collective agreement allows the agents to stay where they are.

"According to the employer it's going to change," said Sairanen. "We're saying, no it's not. We're going to have a fight on our hands."

Sairanen says the union will be discussing the Jazz announcement with its members over the next few days.

She didn't know how many employees in the Maritimes would be affected.

An official with Air Canada Jazz says it plans to hire more than 100 new airport employees to support operations at nine airports across the country.

But the number of positions for each location hasn't been identified yet.

Premier worried about changes to Air Canada flights

Broadcast News
Friday, February 25, 2005


SASKATOON - Saskatchewan Premier Lorne Calvert is concerned about what the changes at Air Canada will mean for his province.

Effective October 1st, Saskatchewan will be dropped from Air Canada's mainline route system.

The move will leave Regina and Saskatoon served by Jazz, the airline's regional service.

Calvert says that, if the move means fewer direct flights to larger centres, it could have an economic impact on Saskatchewan.

Air Canada says customers will get faster jet service to destinations such as Calgary and Winnipeg, which now use Jazz Dash-8 turboprops.

Saskatoon will have 300 guaranteed seats each day to Toronto on four flights when Jazz begins flying the new 75-seat Bombardier aircraft.

Regina will have three direct flights to Toronto.

Air Canada leaving P.E.I.
Last Updated Feb 25 2005 04:08 PM AST
CBC News


CHARLOTTETOWN – Air Canada is ending service to Charlottetown on May 3, moving flights to its Jazz regional carrier, and leaving 26 employees with an uncertain future.

According to the airline, Jazz service to Charlottetown will be increased, with two new flights being added. Smaller planes will make three daily flights to Montreal and two daily flights to Toronto.

At the Charlottetown airport 26 employees will be affected by the changes, but Charlottetown is not alone in losing the main airline. Fredericton, Moncton, Saint John, Quebec City and Thunder Bay will lose Air Canada service in May.

Regina, Saskatoon and Whitehorse will have Jazz-only service starting in October.

The change affects 330 jobs across Canada
Air Canada spokesperson Laura Cooke said the move would affect 330 employees, but said that didn't necessarily mean 330 layoffs. She said some employees could opt to transfer to other airports at the airline's expense. Others might be able to bump lower seniority employees at the main carrier. Others could take a severance package.

No pilots or flight attendants are on the list.

Air Canada promises 'seamless' transition

"An expanded Air Canada Jazz regional jet fleet will allow us to realign our network to ensure that we deploy the right aircraft type to meet travel demand in each market we serve," said Air Canada vice president Ben Smith in a release.

When Air Canada was in creditor protection, it negotiated agreements with unions to allow for the transfer of capacity to Jazz.

"The realignment of Air Canada's domestic network is a key component in its business plan," said Air Canada Jazz CEO Joseph Randall.

"This change increases the efficiency and strengths of the North American network while Air Canada pursues new international opportunities," he said.

Air Canada said the transition to exclusively Air Canada Jazz operations in the nine cities would be "seamless to customers."http://pei.cbc.ca/gfx/PEI/photos/pei_tarmac.gif

Air Canada's Jazz Spreading Its Wings In New Role
By Monica Gutschi
28 February 2005

HALIFAX, N.S. (Dow Jones)--For more and more communities across Canada, regional airline Jazz will become their main - if not only - air link to the rest of the world.

Jazz is moving to fill the gap left by sister company Air Canada, which is slowly reducing its domestic capacity. Air Canada, the country's dominant carrier, emerged from bankruptcy protection last fall with a new focus on transcontinental and international routes.

As Air Canada's new strategy evolves, "we are becoming a far more relevant part of that plan and a more critical part of that plan," says Jazz's chief executive Joe Randell.

Only last week, Air Canada announced it would eliminate service to nine mid-sized cities by the end of the year, leaving Jazz to provide them with air connections using its growing fleet of regional jets. The cities include such regional centers as Quebec City, Regina, Sask., Moncton, N.B., and Whitehorse, in the Yukon Territory.

The move cuts 330 jobs from Air Canada, many of which will be transferred to Jazz - albeit at lower rates.

As part of the comprehensive restructuring undergone at Air Canada during its 18 months in creditor protection, wage scales and working conditions at Jazz were renegotiated in much the same way as they were at the larger carrier. But there were key differences in the partnership forged between the sister airlines by the newly formed parent company Ace Aviation Holdings (ACE.B.T).

Jazz was assigned to operate the company's smaller aircraft - its Dash 8 turboprops and its CRJ regional jets - none of which seat more than 75 passengers. Pilots and crews who fly those aircraft are paid at a correspondingly lower scales.

Air Canada will operate the fleet of wide-bodied aircraft and the company's larger regional jets built by Brazil's Embraer S.A. (ERJ) that seat up to 100 passengers.

Most importantly, Jazz moved to a capacity-purchase agreement with Air Canada from a prorated revenue system. Under the new deal, Jazz supplies capacity to the larger airline for a set price, with Air Canada determining the routes and frequencies. Previously, Jazz collected revenue from the routes it flew, and thus assumed the implied risks if load factors declined.

The new deal "is a far more disciplined approach in terms of the business arrangement," Randell says, and closely mimicks the partnerships between U.S. regional carriers and the larger legacy airlines.

Like the U.S. regional carriers, Jazz is also free to fly for any other airline. However, Canada's air market is so small it's unlikely to work with Air Canada's direct competitors, such as WestJet Airlines Ltd. (WJA.T) or Jetsgo. "There are opportunities for us, but they are limited," Randell says. That may change if Canada and the U.S. sign a new "Open Skies" agreement, allowing Jazz to bid on transborder routes for U.S. carriers. For now, though, Jazz's principal work, aside from supplying Air Canada, is flying resource-related charters.

"Within the market niche that we serve, we are the most competitive (in terms of costs)," Randell says. "We're feeling pretty good about that."

New Fleet Opens New North American Markets

It's a long way to have come in just the few years that Jazz has existed after being forged from a hodgepodge of smaller regional airlines. When the former Air Canada Regional Inc. was created in 2001 from an amalgamation of AirBC, Air Nova, Air Ontario and Canadian Regional, it had five aircraft types and 24 union agreements. Antitrust regulations limited layoffs, base closings and service reductions.

A fully merged, if cumbersome, and renamed airline, Jazz was finally launched in early 2002 - only months after the Sept. 11, 2001 terrorist attacks devastated the North American air industry. Then, when the Iraq war and the SARS viral outbreak further battered Air Canada, Jazz was dragged into the bankruptcy process and forced to restructure the operations and working arrangements just completed.

Now, Jazz has five labor deals and its fleet comprises only two aircraft types: Dash 8 turboprops and the regional jets built by Canada's Bombardier Inc.

Meanwhile, after years of shrinking, Randell says Jazz is now in a phase of "dramatic" expansion.

The company has 3,400 employees and is hiring more; it operates 553 daily flights and is increasing frequencies out of Toronto and in western Canada; it carries about 5.5 million passengers a year and has annual operating revenue of about C$800 million.

In addition, Air Canada is transferring 25 of its existing 50-seat CRJ200s to Jazz, and the smaller airline has ordered 15 of the new, larger CRJ705s to be delivered this year. Fifteen more are to be delivered next year.

Those planes will replace many of its aging BA146 aircraft, with Jazz expected to have a fleet of 125 planes by the end of 2007, compared to 96 now.

With the expanded regional jet fleet - including the longer-range CRJ705s - Randell says Jazz will have a unique market niche in Canada. "We can offer more frequencies with smaller airplanes," he says, making it an ideal choice for commuter routes between large urban centers. As well, it can provide Air Canada with lower-cost capacity on longer-haul routes where the market is small, but key - Calgary to Houston, as an example. It will also continue to serve more remote communities with its smaller turboprops, and offer more frequent service to the country's mid-sized centers. "We can go anywhere where that (smaller-sized) equipment makes sense," Randell says.

And all of those routes will feed into Air Canada's huge international network, giving Jazz an important role to play in the larger airline's transformation.

Air Canada's jumbo A340 flying between Toronto and New Delhi, "will need more than just people from Toronto" to fill its 282 seats, Randell points out. "Hopefully, we'll see even more services and more opportunities as Air Canada grows its international network."

Air Canada rules called 'ridiculous'
Minister firm on coming legislation; Companies created by restructuring must be bilingual, stay in Montreal

NICOLAS VAN PRAET
The Gazette

Tuesday, March 01, 2005


Canada's transport minister said yesterday the Liberal government will introduce a bill within days requiring the companies created by Air Canada's restructuring to remain bilingual and keep their headquarters in Montreal.

Jean Lapierre said legislation is imminent requiring the airline's holding company and its units to fulfill the two requirements, first imposed on Air Canada as a condition of its privatization in 1989.

Air Canada said yesterday only that it intends to comply.

"Air Canada will remain bilingual and will stay in Montreal," airline spokesperson Isabelle Arthur said.

In the past, the company's executives have been more vocal, saying their domestic competitors should also be subject to the same language requirements. They argued being bilingual costs money and represents an obligation rivals don't have.

One analyst took up that position yesterday, adding he believes that if and when any of Air Canada's units are sold, the law could make finding potential buyers more difficult.

"It's a totally useless legislation," said Jacques Kavafian, who researches the aviation sector for Research Capital Corp.

"It's ridiculous to basically tie one guy's hands behind his back and then say: 'Well, go ahead and compete.' "

The Air Canada bill fulfills a promise the Liberals made during the last election campaign.

The issue exploded after Conservative leader Stephen Harper's office wrote a letter saying a Tory government would scrap the law obliging Air Canada to offer services in English and French and keep its head office in Montreal.

Lapierre and other prominent Liberals then staged a news conference outside Air Canada headquarters and promised to uphold the law.

The Liberals say new legislation was made necessary by Air Canada's successful bankruptcy restructuring, which split the company into several business segments, each existing as separate legal entities. ACE Aviation Holdings Inc. is the parent holding company under which other units like Air Canada and Aeroplan operate.

"The status quo has to be maintained, no matter what the structure," Lapierre said yesterday after a speech to the Montreal Board of Trade.

"Everything that was subject to the Official Languages law before has to remain subject to it now."

Separately, the minister also said his government wants to ease restrictions on air transport between Canada and European Union nations and possibly India. He gave no time frame for any negotiations.

Lapierre and U.S. Transportation Secretary Norman Mineta said last week Canada and the U.S. will begin talks on a more liberal open-skies agreement between the two countries. Under the current agreement, airlines from either country are free to fly to cities in the other country, but not between those cities.

Feds work to keep AirCan bilingual New legislation in works to 'preserve' status quo, says transport minister
Canadian Press
01 March 2005

Nelson Wyatt MONTREAL -- The federal government is working on legislation to keep companies created by Air Canada's restructuring bilingual and their head offices in Montreal, Transport Minister Jean Lapierre said yesterday.

"We want to preserve the status quo on Air Canada," he said at a news conference after addressing a business luncheon.

Lapierre said the legislation, called the Air Canada Public Participation Act, will be ready soon but did not specify a time frame.

He also did not elaborate on its contents, saying, "When the bill is ready, we'll have all those technical details."

Lapierre's comments came as Air Canada transferred some mainline routes to its Jazz regional carrier starting with the summer schedule.

The airline said last week the realignment will allow Jazz to add non-stop flights and replace some turboprop aircraft with jets.

The transfer of regional jets to Jazz is part of agreements with unions reached during Air Canada's restructuring while under bankruptcy protection.

Air Canada emerged from bankruptcy protection last September after most of its debt was erased and shareholders lost all their investment.

Besides separate companies such as Air Canada Jazz and Aeroplan, Air Canada has created Air Canada Technical Services, Air Canada Cargo and Air Canada Groundhandling as separate entities as part of its restructuring.

Lapierre said yesterday the carrier's structure "has the air of a Christmas tree" and noted the main airline is "not a little box" in an elaborate structure.

Air Canada has said it plans to continue offering bilingual service because it's good business sense but has pointed out that operating in two languages is an expensive obligation its competitors don't have.

Lapierre didn't leave any doubts about his Liberal government's position on the issue.

"The principle of status quo -- period -- this is what's going to be respected," he said.

He said the government had been working on the bill since the election last June.

"I'm ready to table it as soon as possible."

In his speech, Lapierre reiterated his support for negotiations on a new "open skies" treaty between Canada and the United States.

Under the proposal, Canadians could use U.S. carriers to fly between Canadian cities within a few years and U.S. domestic air routes could be open to Canadian airlines.

"I call it open skies with open eyes," he said. "I believe Air Canada and WestJet and all the other companies are ready for the American market. They want to be part of this new global environment.

"We're not looking only at the States. We're looking at having open skies agreements with States, with the European Union, possibly with India and also I'm going down to China to try to also enlarge our deal with China because the potential there is great."

Air Canada Flight Attendants Question Uniforms
Josh Pringle
Wednesday, March 2, 2005

Air Canada flight attendants have filed a grievance over the new blue uniforms.

Celine Dion unveiled the new uniforms last fall when the airline emerged from bankruptcy protection.

The Canadian Union of Public Employees believes the airline is being too quick with its fashion judgement and wants more time to consider whether the look is right for flight attendants.

The airline says it wants to project an image of modern sophistication for passengers with its new blue uniforms to replace the old green and red scheme.

By April, Air Canada wants staff to start wearing the uniforms on selected flights.

^^ I read that in Globe and Mail today. Personally, I like the current one (old one).

Air Canada flies fuller planes in February

VANCOUVER, British Columbia, March 3 (Reuters) - Air Canada flew fuller planes in February compared with a year ago, the country's major carrier said on Thursday.

Montreal-based Air Canada said its February traffic, measured by revenue passenger miles, rose 1.6 percent on a 5.2 percent decrease in capacity from a year ago.

Its passenger load factor, which gauges the average number of seats sold as a proportion of those available, rose 5.3 percentage points year-over-year to 77.9 percent - its highest ever for the month of February.

Air Canada, which is the operating arm of ACE Aviation Holdings Inc. , said that February was its 11th consecutive record month for its load factor.

The airline emerged from 18 months of bankruptcy protection in September, armed with a lighter debt load, 10,000 fewer workers and pared back aircraft capacity.

Domestic Air Canada competitor WestJet Airlines Ltd. (WJA.TO) said earlier on Thursday that it filled almost 73 percent of its available seats in February, up from 67.4 percent a year ago.

ACE Aviation's restricted voting shares fell 43 Canadian cents to C$31.77 on the the Toronto Stock Exchange on Thursday. WestJet's rose 6 Canadian cents to C$10.91.

($1=$1.24 Canadian)

Air Canada expands online ticket service to include international flights
4 March 2005
National Post

Air Canada is expanding its online check-in service to include international flights. Beginning today, passengers flying to the United States or overseas can check-in and print their boarding passes from their home computers using Air Canada's Web site. The service, introduced last year for domestic flights, is an attempt to reduce long line-ups at airport ticket counters. Air Canada said it is planning to expand further the online check-in service to international flights bound for Canada. However, passengers travelling with luggage must still check their bags at airport ticket counters or at one of the airline's express baggage drop-offs.

London airport worker jailed for smuggling migrants into Canada

LONDON, March 4 (AFP) - An airport check-in clerk at London's main Heathrow airport was sent to prison for a year on Friday for helping to smuggle people into Canada.

Kulbinder Singh, 42, a mother of four who worked for Air Canada, turned a blind eye when illegal Asian immigrants from Britain boarded flights with fake passports.

"You were employed to check documents, a very important security measure in this day and age. You took money to do the opposite," said judge Richard Hayward at London's Old Bailey court.

He said Singh, from Hayes in west London, would have been jailed for longer had it not been for her family circumstances.

She was found guilty in January of conspiracy to obtain services by deception and remanded for sentence.

Fish-and-chip shop owner Omjeet Sidhu, 44, of Leicester in central England, was jailed for two years after being said to be one of the leaders of the conspiracy.

The judge told him: "It was done to evade this country's immigration laws which are already under considerable pressure."

Sidhu admitted the offence along with taxi company manager Deepak Bindra, 34, also of Leicester, who was jailed for 16 months for helping on two occasions.

Speculation Grows That ACE Aviation To Sell Aeroplan
By Monica Gutschi
07 March 2005

TORONTO (Dow Jones)--A growing number of observers believes ACE Aviation Holdings Inc. (ACE.B.T) is set to sell its Aeroplan loyalty program, reviving a plan that was put on hold two years ago when Air Canada slid into bankruptcy.

The most recent speculation comes from Robert Fay at Canaccord Capital, who issued a report Monday "in anticipation of a possible full or partial spinoff" of the country's most popular points program.

Jacques Kavafian of Research Capital also referred to a potential divestiture Monday, noting in a report on airline yields that he sees the sale of parts of Aeroplan, the regional airline Jazz, or the maintenance services division of ACE Aviation as "imminent."

And TD Newcrest analyst Brian Morrison said last week that he believed growth initiatives at Aeroplan "are being executed upon successfully, increasing the probability of a monetization of this asset (likely in part) within the next 12 months."

TD Newcrest owns ACE Aviation shares and Canaccord Capital expects to provide investment-banking services to the company in the next three months. Research Capital has no investment-banking relationship with ACE Aviation, and Kavafian doesn't own the company's shares.

All three analysts - and many of their peers - also agree that Aeroplan's valuation has soared since a deal to sell a 35% stake to Toronto-based Onex Corp. (OCX.SV.T) for C$245 million unravelled as Air Canada moved into creditor protection.

The changes made at Aeroplan during Air Canada's court-supervised restructuring have made it a more valuable entity, the analysts say, while the new corporate structure makes it that much easier to sell. Air Canada emerged from bankruptcy protection last fall as an operating subsidiary of newly formed holding company ACE Aviation. Aeroplan, Jazz, the cargo operations and the maintenance operations are also standalone units of ACE Aviation.

Fay values Aeroplan at about C$1.9 billion, at the high end of a range that other analysts have estimated at between C$1.35 million and C$2 billion.

"The profitability of Aeroplan has risen substantially" since the Onex deal was first announced in the fall of 2002, Fay noted, driven by the revised pricing under a new agreement with Canadian Imperial Bank of Commerce (BCM) and the addition of American Express Co. (AXP). Third-party revenues from such partners as electronics retailer Future Shop, a division of Best Buy Co. (BBY), communications company Bell Canada, part of BCE Inc. (BCE), and gasoline retailer Esso, a unit of Imperial Oil Ltd. (IMO), have also helped.

Fay also said Aeroplan has increased its cash revenues "substantially" in the last two years, and could continue boosting them by 10-15% annually going forward. Operating profits could grow by an even faster rate, he said.

The program now has more than 6 million members, and about 50,000 people join Aeroplan every month, he noted.

Aeroplan should have annualized revenue of about C$700 million in fiscal 2005, Fay said, with about 30% of that amount relating to Aeroplan Miles purchased by Air Canada.

No one from Air Canada was available to immediately comment, but the company has said in the past that it would consider selling part or all of Aeroplan, either as an income trust or a publicly traded company.

An Onex spokesman said the company would have "no comment at all" on the possibility of bidding for a part of Aeroplan, although Onex chairman Gerry Schwartz said recently he would consider it if the opportunity arose.

Dlouhy Merchant analyst Cameron Doerksen said speculation over the sale of Aeroplan is likely related to the expected release of Air Canada's fourth-quarter earnings this month. The quarter is the first reporting period since the airline's emergence from creditor protection, and the earnings are expected to include increased financial details of each of the different business units.

ACE Aviation Planning Two Financings - Report
08 March 2005

TORONTO (Dow Jones)--ACE Aviation Holdings (ACE.B.T) is planning two major financings to clean up its balance sheet, the Globe & Mail newspaper reported Tuesday.

The newspaper said the company - which is the newly formed parent of Air Canada - is set to announce a revolving line of credit for up to C$300 million. It said ACE is also preparing to publicly sell securities to pay down a US$425 million loan from GE Capital Corp., which financed the company's emergence from bankruptcy protection last year.

Citing unidentified market sources, the Globe & Mail said the proposals are expected to be presented to ACE's board Tuesday.

A spokeswoman for Air Canada said the company doesn't comment on market rumors.

The newspaper said the company wants to pay off the GE loan because of its high rate of interest. It also said that retiring the loan would give the airline more freedom to sell assets such as its loyalty program Aeroplan.

Analysts have pegged the value of Aeroplan at C$1-$1.9 billion.

Air Canada to join allies at new Paris terminal
Bloomberg News
09 March 2005
The Toronto Star

paris -- Air Canada, United Airlines, Lufthansa and other Star Alliance member carriers will move into a single terminal at Paris's Charles de Gaulle Airport by 2008, challenging rival Air France-KLM Group at its home base.

Aeroports de Paris, manager of the airport, is refurbishing Charles de Gaulle's Terminal 1 to improve the flow of travellers and add shops. Renovations will be finished by the end of 2008.

Ten of the 18 members in the Star Alliance already operate from the terminal.

Full-service carriers have turned to membership in airline groupings such as the Star Alliance, the world's biggest, to boost ticket sales by channelling passengers into each others' route networks and save money through shared ground facilities and joint purchasing.

The alliance's carriers will share check-in and ticketing counters in Paris. Members already operate under one roof at airports including Frankfurt, Munich, Vienna, Stockholm and Warsaw.

ACE reports quarterly profit
Air Canada parent earns $15 million
Rising fuel costs offset by currency gains
Sharda Prashad
Toronto Star
10 March 2005

Fresh out of bankruptcy protection, Air Canada's parent, ACE Aviation Holdings Inc., yesterday posted its first profit in more than two years, reporting net income of $15 million in its fourth quarter - compared with a loss of $768 million a year earlier.

In its first reporting period as a new publicly traded entity, ACE reported net income of 17 cents a share for the quarter ended Dec. 31, 2004, compared with a loss of $6.39 a share a year earlier. The prior-year loss included reorganization and restructuring costs of $560 million.

For the latest quarter, the company reported an operating loss of $3 million, compared with a loss of $77 million the previous year before restructuring, foreign exchange, interest and other costs.

"This was more or less in line with expectations," said Jacques Kavafian, airline analyst at Research Capital Corp. "I believe their costs are under control and their pricing (structure) is good."

Kavafian added that ACE can "charge a little more than the competition and people will still fly Air Canada" because of such perks as Aeroplan, the ability to book business class and having meals served on board.

"Fuel was the main issue for us this year," said ACE chief executive and chairman Robert Milton.

In the fourth quarter, fuel costs increased $142 million, but ACE was able to mitigate those high costs with a $98 million foreign exchange gain - versus a $7 million foreign exchange loss in 2003.

The number of miles flown by paying passengers increased 4 per cent to 9.74 billion and the amount earned from flying a passenger one mile - including Aeroplan passengers - was consistent with last year at 17 cents.

Fielding questions from analysts, Milton said that retiring a $425 million (U.S.) loan from GE Capital is a "first priority" for the company. The loan is considered one of the most expensive in the industry and restricts what ACE from can do with its popular Aeroplan program, which generated $41 million (Canadian) in revenue in the fourth quarter.

"ACE is examining a range of alternatives to maximize the value of its investment in Aeroplan for the benefit of all shareholders," Milton said.

Results for the full year were not released. However, Milton said the company exceeded its target for the year of $1.1 billion in earnings before interest, taxes, depreciation and aircraft rental. Milton said he is confident ACE will reach its target of $1.6 billion in 2005.

"They've benefited hugely," said Karl Moore, professor of management at McGill University, about the importance of bankruptcy protection in helping ACE turn around its situation. "They reduced their debt, decreased their head count and got wage concessions from the employees.... It signalled a change in the business model."

This year, ACE plans to cut 800 more jobs and only half of the 2,000 people expected to leave will be replaced.

ACE announced that Frank McKenna, former premier of New Brunswick, resigned from the board on March 1 because of his appointment as Canadian ambassador to the U.S.

Air Canada Passengers Become Ill from Anti-Freeze
Darren McEwen
Thursday, March 10, 2005

A woman remains in hospital and several other Air Canada passengers are recovering following a scary ordeal on board an Air Bus 319.

The airline says the Montreal bound plane left Winnipeg Thursday morning but had to return to the airport after passengers began complaining of sore eyes, throats and reported smoke in the cabin.

Air Canada says anti-freeze, used to de-ice the aircraft, may have got into the ventilation system.

Air Canada hits delay in closing nine bases
Judge's ruling prevents airline from negotiating layoffs
Series of union challenges also at issue in cost-cutting plans
Rick Westhead
Toronto Star
11 March 2005

An Ontario judge has temporarily scotched Air Canada's plans to close nine bases in cities such as Whitehorse and Thunder Bay, a move that would force as many as 330 employees to choose between moving to the carrier's larger offices or severing ties completely.

Ontario court judge Warren Winkler on Wednesday barred Air Canada from negotiating layoffs or prospective moves with reservation agents in affected cities until at least April 10, a source said yesterday.

Winkler told the airline and Canadian Auto Workers, which represents the company's customer service employees, that he would rule by March 31 whether employees should have the right to remain in affected cities to work for Air Canada's regional Jazz unit at their current rate of pay.

The CAW and the International Association of Machinists and Aerospace Workers, which represents ramp workers and baggage handlers, both filed grievances over the carrier's announced plans to shift operations in nine cities to its regional Jazz division

The IAMAW on Wednesday had a grievance hearing in front of Air Canada's chief arbitrator, Martin Teplitsky.

Teplitsky has told Air Canada and the machinists to resolve their differences before March 21.

He has scheduled hearing dates for March 24 or 25 and has said he would rule on the matter within two weeks of a hearing, a spokesperson for the union said.

Air Canada spokesperson Laura Cooke said that Winkler has asked Teplitsky to hold hearings with respect to both unions, although a union source said it's possible that one of the unions challenging Air Canada might succeed with its grievance while the other fails.

Closing the bases might allow the carrier to cut costs since Air Canada Jazz personnel, including pilots, flight attendants and baggage handlers, are paid less than their mainline cousins.

Air Canada has said it wants to make the switch on May 3 in Charlottetown, Fredericton, Saint John, Moncton, Quebec City and Thunder Bay and on Oct. 1 in Regina, Saskatoon and Whitehorse.

While affected employees would be given the chance to move to job openings in larger cities, the prospect for new openings is slim, union officials say.

Air Canada Adds Canada Flights In Response To Jetsgo Shutdown
11 March 2005

MONTREAL (Dow Jones)--Air Canada is adjusting its domestic Canada schedule to add flights between major cities across Canada in light of Jetsgo's sudden shutdown.

In a news release, the airline said it will add new daily round trip services between Toronto and Vancouver, Calgary, Winnipeg and Halifax in time for the peak summer travel season. Air Canada's increase in services will be implemented in stages across the country as plans are finalized, it noted.

In addition, Air Canada said it will increase its Rapidair shuttle service in the Toronto-Montreal-Ottawa corridor. Beginning this month, the carrier will boost service between Toronto and Ottawa with an additional 10 one way flights a week, for a total of up to 38 one way flights a day.

Air Canada is also boosting its schedule between Toronto and Montreal with an additional 22 one way flights a week for a total of up to 50 one way flights a day, it said.

Air Canada Plans Expansion Of Cargo Service To Asia
17 March 2005

MONTREAL (Dow Jones)--Air Canada intends to expand cargo services to China following the success of its dedicated freighter services within Canada and to Europe launched in 2004.

In a news release, Air Canada has signed a two year lease agreement with World Airways for an MD-11 cargo freighter to increase its cargo capacity to the fast growing China market. Air Canada plans to deploy the freighter three times weekly between Canada and Shanghai beginning May 2005, subject to government approval.

The addition of the MD-11 freighter to Air Canada's existing daily Shanghai service will triple available weight capacity on the route in response to customer demand, the airline said.

In addition, Air Canada is extending its lease agreement with Gemini Air Cargo to operate over the North Atlantic for an additional two years effective March 1. Through this lease agreement with Gemini, Air Canada said it now offers five times weekly all-cargo service between Toronto and Frankfurt, complementing its shared passenger operations to Europe.

Air Canada said it has also boosted its freight capacity within Canada. Air Canada provides its cargo customers with an additional 18 metric tons of upper deck capacity four days a week in the Toronto-Calgary-Vancouver market using leased Boeing 727 cargo aircraft.

Air Canada orders firm, Embraer says
Official denies rumours airline may switch to Bombardier
Canadian Press
19 March 2005

MONTREAL -- Air Canada could be under pressure to cancel a large airplane order with Brazil's Embraer SA and instead be the launch customer for a new aircraft proposed by Bombardier Aerospace, a Wall Street analyst said yesterday.

Heidi Wood of Morgan Stanley Dean Witter said there are rumours the Canadian government and other political parties are putting pressure on Air Canada to cancel an order with Embraer and back Bombardier's new C Series jet.

In a conference call with Embraer management, the analyst said the pressure is on because of the $700 million in financing aid Ottawa and the Quebec government are to grant Bombardier to get its new C Series aircraft off the ground and assure it will be assembled in Quebec.

Mauricio Botelho, chief executive of Bombardier's arch rival Embraer, said a cancellation is highly unlikely for the 90 aircraft - including options - ordered by Air Canada, with deliveries starting this year.

"I don't believe this is likely to happen," Botelho said in a conference call to discuss his company's fourth-quarter results.

Botelho noted that Embraer won the orders in 2003 and 2004 on the merits of its aircraft against bids from Bombardier, Airbus and Boeing. Bombardier also got orders for 90 aircraft.

"At that time there was strong pressure from the government and from political entities in Canada to back their local industry, but that did not happen because of the value of our airplane," said Botelho.

He added that deliveries for the two ordered models will start this year, whereas the Bombardier C Series - if it goes ahead - could not begin deliveries for another five years.

Air Canada spokeswoman Isabelle Arthur also said the rumours "are unfounded. We have no plans to cancel our Embraer aircraft order."

Eyebrows were raised when Air Canada split its regional jet orders between Bombardier and Embraer. The airline agreed in December 2003 to a deal for 45 Embraer 190s, seating 93 passengers, with options for another 45, for orders totalling $2.7 billion.

It followed up with an order in November 2004, for 15 Embraer 175s, seating 75 passengers, with an option for 15, for a combined value of $1 billion.

Air Canada thus became the launch customer for the Embraer 175 allowing the Brazilian manufacturer to go forward with that program.

Bombardier, with an aircraft assembly plant right next to Air Canada's head office, makes aircraft in both those classes.

This week Bombardier's board of directors approved an "authority to offer" for C Series, meaning the company can start looking for a launch customer for the 110- to 130-seat aircraft.

Air Canada warns of industry turbulence
21 March 2005
The Globe and Mail

ACE Aviation Holdings Inc., parent of Air Canada, says increased airline competition, high fuel prices and debt may hurt the company's profitability.

Air Canada emerged from 18 months of bankruptcy protection on Sept. 30, after cutting $12-billion in liabilities by more than half. Montreal-based ACE is matching airfares of rivals such as WestJet Airlines and introducing 90 regional jets to its fleet by 2008 to replace older, less fuel-efficient aircraft.

High fuel prices and increased competition from U.S. airlines and low-cost Canadian carriers may keep ACE from generating enough money, forcing it to “delay or abandon” its business plan, it said.

“A delay or failure in the completion of the corporation's fleet restructuring, including a delay in delivery of regional jets, could adversely affect the implementation of the new business plan, which may, in turn, have an adverse effect on the corporation's business results from operations and financial condition,” ACE said in a filing submitted to regulators late Friday.

ACE said it will continue to have “significant” debt, and its ability to pay depends on the airline's performance and a chance to refinance on more favourable terms.

In a statement issued yesterday, ACE said it continues to expect improved operating and financial performance this year as a result of its cost-reduction measures, and it is committed to achieving its 2005 earnings projection even though the price of oil has exceeded its estimated cost of $35 (U.S.) a barrel.

However, it added: “As fuel prices are subject to many external factors beyond the corporation's control, the corporation may not be able to fully mitigate the potential adverse effect that this or other factors could have on the 2005 EBITDAR projection.”

ACE Aviation Increasing Regional Jet Fleet In 2005
By Monica Gutschi
22 March 2005

TORONTO (Dow Jones)--ACE Aviation Holdings Inc. (ACE.B.T) is speeding up the delivery of two new regional jets from Embraer S.A. (ERJ), and is leasing eight used aircraft built by Bombardier Inc. (BBD.SV.B.T) for use by its regional subsidiary Jazz.

The aircraft are in addition to the planned expansion of regional jets at both Jazz and the mainline carrier Air Canada, a company spokeswoman said.

Air Canada was to receive 15 70-seat Embraer 175 series jets this year, and two 90-seat Embraer 190 series jets. According to recent company filings, the Embraer 190 series aircraft delivery schedule was modified. Two of the 18 jets that were to be delivered in 2006 will now be delivered this year.

Meanwhile, regional carrier Jazz was to receive seven Bombardier 50-seat CRJ200 aircraft and 15 70-seat CRJ705 aircraft in 2005. Filings show that in addition, ACE's board on March 8 approved another eight CRJ200s under operating leases.

Isabelle Arthur, a spokeswoman for Air Canada, said the company is finalizing the leases on the aircraft. No further details were available.

The aircraft are believed to have come from Independence Air, the operating subsidiary of Flyi Inc. (FLYI).

Air Canada parent ACE to issue equity, debt

MONTREAL, March 21 (Reuters) - Air Canada parent ACE Aviation Holdings Inc. plans to refinance an expensive loan from GE Capital by raising C$600 million ($496 million) in a combination of debt and equity, the company said on Monday.

ACE said it would offer about C$350 million in class A and B shares, and C$250 million in convertible notes.

Proceeds will repay C$540 million in a credit facility from General Electric (GE.N) unit GE Capital that was used to finance Air Canada's exit from 18 months of court protection from creditors at the end of September.

The repayment will cut ACE's net annual interest costs by about C$27 million, the company said.

Analysts had been expecting the refinancing, part of a process that some predict may lead to the spinoff of Air Canada's frequent flyer program Aeroplan.

Class B shares of ACE were off 10 Canadian cents at C$34.50 in Toronto on Monday morning.

ACE also said Air Canada had obtained commitments from a lending syndicate led by the Bank of Montreal (BMO.TO) for a C$300 million two-year revolving credit facility, subject to the completion of the equity offering.

After it issues the equity and repays the GE Capital loan, ACE will have cash and committed credit facilities of C$2 billion. Its net debt will be about C$4 billion, it said.

On Sunday, ACE reiterated its forecast for C$1.6 billion of earnings before interest, taxes, depreciation, amortization and aircraft rent for 2005.

That assumes average price of $35 a barrel for West Texas Intermediate crude oil in 2005, but ACE said it expects higher revenues and additional cost savings to offset the spike in fuel prices.

U.S. light crude oil prices have been hovering just under the record price of $57.60 a barrel hit on Thursday.

($1=$1.21 Canadian)
(Additional reporting by Sue Thomas in Toronto).

3,000 line up for airline jobs
Air Canada hiring flight attendants for summer Former Jetsgo employees go to head of the line
Daphne Gordon
Toronto Star
21 March 2005

Kaely Hebert hopes to be airborne again soon, after her recent bumpy landing with defunct airline Jetsgo.

Hebert stood in line at the Holiday Inn on King St. W. yesterday, where Air Canada was accepting resumes for jobs for flight attendants based at Pearson International Airport.

"It's still a good job if you can get it," said the 20-year-old, nine days after finding out in a newspaper she had lost her job as a flight attendant with Jetsgo.

About 3,000 people attended the fair over the weekend, lining up for several hours in some cases, just to get a 15-minute informal interview with Air Canada recruiters.

The airline is recruiting flight attendants to add to its staff for the summer season, said airline spokesperson Laura Cooke yesterday.

She explained that successful applicants will win short-term contracts based out of Toronto Pearson airport.

Cooke couldn't say exactly how many jobs are available.

Applicant Barbara D'Amico, who has been doing office work for the last few years but hopes to become a flight attendant, said, "It's a very exciting career."

"They're willing to train, and although I don't have experience in the field, I have other skills that will go toward this."

The company was inviting former Jetsgo employees to pass the long line, which snaked through the second floor of the hotel.

"It makes sense for us to give priority to people with previous flying experience," said Cooke, adding that former Jetsgo employees will go through the same screening process as everyone else, including a formal interview, language testing and a rigorous training program.

While Air Canada officials were expecting many of the 1,350 people who lost their jobs at Jetsgo to attend the fair, only about 50 applicants acknowledged that they had been working at the discount airline.

"We did expect more, but we weren't really in a position to predict," said Cooke.

A few hundred candidates from last weekend's recruitment sessions will be invited back for a more formal interview, said Cooke.

"I got a ticket to ride!" declared one 25-year-old woman who emerged with an invitation to return at a later date. She asked not to be named but described the screening process as well-organized and professional.

Air Canada Technical Services Secures USD$300 Million Maintenance Agreement for Delta Air Lines

MONTREAL, March 29 /CNW Telbec/ - Air Canada Technical Services (ACTS), a limited partnership of ACE Aviation Holdings Inc., today announced that it has secured an agreement with Delta Air Lines for the maintenance, repair and
overhaul (MRO) of the Atlanta-based airline's fleet of more than 200 Boeing 757-200, 767-300 and 767-300ER aircraft. The exclusive agreement, one of the industry's largest outsourcing contracts, covers a period of five years and represents potential revenue to ACTS of approximately USD$300 million. Heavy maintenance work will be performed at ACTS's Vancouver maintenance centre beginning in May 2005, resulting in the creation of approximately 300 jobs there. Delta Air Lines currently operates 121 Boeing 757s, 28 Boeing 767-300s and 59 Boeing 767-300ER aircraft.

"The selection of ACTS to perform Delta's heavy maintenance work on its Boeing fleet is a reflection of Air Canada Technical Services' worldwide reputation for safety and reliability, and underscores our cost competitiveness achieved through restructuring last year," said Robert Milton, Chairman of ACTS, and Chairman, President and CEO of ACE Aviation Holdings Inc. "We look forward to further developing the potential value that ACTS holds for all stakeholders, including customers such as Delta, one of the world's leading and largest carriers."

"A major contract such as this, one of the industry's largest, reflects ACTS's strong reputation for quality service and technical expertise in a number of fleet types including these Boeing aircraft," said Bill Zoeller, President and CEO, ACTS. "Our agreement with Delta Air Lines is consistent with our business strategy to leverage our MRO expertise, and knowledge of commercial airline operations, to grow as a stand alone profitable business."

Air Canada Technical Services, a limited partnership of ACE Aviation Holdings Inc., the parent company of Air Canada, is a full-service Maintenance, Repair and Overhaul organization that provides airframe, engine and component maintenance and various ancillary services to a wide range of more than 100 global customers, including Air Canada, Air Canada Jazz, JetBlue, United Airlines, ABX, Mexicana, Snecma Services, Chromalloy, Lufthansa Technik, International Lease Finance Corporation (ILFC) and Canada's Department of National Defence. Montreal-based ACTS operates maintenance centers across Canada with a combined workforce of 3,600 employees and has major bases in Montreal, Toronto, Winnipeg and Vancouver.

ACE Aviation Announces Pricing Of C$720M Concurrent Equity And Convertible Senior Notes Offerings
30 March 2005

MONTREAL (Dow Jones)--Strong investor demand has resulted in ACE Aviation Holdings Inc. (ACE.B.T) increasing the size of its concurrent equity and convertible senior note offers to now raise a total of about C$720 million, up from the originally planned C$600 million.

In a news release, ACE Aviation said it will sell a total of 11,350,000 Class A variable voting shares and Class B voting shares at C$37 each, for gross proceeds of about C$420 million, as well as C$300 million of 4.25% convertible senior notes due 2035.

The company said it has granted the underwriters over-allotment options to purchase up to another 10% of each of the offerings for 30 days after closing. If both options are exercised in full, the total size of the combined offerings will be C$792 million.

The financings, which are subject to regulatory approvals, are expected to close on about April 6.

ACE Aviation said the senior notes will be convertible into shares at an initial conversion price of C$48 a share, which represents a premium of about 30% to the share offering price and a ratio of about 20.8333 shares per C$1,000 principal amount of notes. The senior notes will be convertible any time at the option of the holders.

Starting June 6, 2008, ACE Aviation said it will have the right to redeem all or a portion of the convertible senior notes. Holders may require ACE to purchase all or a portion of their convertible senior notes, at a price equal to 100% of the principal amount of the notes plus accrued interest, on June 1 of the years 2010, 2015, 2020, 2025 and 2030.

As reported, ACE Aviation's principal subsidiary, Air Canada, received commitments from a syndicate of lenders for a two year senior secured revolving credit facility totaling C$300 million, subject to completion of the equity offering.

ACE Aviation said net proceeds from the offerings will be used mainly to repay outstanding debt of C$540 million under an exit credit facility with General Electric Capital Corp. The repayment will reduce net annual interest costs by about C$27 million, it said, and will provide it with greater strategic and financial flexibility.

As of March 28, ACE Aviation said its consolidated cash balance, measured on the basis of cash in bank accounts, totaled about C$1.8 billion. After after giving effect to the offering, the syndicated credit facility and the repayment of the exit facility, it said it will have cash and committed credit facilities of more than C$2 billion, resulting in adjusted net debt of about C$4 billion.

RBC Capital Markets, BMO Nesbitt Burns and CIBC World Markets are acting as joint book running managers for the equity offering. RBC Capital Markets, Merrill Lynch and BMO Nesbitt Burns are acting as joint bookrunning managers for the convertible senior note offering.

The shares and convertible senior notes being offered won't be registered under the U.S. Securities Act of 1933, the company noted.

ACE Aviation is the parent holding company of Air Canada and certain other subsidiaries including Aeroplan LP, Jazz Air LP and ACTS LP. According to the TSX Web Site, ACE Aviation had 11.5 million Class B shares outstanding as of Tuesday's close.

Hungry investors boost ACE's offering plans
Equity, debt issue rising 20 per cent
Airline aims to pay off costly loan
31 March 2005
The Toronto Star

MONTREAL -- Air Canada parent ACE Aviation Holdings Inc. plans to boost its equity and debt offering 20 per cent to $720 million because of strong investor demand.

ACE will offer 11.35 million class A and B shares at $37 each, for a total value of $420 million, the Montreal-based company said yesterday.

ACE is also offering $300 million in 4.25 per cent convertible senior notes due in 2035.

The notes will be convertible into stock at $48 a share.

Over-allotment options could push the value of the equity and debt offer to $792 million.

Last week, ACE unveiled plans to refinance an expensive loan from General Electric Co. unit General Electric Capital Co. by raising $600 million.

The refinancing would cut annual interest costs by $27 million.

Yesterday, ACE said strong investor demand has prompted the company to increase the offering.

Robert Milton, chairman, president and chief executive at ACE, said ticket bookings are strong at Canada's largest airline, which emerged from 18 months of court protection from creditors at the end of September.

ACE said its cash balance of $1.8 billion will rise to more than $2 billion after the offering and refinancing.

Adjusted net debt, which includes the capitalized value of aircraft leases, will amount to some $4 billion.

Analysts had been expecting the refinancing, which is part of a process that some predict may lead to the spin-off of Air Canada's frequent-flyer program, Aeroplan.

ACE's class B shares rose $1.10, or 2.98 per cent, to close at $38 on the Toronto Stock Exchange yesterday.

The stock hit a year high of $38.83 on March 14.

The offering is expected to close on April 6.

Air Canada Says Delta Contract Worth $300 Million



Tuesday, March 29, 2005 10:06:51 AM ET

MONTREAL (Reuters) - Air Canada's new contract to maintain parts of the Delta Air Lines aircraft fleet is worth $300 million over 5 years, the airline said on Tuesday.

Air Canada's parent ACE Aviation Holdings Inc. said its Technical Services limited partnership, will conduct heavy maintenance, repair and overhaul work on the Delta fleet at its Vancouver center, beginning in May. The contract will create about 300 jobs.

Air Canada Offers More Aeroplan Miles for Faster Reward Travel, Gives Simplified Fares More Simplified Names

MONTREAL, April 1 /CNW Telbec/ - Starting today, eligible Air Canada
customers will earn more Aeroplan Miles - for purchasing online at
aircanada.com, and again while traveling - to make it faster than ever to
receive reward travel on Air Canada and its Star Alliance partner airlines. In
addition to enhanced Aeroplan benefits, the carrier also announced changes to its simplified fare structure that will make it easier for consumers to choose
the bundle of benefits right for them among the carrier's five simplified fare
products for travel in Canada and the United States.

"Shoppers are used to buying options on cars, software upgrades and the
right hotel accommodation that meets their needs and budget. Air Canada has
done the same by offering clear choices for air travellers, and now we've made
it even more rewarding as well as simpler for consumers to make informed
choices," said Montie Brewer, President and Chief Executive Officer. "After
having simplified fares, eliminated old-style ticketing restrictions and
introduced exclusively one-way options for maximum travel flexibility, today
we've gone one step further by offering our customers even more rewards for
choosing to purchase online at aircanada.com."

In addition, to make each fare product more easily recognizable for its
unique value-added benefits, Air Canada has renamed two of its five fare
products:

- Tango remains Air Canada's popular everyday low, no-frills fare.
- Tango Plus replaces Fun, leveraging the Tango brand's wide recognition for affordability, while clearly indicating additional value-added customer benefits such as complimentary advance seat selection and lower change fees. In addition, Aeroplan members will now receive more Miles for their purchase online at aircanada.com, plus more Status Miles while traveling that count towards earning top tier status.
- Latitude remains the fare product offering maximum travel flexibility with complimentary unlimited changes any time, eligibility for upgrades to Executive Class, and now more Miles for purchasing online at aircanada.com .
- Latitude Plus replaces Freedom, offering maximum flexibility with additional perks such as lounge access and priority check-in and baggage handling, eligibility for upgrades to Executive Class, and now more Miles for purchasing online at aircanada.com.
- Executive Class remains Canada's choice for premium comfort and service, and now offers more Miles for purchasing online at aircanada.com.

With over 200,000 visits per day and accounting for more than 50 per cent
of Air Canada's domestic sales, aircanada.com is Canada's favourite source for
affordable, value-driven fares on an everyday basis.

Air Canada has made it easier than ever to find the greatest choice of
competitive low fares online. With the recent introduction of a powerful new
booking engine at aircanada.com, consumers and travel agents can see at a
glance the lowest fares available over a period of several days before and
after their selected travel date. The new fare search tool, a first for a
Canadian air carrier, uses leading edge technology to display up to seven days
of fares at a time with a single click of a mouse, compared to older
technologies used by other carriers that require more time and effort to
repeat the search process for each travel date selected.

Visiting aircanada.com is more than choosing the right fare product to
meet each traveller's own needs. Air Canada recently expanded its popular
online check-in service to include all of its flights departing Canada, in
addition to its domestic flights. Air Canada customers departing Canada to any
destination in the United States or overseas can now check-in and print
boarding passes from the convenience of their home or office by simply
visiting aircanada.com . Web check-in is available within 12 hours before a
flight, and up to one hour before domestic Canada flight departures or two
hours before U.S. and international flight departures, to give enough time for
customers to arrive at the airport. The availability of this convenient
service will be further expanded in the near future to include international
flights bound for Canada.

Air Canada was the first full-service carrier in North America to
simplify fares, offering five one-way fare products to choose from, and now
more Aeroplan Miles to obtain faster reward travel:

Tango: Air Canada's everyday low, no-frills fare
- $150 flat fee for same-day changes at the airport, with no additional charges for fare difference
- Unlimited changes anytime for $30 plus additional fare difference
- 50% Aeroplan Miles (non Status Miles)
- One Aeroplan Mile for every $3 spent when booking online
- Advance seat selection for $15
- Non-refundable

Tango Plus: Tango affordability, plus -
- Just $50 for same-day changes at the airport, with no additional charges for fare difference
- Complimentary advance seat selection
- More Aeroplan Miles: 100% Aeroplan Status Miles (was 50%)
- One Aeroplan Mile for every $2 spent when booking online (was for every $3 spent)

Latitude: Maximum flexibility
- Complimentary unlimited changes any time
- Fully refundable
- 100% Aeroplan Status Miles
- One Aeroplan Mile for every $1 spent when booking online (was for every $3 spent)
- Complimentary advance seat selection
- Eligible for Aeroplan upgrade to Executive Class

Latitude Plus: All the benefits of Latitude, plus -
- Complimentary access to Maple Leaf Lounges (in Canada)
- Priority check-in and priority baggage handling (in Canada)
- 125% Aeroplan Status Miles
- One Aeroplan Mile for every $1 spent when booking online (was for every $3 spent)

Executive Class: Premium comfort and service
- Seating in Executive Class cabin
- Complimentary access to Maple Leaf Lounges
- Complimentary unlimited changes any time
- Priority check-in, priority baggage handling and priority boarding
- Fully refundable
- Complimentary advance seat selection
- 150% Aeroplan Status Miles for J class bookings; 125% Aeroplan Status Miles for C class bookings
- One Aeroplan Mile for every 1$ spent when booking online (was for every $3 spent)

Air Canada launches Toronto-Rome service
5 April 2005
Airline Industry Information

Air Canada has launched a new year-round direct service between Toronto's Pearson International Airport, Canada and Rome, Italy.

From 12 April 2005 Air Canada will reportedly also offer codeshare flights via Rome to Lamezia Terme, Catania, Palermo, Turin and Venice in cooperation with Air One, a Lufthansa partner airline.

According to the airline, the Toronto-Rome service will be operated with Boeing 767-300ER aircraft.

Air Canada Inaugurates Non-Stop Service to Rome, Introduces Codeshare Services Within Italy

MONTREAL, April 5 /CNW Telbec/ - With the departure today of flight AC890
en route to Rome from Toronto's Pearson International Airport, Air Canada
inaugurates year-round non-stop flights between Canada and Italy's capital
city. In addition, effective April 12, 2005, Air Canada will offer flights on
a codeshare basis via Rome to Lamezia Terme, Catania, Palermo, Turin and
Venice in cooperation with Air One, a Lufthansa partner airline. The codeshare
agreement with Air One features reciprocal frequent flyer benefits for
Aeroplan members.
"The reintroduction of our non-stop service to Rome strengthens Air
Canada's position as the carrier of choice for non-stop flights to Europe,"
said Ben Smith, Vice President, Planning. "Together with our codeshare
partner, Air One, Air Canada's network is extended further to points
throughout Italy resulting in a more seamless travel experience for our
customers."
Air Canada's Toronto-Rome non-stop service is operated using 223-seat
Boeing 767-300 ER aircraft, offering customers a choice of two classes of
service. Flights are timed for convenient connections to and from cities
throughout Air Canada's extensive North American network.

Toronto Rome Rome Toronto
AC890 1825 0900 (+1) AC891 1220 1610


Montréal-based Air Canada provides scheduled and charter air
transportation for passengers and cargo to more than 150 destinations on five
continents. Canada's flag carrier is the 14th largest commercial airline in
the world and serves 30 million customers annually with a fleet consisting of
300 aircraft. Air Canada has been ranked as the world's safest airline and in
a 2002 survey of the world's most frequent air travellers by travel
information publisher OAG, Air Canada was voted best airline in North America
for the second time in three years, and Air Canada's frequent flyer program,
Aeroplan, was voted best in the world. Air Canada is a founding member of Star
Alliance providing the world's most comprehensive air transportation network.

Air Canada March Load Factor 79.8%
06 April 2005

MONTREAL (Dow Jones)--Air Canada flew 3.62 billion revenue passenger miles in March, up 6.4% from a year earlier.

In a press release, the company said capacity was up 1.7% to 4.53 billion available seat miles and the load factor increased to 79.8% from 76.3%.

For the first three months of the year, traffic was up 4.8% to 10.11 billion revenue passenger miles, capacity was down 1.6% to 12.88 billion available seat miles and the load factor rose to 78.5% from 73.7%.

For its Jazz regional division in March, traffic was up 11.8% to 161 million revenue passenger miles, capacity was down 3% to 226 million available seat miles and the load factor improved to 71.2% from 61.8%.

Air Canada is owned by ACE Aviation Holdings Inc. (ACE.B.T).

Air Canada to resume flights to Guyana
7 April 2005

GEORGETOWN, Guyana (AP) - Air Canada will resume scheduled flights to Guyana this summer after a break of about three decades, the government said Thursday.

The three weekly fights to Guyana from Canada via Trinidad are set to begin June 13, said Manniram Prashad, an adviser to President Bharrat Jagdeo.

Air Canada, along with British Airways (then BOAC), Pan Am, Air France and several other airlines, had pulled out of the South American country in the late 1970s during the height of an economic downturn that made it difficult to repatriate international currencies to their home bases.

None of the others have returned but the government has said it is also courting American Airlines to add the former British colony of more than 700,000 people to its routes either from Trinidad or Barbados.

Air Canada, based in Montreal, plans to use either an Airbus-319 or a Boeing 767 depending on passenger load, officials said.

Workers win in airline's battle to close 9 bases
Rick Westhead
Toronto Star
08 April 2005

The union representing Air Canada's reservation agents has won a battle with the airline over its plans to close nine bases in cities such as Whitehorse and Thunder Bay, a move that would have forced as many as 330 employees to choose between moving to the carrier's larger offices or severing ties completely.

In a ruling issued this week, Martin Teplitsky, Air Canada's chief arbitrator, has ruled that Air Canada employees represented by the Canadian Auto Workers have the right to remain in affected cities to work for Air Canada's regional Jazz unit at their current rate of pay.

The 110 affected employees will also receive their current benefits and pension entitlements, Teplitsky ruled.

In a memo to members, CAW officials described the judge's decision as a "double win" since "present employees are not to be harmed and the future looks better as these bases will be able to compete on an improved cost structure."

Air Canada spokesperson Laura Cooke said the company "understands that the delay in dealing with this process was unsettling for employees."

The CAW and the International Association of Machinists and Aerospace Workers, which represents ramp workers and baggage handlers, both filed grievances over the carrier's plans.

Air Canada, WestJet Fly Fuller Planes in March
Wed April 6, 2005 10:25 AM GMT-04:00

TORONTO (Reuters) - WestJet Airlines Ltd. and Air Canada both flew fuller planes in March than a year earlier, the two airlines said on Wednesday.

Montreal-based Air Canada, the operating arm of ACE Aviation Holdings Inc. , said its March traffic, measured by revenue passenger miles, rose 6.4 percent from a year earlier, while overall capacity increased by 1.7 percent.

Its passenger load factor, which gauges the number of seats sold as a proportion of available seats, rose 3.5 percentage points, to 79.8 percent, from 76.3 percent in March 2004.

Domestically, traffic increased by 3.3 percent, while capacity decreased by 1.1 percent. The load factor rose 3.4 percentage points, to 79 percent from 75.6 percent a year ago.

Air Canada, the country's major carrier, said March was the 12th straight record month for its load factor.

Number 2 carrier WestJet, Canada's leading discount airline, said its traffic for March 2005 rose 54.7 percent from a year ago, while overall capacity rose 34.7 percent.

Its load factor was up 10.1 percentage points at 77.8 percent. This compares with 67.7 percent last March.

Both airlines have benefited from the demise of discount competitor Jetsgo in early March.

Aeroplan rapped over data security
11 April 2005
The Globe and Mail

The Office of the Privacy Commissioner has sharply criticized security at Air Canada's popular Aeroplan frequent-flyer program and told the airline to better protect members' account information.

“On the whole, there was a clear lack of diligence on the part of Air Canada with respect to its handling and protection of customer personal information,” Heather Black, assistant privacy commissioner, said in a recent ruling involving a Vancouver businessman whose Aeroplan account was accessed, and changed, by his former boss.

While noting the airline has taken some steps to tighten security, she said key data is still too easily available. “If someone with access to an account number calls the system, he or she [is able to access] the account holder's name, the number of miles recently credited to the account, and the account balance.”

“This information is not password protected. I remain concerned about the accessibility to the information that is still on the system.”

Aeroplan has six million members and has reward program partnerships with retailers such as Future Shop Ltd., Imperial Oil Ltd.'s Esso gasoline chain and Bell Canada's phone services.

Michele Meier, an Aeroplan spokeswoman, said the company has already acted on recommendations made during the investigation, “We're in the process of evaluating whether any further measures will be taken or will be necessary,” she said.

The case dates back to March 14, 2002, when the businessman, Danny Yehia, received a duplicate copy of his previous Aeroplan statement.

When he contacted Aeroplan for an explanation of why he was sent the additional statement, he was told that someone had requested the information and changed the e-mail address on his account.

At the time, Mr. Yehia was involved in a lawsuit with his former boss, Joel Berman, a Vancouver glass designer. Mr. Berman alleged Mr. Yehia and his partner had taken company secrets when they left his glass business months earlier. Part of the lawsuit centred around a trip Mr. Yehia took to Australia allegedly to meet a rival glass company.

Mr. Berman admitted to the privacy officer that he obtained detailed information about Mr. Yehia's account from Aeroplan's computerized telephone information system and through an Air Canada agent. “Air Canada states that he could do this because there was no personal identification number required,” Ms. Black said in her decision.

She said Mr. Berman did not misrepresent himself or pretend to be Mr. Yehia. In fact, he provided the agent with his name in order to pay a processing fee to change the account.

The lawsuit was eventually dropped, but Mr. Yehia complained about Aeroplan's actions to the privacy commissioner.

In her decision, released last week, Ms. Black said she was “disturbed by Air Canada's lack of co-operation with respect to [Mr. Yehia's] complaint.”

She also said the agent who changed the account had not been properly trained in privacy issues and “it did not appear to concern her that she was not speaking to the account holder.” The agent “did not even seem to be aware of the importance of maintaining the confidentiality of personal information.”

She added that, given the number of people who have access to Aeroplan members' numbers, such as employers, travel agents, and Aeroplan workers, “I do not believe that having account information readily available, without any protection on it, constituted an adequate safeguard.”

Ms. Meier said Aeroplan regrets “this unfortunate incident,” and noted that it has restricted the information on the automated phone service. It has also updated privacy procedures and introduced more training for staff.

But Ms. Black questioned whether the changes go far enough. She said the automated system still provides access to account holders' names, the number of miles recently credited to the account and the account balance.

“Many individuals have credit cards that are partnered with Aeroplan. Anyone with access to the Aeroplan account number could potentially know from the number of miles credited to the account how much money was charged against the account holders' credit card in a month.”

She recommended password controls should be placed on all account information that is accessible though the automated system.

Mr. Yehia said Aeroplan should be doing much more to protect information.

“You'd think that after [the Sept. 11, 2001 terrorist attacks] security would be an important issue,” he said.

When asked if he is still an Aeroplan member, he laughed and replied: “I am. Because where I travel, I don't really have much choice.”

Air Canada Welcomes New Canada-China Bilateral Air Agreement; Announces Major Expansion of Passenger and Cargo Services to China

MONTREAL, April 19 /CNW Telbec/ - Air Canada welcomed major enhancements
announced today in the Canada-China bilateral air services agreement and
applauded the federal government for achieving a framework that will allow for
significant growth in passenger and freight transportation in this important
market. The new bilateral air agreement will allow for a threefold increase in
capacity as well as the addition of more points in China that can be served
directly.
With the unveiling of a new bilateral air agreement, Air Canada today
announced extensive plans for expansion of its passenger and freight services
to China, one of the world's largest and fastest growing economies. Plans for
new passenger and shared cargo services include:

- New Toronto-Beijing non-stop service to be increased to daily flights
by 2006;
- Daily Toronto-Shanghai non-stop service to begin summer 2006;
- Daily Vancouver-Guangzhou non-stop service to begin summer 2007.

Air Canada is also introducing next month cargo operations between
Toronto and Shanghai using an MD-11 freighter with a total cargo capacity of
85 tonnes. This cargo service will be increased to daily flights in 2006.
In addition, Air Canada plans to expand its dedicated cargo operations to
China as follows:

- Second daily Toronto-Shanghai freighter service via Vancouver to begin
2006;
- Daily Toronto-Guangzhou freighter service to begin 2007.
- Future plans also include freighter service to Tianjin to serve
Northern China.

"This new bilateral air agreement will allow Canada and China to realize
tremendous opportunities for growth in air transportation for passengers and
freight. We applaud Canada's Minister of Transport, Jean Lapierre, and
officials of both governments for achieving a new framework that will allow
for strategic growth and positive change in this critically important market,"
said Montie Brewer, President and Chief Executive Officer. "With Air Canada's
introduction of double daily services via our main hub in Toronto to Shanghai
and Beijing, together with our daily non-stop service to Hong Kong, we will
provide eastern North America and Latin America with unprecedented ease of
access to mainland China and Hong Kong. Moreover, now that Canada will be
granted Approved Destination Status, Air Canada is well positioned to meet the
significant growth that is expected in tourism between China and Canada in the
years to come."
On January 21, 2005, the People's Republic of China agreed to recognize
Canada as an officially approved travel destination. Approved Destination
Status (ADS) will allow Chinese residents to travel to Canada using a tourist
exit visa. Currently, only a limited number of Chinese visitors travelling on
business can obtain exit visas to Canada. In 2004, Canada received 77 000
overnight visitors from China, and the World Tourism Organization estimates
that by 2020, there will be 100 million Chinese tourists annually.
"The new bilateral air agreement is also excellent news for freight
forwarders seeking ways to seize new opportunities for trade with China, one
of the world's fastest growing economies that will now be better served than
ever by Air Canada's cargo services. We are very excited with the prospect of
expanding dedicated freighter services to Shanghai and Guangzhou from our main
Toronto hub to meet double digit growth in demand from freight forwarders,"
concluded Brewer.
Air Canada's expanded China services from its main Toronto hub will offer
passengers and freight forwarders convenient connections for flights
throughout the carrier's extensive network in North and South America, and
complement its daily non-stop services from Vancouver to Beijing and Shanghai,
as well as its daily non-stop flights to Hong Kong from Toronto and Vancouver.
"Toronto is a natural gateway to Asia," said Toronto Mayor David Miller.
"Thousands of Torontonians have business, cultural and family ties with China.
This non-stop service uniquely positions Toronto as a major conduit between
China and North and South America, which is great news for our international
trade and tourism industries."
With an elapsed time of 13 hours 20 minutes westbound and 13 hours
eastbound, Air Canada's new Toronto-Beijing service will save travellers more
than three and a half hours in each direction compared to the Vancouver
routing. Air Canada will operate the new route using 282-seat A340-300
aircraft.
In response to increased demand on its Vancouver-Shanghai route, during
the peak demand season beginning June 1, 2005 Air Canada will replace its
189-seat Boeing 767-300ER service with larger 282-seat A340-300 aircraft.
From its main hub in Toronto, Air Canada currently operates non-stop
flights to Hong Kong, Tokyo, Seoul and Delhi, offering convenient connections
to and from points throughout the Americas. From its Asia Pacific gateway in
Vancouver, Air Canada serves Hong Kong, Shanghai, Beijing, Tokyo, Osaka,
Nagoya and Seoul with daily non-stop flights. With the introduction of daily
non-stop service to Guangzhou in 2007, Air Canada will serve more points with
greater frequency in China than any other North American carrier.

Montréal-based Air Canada provides scheduled and charter air
transportation for passengers and cargo to more than 150 destinations on five
continents. Canada's flag carrier is the 14th largest commercial airline in
the world and serves more than 29 million customers annually. Air Canada is a
founding member of Star Alliance providing the world's most comprehensive air
transportation network.

Air Canada eyes two daily flights to China
By Roger Bray
Published: April 21 2005 03:00 | Last updated: April 21 2005 03:00

Air Canada has announced plans to launch two new daily, non-stop services to China. Starting next summer it will fly from Toronto to Shanghai. And in summer 2007, it will begin operating from Vancouver to Guangzhou.

The move follows the negotiation of a new bilateral air agreement by the Canadian and the Chinese governments.

ENGLEWOOD, Colo., April 20 /CNW/ -- After an intense competition
with two European-based organizations, Jeppesen has won the chart and
electronic aeronautical data business for both Air Canada and its regional
airline subsidiary, Air Canada Jazz. In the end, Jeppesen came out on top
because of its solid vision, technical leadership and its ability to deliver
Electronic Flight Bag (EFB) applications while also providing comprehensive
worldwide, traditional paper-based services. "We are very pleased to be
entering into this partnership with Jeppesen as we move toward a full digital
transformation of our routing charts, and we look forward to many years of
working together," said Rob Reid, senior vice president-operations, Air
Canada. "We needed a partner that could deliver paper charts while laying out
a clear strategy for EFB deployment, and Jeppesen was able to deliver and meet
all of our requirements."
A full digital transformation is the goal at Air Canada. To support this
effort, Jeppesen will supply paper- and electronic-based flight critical data
to both carriers in a series of three phases. Phase one will immediately
transition Air Canada's operation into Jeppesen's traditional paper-based
Airway Manual, trusted for over 70 years by airlines around the globe. The
second phase will involve the deployment of Jeppesen's ground-based electronic
chart delivery system, e-Link, allowing Air Canada and Air Canada Jazz to view
and print their tailored navigation chart library via a secure Internet
connection. Phase three will set the stage for a paper to electronic
transformation at Air Canada. Both companies will work closely together to
make the EFB an operational reality, and thus create a pathway for the airline
to realize a fully paperless and streamlined flow of navigation data.
"The Air Canada contract is a win for both companies, and we are very
pleased to have been given the chance to prove what we can do," said Mark Van
Tine, Jeppesen president and COO. "The business environment for Jeppesen is
becoming ever more competitive, and our European-based competitors were
clearly aiming for Air Canada in order to establish a North American presence.
Jeppesen's win sends a clear message to the marketplace and further reinforces
that we are the worldwide leader in aeronautical data management. We have the
technology and expertise to help our customers make the transition into the
next generation of electronic aeronautical data management."

About Air Canada
Air Canada, together with its regional airline subsidiary Air Canada Jazz,
provides scheduled and charter air transportation for passengers and cargo to
more than 150 destinations, vacation packages to over 90 destinations, as well
as maintenance, ground handling and training services to other airlines. Its
fleet consists of 293 aircraft.
Air Canada Jazz is a subsidiary and serves approximately
six million customers per year and averages 724 flights per day.

About Jeppesen
Jeppesen is recognized as the world's foremost provider of integrated
aviation information solutions. Jeppesen's portfolio of products and services
includes: flight information, flight operations services, international trip
planning services, domestic and international fuel programs, aviation weather
services and aviation training systems. The Jeppesen group of companies has
offices in the United States, the United Kingdom, Germany, Australia, China
and Russia. Jeppesen is a subsidiary of Boeing Commercial Aviation Services,
a unit of Boeing Commercial Airplanes.

Monday April 25, 7:35 PM
Air Canada Orders Boeing 777, 787 Craft

AP - ACE Aviation Holdings Inc., the parent company of Air Canada, said Monday it plans to purchase 18 Boeing 777 aircraft and 14 Boeing 787 Dreamliners as part of a wide-body fleet renewal plan. Terms were not announced.

Montreal-based Air Canada made a firm order for the 32 jets, and also has the option to purchase 18 additional 777s and 46 more Dreamliners from Boeing Co.

Air Canada's 777 deliveries are scheduled to begin next year with the arrival of three 777-300ERs in 2006. The carrier's first 777-300ERs will operate its Vancouver-Tokyo service. Air Canada's first 787 is scheduled for delivery in 2010.

Robert Milton, chairman, president and CEO of ACE Aviation Holdings, said, "We have estimated the fuel burn and maintenance cost savings alone on the 787 to be about 30 percent versus the 767s they will replace. Particularly important in the current high fuel price environment is that the savings on these two line items alone will be more than twice the incremental ownership costs in acquiring these aircraft."

The airline said it is planning to dispose of more than 60 wide-bodies over the next 10 years, with the age of the Boeing 767s to be replaced averaging about 22 years.

Air Canada to spin off Aeroplan, Milton confirms
Nicolas Van Praet, with files from Chris Sorensen
19 April 2005
National Post

MONTREAL - Air Canada's holding company has fast-tracked the sale of its Aeroplan LP customer loyalty program and will bring it to market shortly in what is expected to be the first of several spinoffs of Air Canada businesses.

Robert Milton, chief executive of ACE Aviation Holdings Inc., said yesterday for the first time what the Canadian and U.S. investment communities have believed for months: that the company would spin off Aeroplan, in whole or in part, in an offering on public markets.

Mr. Milton did not close the door to selling part of Aeroplan to a private buyer. But he said buyout firm Onex Corp. is not in the picture as a potential purchaser. Onex had a deal with Air Canada to buy a 35% stake in Aeroplan for $245-million before that fell apart with the airline's bankruptcy protection filing. The company said recently that it was still interested in the unit. But Mr. Milton said the price could now be too rich for Onex. "Valuations have moved up appreciably, clearly we think it [Aeroplan] is in a position to go to the public markets," Mr. Milton said after a speech to a business audience in Montreal. "We remain on a fast track with the view that there is validity to the argument that it should be monetized, at least in part," he said. "It all seems to be coming together."

Mr. Milton offered no specific timing for the sale. He said the company is working on legal and regulatory issues to ready its public debut.

Analysts have pegged the unit's worth in the range of $1.3-billion to $1.9-billion and say Air Canada is likely preparing an income trust structure for Aeroplan.

Mr. Milton said when ACE officials met with investors and bankers in New York, Boston, Toronto and Montreal recently to work on raising $792-million in new equity, there was significant interest in an Aeroplan offer.

But one industry insider threw a wrench into that hype yesterday. He said buying into an income trust means buying cash flow forever, something that could be problematic given that Aeroplan's fortunes are at least partly tied to the fortunes of Air Canada. And while passenger traffic is rebounding now, that could change with an unforeseen event. In addition, the airline is also under threat from low-cost carriers on many routes.

"What if I am concerned about is the viability of those cash flows five to 10 years from now," the source said.

"The reality is the sophisticated investor has to think about that -- is this airline, in its current form, viable? Aeroplan survived this (last) restructuring. The next restructuring may not be as attractive."

One Bay Street analyst, who did not want his name used, said the divestiture of Aeroplan is the first step toward spinning off several of ACE's subsidiaries.

"It was always obvious that Aeroplan was going to be the first to go," the analyst said. Air Canada Technical Service, its jet maintenance unit; Jazz, its regional airline; and Air Canada Vacations, its tour package business, are next in line.

The analyst added that, in addition to creating value for ACE shareholders, the move to spin off subsidiaries should improve the fortunes of each unit. That is particularly the case with Aeroplan, which has long since moved away from its roots as a frequent-flyer program.

To date, Aeroplan, with six million members, has signed deals with companies including electronics retailer Future Shop, Esso service stations and Bell Canada, and plans to sign on as many as a dozen by the end of 2005.

"It's the most attractive of the assets to investors," because it is the subsidiary that has carved out its own business to the greatest extent, said Karl Moore, a business professor at McGill University in Montreal.

ACE shares, which started trading at $20 following Air Canada's exit from bankruptcy protection in September, closed down 75 cents at $35.25 yesterday.

Jets contract gives Boeing edge on Airbus
While Dreamliner is getting rave reviews, competitor's A350 is proving a tough sell
BERTRAND MAROTTE
26 April 2005
The Globe and Mail

The decision by Air Canada's parent company to order 32 new wide-body jets from Boeing Co. is a major boost to the venerable U.S. airplane manufacturer in its hard-fought campaign to wrest back leadership of the global commercial aircraft industry from rival Airbus SAS.

Boeing's sleek new fuel-efficient, long-range 787 has been garnering rave reviews, particularly from European airlines, while Airbus's A350 — an upgraded version of its 250-seat A330 — is proving so far to be a difficult sell.

So far, Boeing has booked 217 firm orders for the 787 — dubbed the Dreamliner — while the A350 is hoping to have 50 orders announced by the time the Paris air show rolls around this summer.

The ACE Aviation Holdings Inc. order for Air Canada — for 18 Boeing 777s and 14 787s — is a significant vote of confidence for the 787 from a North American carrier.

“Boeing appears to be making a major technological jump over Airbus,” said Robert Fay, a financial analyst with Canaccord Capital Corp.

A big advantage of the Boeing 787 is that it is not a derivative, unlike Airbus's A350, which is an upgraded version of its A330 plane.

Adding to the pressure on Airbus are reports that Boeing is working on a new single-aisle jet that would be based on the advanced technology of its new 787, set to enter service in 2008 and the industry's first commercial jetliner with a composite wing and fuselage. The new aircraft would replace the Boeing 737.

Chicago-based Boeing has also gone on the offensive on the trade front with the U.S. government, calling on the World Trade Organization to put a stop to subsidies for the development of Airbus aircraft.

“Boeing is thinking of moving things up by replacing the 737 and that could throw Airbus off balance in its strategy,” Mr. Fay said.

Airbus's marquee plane is its super-jumbo A380, which can carry as many as 800 passengers and is slated for service starting next year. It has garnered about 130 orders so far.

After clinching the Air Canada order, there is talk that Boeing is poised to win over Northwest Airlines Corp. with a firm commitment to 18 Dreamliners.

The 787 is making a name for itself as one of the fastest-selling new passenger jets in commercial aviation history, even before it takes to the skies.

“The key here is that the 777 has been about the only aircraft in its class better than anything else Airbus had to offer. Airbus has been cleaning Boeing's clock. Now, the question is whether the [225-seat] 787 can do that in the segment just below the [350-plus seat] 777,” said Richard Aboulafia, an airline consultant with the Teal Group in Fairfax, Va..

Boeing has also been aggressive on pricing, observers say.

“There's a lot of gamesmanship going on, like on price,” said one analyst who did not want to be named.

Since 2001, Airbus has sold more planes every year than Boeing, but Boeing's new head of commercial aircraft sales, Scott Carson, has vowed to reverse the company's fortunes in 2005.

Last year, Airbus took 53 per cent of global airliner sales.

Air Canada to order Boeing 777s and 787 Dreamliners
25 April 2005


Air Canada is planning a wide-body fleet renewal plan that includes up to 36 Boeing 777s and up to 60 Boeing 787 Dreamliners. Air Canada will use the airplanes to modernize its existing fleet and improve operating efficiencies.

The wide-body renewal plan includes firm orders for 18 Boeing 777s, plus purchase rights for 18 more, in a yet-to-be-determined mix of the 777 family's newest models: the 777-300ER, the 777-200LR Worldliner, and the newly announced 777 Freighter. Air Canada's 777 deliveries are scheduled to begin next year with the arrival of three 777- 300ERs in 2006. The carrier's first 777-300ERs will operate its Vancouver- Tokyo service.

The renewal plan also includes firm orders for 14 new Boeing 787 Dreamliners, plus options and purchase rights for an additional 46 airplanes. Air Canada's first 787 is scheduled for delivery in 2010.

"Our decision to modernize our fleet with the 777 and 787 Dreamliner will move Air Canada into a clear leadership position among North American international carriers with the world's two newest and most efficient twin- engine, long-haul airplanes," said Robert Milton, Chairman, President and CEO of ACE Aviation Holdings, the parent company of Air Canada. "No other carrier in North America is in a position to order the latest and most capable variants of the 777, the 200LR, and the 300ER and also the 787. The superior customer comfort and operating economics of these aircraft will put us in the company of the leading European, Middle East and Asia Pacific carriers.

"Our analysis of these aircraft pointed to overwhelmingly attractive economics. We have estimated the fuel burn and maintenance cost savings alone on the 787 to be approximately 30 per cent versus the 767s they will replace. Particularly important in the current high fuel price environment is that the savings on these two line items alone will be more than twice the incremental ownership costs in acquiring these aircraft. Our only disappointment is that Boeing will not be able to deliver us our first 787 aircraft until 2010.

"The agreement with Boeing is very attractive financially as the operating cost of the 777 and 787 will be significantly less than our current airplanes they will replace, the acquisition costs will be spread over several years, and the asset values of the aircraft we will replace and sell are significant. As we are planning to dispose of more than 60 wide-bodies over the next decade, the net cash outlay for acquisition of these new aircraft is expected to be greatly reduced. The average age of the Boeing 767s to be replaced will be approximately 22 years."

The order is subject to several conditions including final documentation. The companies expect to finalize the agreement by mid-year.

Boeing Commercial Airplanes President and CEO, Alan Mulally, noted the significance of the timing of the Air Canada order. "The timing of Air Canada's decision is critical for locking in rapidly disappearing early delivery positions for the 787, which is essentially sold out through 2010," said Mulally. "Air Canada also has secured three of the very few remaining near-term delivery slots for the 777."

The 777 and 787 are uniquely suited to meet Air Canada's current route structure and growth plans, which include long-range, non-stop routes for both passengers and cargo, with an increasing emphasis on growing markets in Latin America and China. Operating in the same fleet, the 777 and 787 will allow Air Canada to tailor capacity to seasonal demand with two aircraft types that fly the same speed and range yet offer different seating capacities.

"The new aircraft improves Air Canada's ability to manage its capacity more in line with the dynamic marketplace by giving it a constant stream of efficient aircraft guaranteeing its ability to take advantage of growth opportunities, such as China, or through retirement of older aircraft, shrink its capacity while improving the mix of extremely fuel efficient aircraft," said Montie Brewer, President and CEO of Air Canada.

The delivery of three 777s in 2006 will allow Air Canada to implement its recently announced expansion of services to China using existing wide-body aircraft. Air Canada will introduce daily Toronto-Shanghai non-stop service in summer 2006 and will increase flights to daily service between Toronto and Beijing. A daily Vancouver-Guangzhou non-stop service is planned to begin summer 2007. From its main Toronto hub, Air Canada also expects to start Toronto- Guangzhou cargo service in 2007 and plans to eventually add Tianjin to its freight operations. The expansion of passenger and freight services to China has been made possible by the new bilateral air agreement between Canada and China.

From its main hub in Toronto, Air Canada currently operates non-stop flights to Hong Kong, Tokyo, Seoul and Delhi. From its Asia Pacific gateway in Vancouver, Canada's flag carrier serves Hong Kong, Shanghai, Beijing, Tokyo, Osaka, Nagoya and Seoul with daily non-stop flights.

Incentives from P.E.I. spark airline dogfight
Air Canada threat to drop service over pact with WestJet
Chris Sorensen
27 April 2005
National Post

Air Canada is threatening to stop flying to Prince Edward Island after the province coaxed summer service from rival WestJet Airlines Ltd. by promising to guarantee ticket sales and provide free advertising.

In a terse letter to P.E.I. Premier Patrick Binns, the country's largest carrier said financial incentives offered to WestJet, totalling nearly $500,000, amount to a government subsidy of a competing airline, and that Air Canada was cancelling plans to add extra service to Charlottetown this summer.

As well, Lyse Charette, Air Canada's senior director of corporate affairs, said in the letter the airline is now considering a "review" of its regular service to the island province, which had been part of the carrier's network "for many years."

"Your government's subsidies of close to one-half million dollars significantly distort the marketplace and now force Air Canada to review the continuance of our services ... beyond the 2005 peak summer season," Ms. Charette wrote.

An Air Canada spokeswoman declined to comment on the situation.

The Province of P.E.I., in the midst of a push to stimulate tourism to the province of 138,000, said last week that WestJet would begin flying seasonally between Toronto and Charlottetown in June, and that it would provide a "partial revenue guarantee" to WestJet to a maximum of $300,000.

In addition, the province pledged to provide "marketing support to create awareness of the new service," according to a news release dated April 20. The campaign is to include full-page advertising in WestJet's in-flight magazine and advertising on travel Web sites in Toronto, Ottawa, Calgary and Vancouver. Money will also be spent on a four-week newspaper advertising campaign in Toronto and Vancouver, the release said.

"These and other activities for tourism marketing support of the new flight have been budgeted at $175,000," said Philip Brown, the province's Minister of Tourism, in the statement. "Our department will be working closely with WestJet to ensure Canadians are strongly encouraged to visit P.E.I. this summer season."

Sean Durfy, WestJet's executive vice-president of marketing and sales, said the agreements were "standard industry practice," particularly when it comes to serving smaller airports with limited markets.

"There was the need for the province [of PEI] and the airport authority to support us and make it economically viable," Mr. Durfy said.

"These are things that airports do to get companies like WestJet to come in."

Air Canada took a shot at WestJet in the letter to Premier Binns by questioning WestJet's commitment to the province.

Ms. Charette noted that Air Canada had historically flown to P.E.I. year-round -- not just during the most profitable summer months. She added that revenue generated during the summer is used to make up the marginal performance of the routes during the remainder of the year.

A spokesperson for Tourism P.E.I. could not be reached yesterday.

Debtholders await Air Canada payment
Barry Critchley
28 April 2005
National Post

A few more weeks. That's the word from Ernst & Young, the court-appointed monitor for Air Canada, as to the length of time that debtholders of the former bankrupt airline will have to wait before they receive their final payment. "There will be a second distribution," said a source familiar with the process. "And we are hoping to have that in the next two or three weeks. At that time the remaining shares or cash will be sent out."

And that's good news for investors who have wondered about the process that started last October. And given the way that shares in ACE Aviation Holdings Inc., the holding company for Air Canada, have traded, some investors are sitting on a bit of a gold mine.

As part of Air Canada's emergence from bankruptcy, debtholders were required to submit their claims to Ernst & Young. At that time, the debtholders were also offered the opportunity to participate in a rights offering. That offering gave the holders the right to buy stock at $20 a share. Would-be-investors had to fill out a subscription agreement and send in a cheque.

A few weeks later investors received the first instalment of shares. The number of shares received initially was in line with what investors were told at the time they filled out the subscription agreement. Investors were also told the maximum number of shares they would receive. Since then there's been nothing.

Why the delay? It seems not all the claims have been settled. "We don't know the value of the pool of claims because not all the claims have been settled," added a source. Indeed, the process was complicated because the number of shares an individual debtholder received -- and the number of rights they received -- was related to the amount of the claims submitted by that group of debtholders.

Air Canada has sought subsidies in past, P.E.I. premier alleges WestJet deal not a first
Nicholas Van Praet
28 April 2005
National Post

MONTREAL - Prince Edward Island Premier Pat Binns, under fire for his government's decision to woo WestJet Airlines Ltd. with nearly half a million dollars in incentives in exchange for summer service, says Air Canada has asked for similar support in the past and has not been averse to receiving subsidies.

Air Canada said it would cancel its extra service to P.E.I. this summer and is threatening to pull out of the province altogether over the WestJet deal. It says the subsidy creates an unlevel playing field.

Some airline industry players in Quebec said yesterday they found Air Canada's clamouring for a level playing field ironic because a special deal the carrier struck with the government of Quebec props up its near-monopoly in that province.

"There's no level playing field in Quebec," said John McKenna, president of a trade group representing Quebec carriers. "This carrier is getting millions to provide a service into a region and the others get nothing."

For his part, Mr. Binns told the P.E.I. legislature that he found Air Canada's outrage surprising. The premier said Air Canada accepted a revenue guarantee of $250,000 several years ago when it began offering direct flights between Charlottetown and Montreal. He said his government made the offer to WestJet because existing summer service to the province was insufficient.

"Given the fact that they were the first carrier to ask [us] to be supported, it's surprising that they would take exception to support being given to someone else," Mr. Binns said Tuesday. The premier was not available yesterday.

In a terse letter sent to Mr. Binns on April 21 and reported in the Financial Post yesterday, Air Canada's director of corporate affairs said the nearly $500,000 worth of guaranteed ticket sales and free advertising P.E.I. is offering WestJet amounts to a government subsidy of a competing airline. The letter said Air Canada is now considering a "review" of its regular service to the island. Air Canada is the only airline that offers year-round service to P.E.I.

Air Canada spokeswoman Isabelle Arthur said yesterday the airline has been approached in the past and has struck deals with small communities across Canada in cases where the airline couldn't justify service under normal conditions and where its exit would have left the town with limited or no air service. "This can in no way be compared with the Charlottetown situation," she said.

I couldn't find the Toronto Star article regarding this, but I think it's intriguing, though I'm not sure how it'd work out
_________________
Air Canada has AmWest, US Airways merger ties


Dawn Gilbertson
The Arizona Republic
Apr. 30, 2005 12:00 AM
Another airline has been linked to a possible America West merger with US Airways.

The latest speculation focuses on Air Canada. The Toronto Star this week quoted a "Wall Street source" as saying the carrier may be in talks with both US Airways and America West Airlines in a deal that may see Air Canada take on international traffic while a combined US Airways-America West handles domestic U.S. traffic. It did not mention how such a deal would be structured.

Air Canada's chairman didn't rule out a possible merger for the airline on a conference call, the newspaper reported, but he seemed to be commenting on its role in industry consolidation in general. The discussion was a footnote in a story about the airline's $6 billion order for Boeing jets this week.

"Consolidation in the North American industry is inevitable," said Robert Milton, chairman of the airline's parent company. "To the extent Air Canada is or isn't part of that is yet to be determined."

The airlines are not strangers to each other.

Air Canada and US Airways are both members of the same airline alliance, the Star Alliance, a network of airlines that feed passengers to each other globally. They also have both used Seabury Group for investment banking.

On the America West side there's a Texas Pacific Group connection. The private equity firm brought America West out of bankruptcy a decade ago and, together with Air Canada, invested in Continental Airlines to bring it out of bankruptcy in 1993.

TPG still owns a controlling interest in America West and is seen as a key player in any merger. The extent of its role is unclear.

Rick Schifter, managing partner of TPG, wouldn't comment at an airline conference in Phoenix this week. But his overall comments on industry consolidation seemed to suggest that the airline is lukewarm on any further investments at this point.

He said the industry is "still sucking wind" because the success of low-cost carriers have brought about dramatic change in the rest of the industry.

"That gives us some pause as we look at the industry today," he said.

He also said the firm, a legendary bargain hunter, doesn't see a lot of steals out there because there is so much capital chasing few deals. That drives prices up.

He said they continue to keep an eye on the industry, "but we're fairly cautious at this stage."

NEW YORK -- Consumer confidence declined in April for the third consecutive month, signaling Americans' concerns that economic growth is leveling off. But one area of the economy is still white hot: the government said sales of new homes shot up 12.2 percent last month to the highest level in history.

NEW YORK -- American Express Co., the consumer finance and travel company, reported a 19 percent increase in earnings for the first quarter, driven by strong growth in its card business.

NEW YORK -- A federal judge gave preliminary approval Tuesday to a deal under which auditor Arthur Andersen LLP will pay $65 million to settle allegations it failed to protect investors from WorldCom's historic accounting fraud.

NEW YORK -- Martha Stewart Living Omnimedia Inc. reported a smaller first-quarter loss than a year ago, but the company struggled with a 13 percent revenue drop, primarily from the absence of its daily syndicated TV show while its namesake founder was in prison.

ADVERTISEMENT

WASHINGTON -- The Supreme Court ruled Tuesday that people who cheat foreign governments of tax revenue can be prosecuted under U.S. law for wire fraud.

In a 5-4 decision, the court upheld the fraud convictions for three men accused of sneaking thousands of cases of whisky, vodka and rum into Canada from the United States and avoiding millions of dollars in Canadian taxes.

Union officer decries more open skies
Toronto Star
3 May 2005

Expanding the "open skies" agreement between Canada and the United States, a move championed by Air Canada, would result in smaller Canadian communities losing service and could help propel other Canadian airlines into insolvency, an official with Air Canada's largest union says.

In a presentation yesterday before the House of Commons standing committee on transportation, Paul Lefebvre, president of a local in the International Association of Machinists, argued Canada should not be so quick on freer trade in the airline industry.

"We don't believe that our industry is in any shape to benefit from further liberalization at this time," he said.

Lefebvre said further liberalizing the open skies agreement with the U.S. might lead some Canadian carriers to drop service to smaller communities, particularly in the Maritimes and Prairies, as they move to defend more lucrative large markets.

Canadian carriers might ultimately face the prospect of bankruptcy from the added competition because the U.S. market is already deregulated, he added.

Bilingualism a must for airline
03 May 2005
National Post

The federal government isn't budging on a commitment to hold Air Canada to its official languages obligations, despite protests from the airline that the requirements put it at a competitive disadvantage. Jean Lapierre, the Transport Minister, said yesterday Ottawa will amend legislation to ensure Air Canada's new corporate structure, devised during its recent bankruptcy protection, continues to meet language requirements that have been law since the airline was privatized in the late 1980s. Other Canadian air carriers, including rival WestJet Airlines Ltd., do not have the same obligations. In addition to providing services in both official languages, the amended legislation will require the airline's parent, ACE Aviation Holdings Inc., to maintain its head office in Montreal. It will also place official languages requirements on new subsidiaries.

While Air Canada had promised to continue providing services in both French and English, the carrier had nevertheless asked Ottawa for a "level playing field" that did not see Air Canada targeted with specific legislation.

Spying led to airport switch, court told
WestJet moved hub to Toronto after stealing Air Canada data, filing alleges
3 May 2005
The Globe and Mail

WestJet Airlines Ltd. shifted its eastern hub to Toronto from Hamilton after stealing confidential data from Air Canada in an elaborate spying scheme, according to new court documents that show what forensic auditors uncovered on a WestJet co-founder's hard drive.

Air Canada, in the latest instalment in the corporate espionage case that has gripped the country's airline industry, filed new exhibits in support of its $220-million lawsuit against WestJet. Since the lawsuit was launched nearly 13 months ago, Calgary-based WestJet has repeatedly denied wrongdoing.

Last fall, Montreal-based Air Canada and a unit received court approval to hire H+A Computer Forensics Inc. to seize and analyze seven WestJet computers, including the hard drive belonging to Mark Hill, a co-founder and former vice-president of strategic planning who resigned from the airline last July.

“The defendants used the plaintiffs' confidential information in order to assist them in planning WestJet's change of its eastern base from Hamilton to Toronto,” said an affidavit signed by Benjamin Smith, Air Canada vice-president of planning.

Amid much fanfare, WestJet announced in January, 2004, that it would shift its eastern hub to Toronto's Pearson International Airport from Hamilton's Munro International Airport — which it did on April 18, 2004, entering the lucrative Toronto-Montreal-Ottawa triangle.

Mr. Smith said Mr. Hill stored “flight comparison reports” on his hard drive, compiling “a detailed comparison of WestJet flights at specific times between Montreal-Hamilton and Air Canada's flights at specific times on its Montreal-Toronto route.”

Mr. Smith also said Mr. Hill gathered data on WestJet's Ottawa-Hamilton route compared with Air Canada's Ottawa-Toronto service.

Spreadsheets found on Mr. Hill's hard drive, entered as Exhibit C attached to Mr. Smith's affidavit, show detailed information on Air Canada's flights, including their so-called load factor — the proportion of available seats filled.

The spreadsheets from November, 2003, use airport codes for Toronto (YYZ), Hamilton (YHM), Montreal (YUL) and Ottawa (YOW), and line by line, show which Air Canada flights were most popular and which didn't perform so well. For instance, Air Canada Flight 415 at 2 p.m. on Wednesdays in November, 2003, from Montreal to Toronto had 96.9 per cent of the available seats filled, compared with a load factor of 61.5 per cent on Air Canada Flight 401 at 7 a.m. on the same route, also on Wednesdays. Mr. Hill's reports contain details on individual flights, such as Air Canada's average seat capacity and load factors Monday through Sunday.

Air Canada launched its lawsuit against WestJet on April 6, 2004, when it named Mr. Hill as a co-defendant and alleged that he was the mastermind behind WestJet's snooping into Air Canada's special reservations website.

WestJet spokeswoman Gillian Bentley declined comment yesterday, saying the case is still before the Ontario Superior Court, but the carrier has said that Air Canada's internal website wasn't confidential, and flight information could be obtained by counting passengers boarding planes.

Previous court exhibits, introduced last year, included shredded documents retrieved from Mr. Hill's trash outside his home in the Victoria suburb of Oak Bay by private investigators hired by Air Canada.

Air Canada, which emerged from 18 months of bankruptcy protection last September, alleges that WestJet gained an unfair competitive advantage by hacking into the special website for Air Canada employees. None of the allegations has been proved in court.

Mr. Smith's affidavit accuses WestJet of “identifying and targeting the plaintiffs' most profitable flights and times and adjusting WestJet's schedule accordingly, planning WestJet's expansion into new routes and optimizing WestJet's revenue on specific routes.”

In another document found on Mr. Hill's hard drive, he “seems to provide instructions that WestJet should reallocate aircraft on specific routes because Air Canada had load factors above 75 per cent on these routes from mid-March through mid-April, 2003,” Mr. Smith said.

Those popular routes included: Vancouver-Montreal, Winnipeg-Montreal, Victoria-Toronto, Vancouver-Ottawa, Calgary-Montreal and Calgary-Victoria.

A third document found on Mr. Hill's computer compares WestJet's load factors with Air Canada's in the second quarter of 2003.

Mr. Smith alleges in his affidavit that WestJet's planning, bolstered by obtaining confidential Air Canada data, extended into the Atlantic, with WestJet carrying out Mr. Hill's recommendations to add afternoon Montreal-Halifax flights and Halifax-Montreal night service in September, 2003.

Two other WestJet co-founders — chief executive officer Clive Beddoe and executive vice-president of guest service Donald Bell — are also among the co-defendants.

Air Canada reports thirteenth consecutive month of record load factors for April

Domestic passenger load factor at 82.0% - highest ever for April
System passenger load factor at 80.5% - highest ever for April

MONTREAL, May 5 /CNW Telbec/ - Air Canada reported a system load factor of 80.5 percent in April 2005, the highest ever for April. The mainline carrier flew 4.7 percent more revenue passenger miles (RPMs) in April 2005 than in April 2004, according to preliminary traffic figures. Overall, capacity increased by 1.1 percent, resulting in a load factor of 80.5 percent, compared to 77.7 percent in April 2004; an increase of 2.8 percentage points. In the domestic market, capacity decreased by 1.7 percent and traffic increased by 4.7 percent resulting in a domestic load factor of 82.0 percent - a 5.0 percentage point increase year over year.

Jazz, Air Canada's regional airline subsidiary, flew 17.0 percent more revenue passenger miles in April 2005 than in April 2004, according to preliminary traffic figures. Capacity increased by 1.4 percent, resulting in a load factor of 70.5 percent, compared to 61.1 per cent in April 2004; an increase of 9.4 percentage points.

Domestic traffic, on a combined basis for Air Canada and its regional carrier, Jazz, rose 7.2 percent.

"Our performance in April marked the beginning of a second year of consecutive record load factors with a 2.8 percentage increase over last year's record for the month," said Montie Brewer, President and Chief Executive Officer. "This ongoing strong performance reflects a definite trend towards increasing customer preference for Air Canada over and above the market's recovery. Air Canada's employees are winning over more and more customers and I am incredibly proud that again in April they handled record volumes with exceptional operational performance. Air Canada has clearly become the airline of choice for Canadians with the lowest fares to the greatest number of destinations on an everyday basis."

More Information : Detailed Data (http://micro.newswire.ca/release.cgi?rkey=1305054944&view=13213-0&Start=0)

Canadian Press
Thursday, May 05, 2005



MONTREAL (CP) - Air Canada and WestJet have both reported high-flying business for April, in the wake of discount competitor Jetsgo's collapse in March.

Montreal-based Air Canada reported Thursday a domestic passenger load of 82 per cent and a system passenger load of 80.5 per cent in April - the highest ever for the month, the airline (TSX:ACE) said. Meanwhile, Calgary-based WestJet Airlines' load factor for April rose to 68.8 per cent, compared with 65.5 per cent in April 2004.

Air Canada also flew 3.3 billion revenue passenger miles in April, a 4.7 per cent increase over April 2004, according to preliminary traffic figures.

WestJet said it posted a 35.1 per cent year-over-year increase in revenue passenger miles - 585.7 million in April 2005 from 433.7 million the year before.

"Our performance in April marked the beginning of a second year of consecutive record load factors with a 2.8 percentage increase over last year's record for the month," said Air Canada CEO Montie Brewer.

"This ongoing strong performance reflects a definite trend towards increasing customer preference for Air Canada over and above the market's recovery."

Clive Beddoe, CEO of WestJet (TSX:WJA), said he's pleased with the operating results.

"Because Good Friday came in March this year, our April 2005 load factor was not bolstered by the Easter long weekend as it was in 2004," he said. "This points to an especially strong performance this April on a year-over-year basis."

The sudden shutdown of cut-rate carrier Jetsgo on March 11 had an impact on the results for the two larger carriers, although neither company mentioned it in their statements.

ACE Aviation Holdings Inc. (TSX:ACE) is the holding company under which the reorganized Air Canada is held.

Smoke on Air Canada Hong Kong - Vancouver flight
Matthew Lee
9 May 2005
Hong Kong Standard

An Air Canada flight was forced to return to Hong Kong after cabin crew saw smoke coming out of a reading light.

The Airbus A343 bound for Vancouver, with 231 passengers and 16 crew members, returned to Hong Kong International Airport shortly after takeoff at 4.03pm Sunday.

An Airport Authority spokeswoman said the control tower was notified at 4.34pm by flight AC 008 about smoke detected on board and asked to return to the airport. ``The flight landed safely at 4.45pm... No one was injured,'' she said.

Fire trucks were standing by near the runway. Preliminary investigations revealed that a reading light inside the cabin had an electrical short-circuit and emitted smoke but did not catch fire.

Investigations continued last night.

Air Canada to cut staff on flights to Europe Union protests cuts
Rick Westhead
Toronto Star
11 May 2005

It may take longer in coming weeks for passengers to get a drink, pillow or a newspaper aboard some of Air Canada's lengthy overseas routes, says the union representing the airline's flight attendants. After paring nearly $2 billion worth of annual costs during its bankruptcy protection, the airline plans to have fewer flight attendants work overseas routes to Europe, a cost-cutting measure that an Air Canada union says will slow service and might even compromise passenger and employee safety.

According to a May 9 letter sent to Air Canada and circulated yesterday to the carrier's 6,700 flight attendants, Pamela Sachs, an official with the Canadian Union of Public Employees, objected to Air Canada's plans to cut by one the number of flight attendants who work on trans-Atlantic flights.

Effective June 1, Air Canada plans to have 10 flight attendants work aboard its Airbus 330 planes, down from the current 11. On routes using Airbus 340 planes, the carrier wants to have nine flight attendants instead of 10, Sachs wrote.

"Everyone knows that if we are required to act as safety professionals on a flight, numbers will make a difference," Sachs wrote in the letter to Susan Welscheid, an Air Canada official. "Furthermore," she wrote, "reducing crew complement will also threaten the health and safety of our members who would be required to do more with less. You have failed to respect the law when developing and implementing new work procedures. And you dangle the prospect of profits ahead of the health and safety of our members."

An Air Canada spokesperson said that even after the airline reduced the number of flight attendants on European-bound flights, it would still exceed Transport Canada's required minimum staffing levels. A spokesperson for the federal regulator couldn't be reached.

In a May 5 letter to the union obtained by the Toronto Star, Welscheid said Air Canada would consider in coming months expanding the cost-cutting move to include other international routes, such as flights to Central and South America and Asia.

"This will ensure our success in remaining competitive within our industry," Welscheid wrote, adding that rising fuel costs were among reasons for the change. "It is our commitment to ensure that safety and customer service on board will not be compromised by these changes."

Air Canada has also hired an unnamed "time and motion expert" from the University of Toronto to "explore other services to improve the service," she wrote. Other moves Air Canada said will improve service include a plan to have two hospitality-class flight attendants, after meals are served, moving to the executive class cabin "to ensure optimal customer service for our premium passengers," Welscheid's letter says. As of July 1, meals in executive class will also be served on a tray.

A move to improve service in hospitality class includes combining bar and meal service, allowing passengers to order beer and wine at the same time they receive their food.

In a bid to pare costs to exit bankruptcy, Air Canada reached an agreement with CUPE for flight attendants to surrender $136 million worth of wage and benefits cuts. Air Canada "cannot change these crew complements with more than four years left in the negotiated collective agreement that was based on this court-approved business plan without consequence," Sachs wrote.

Air Canada's Airbus 330s, which seat 42 executive and 232 hospitality-class passengers, typically fly to destinations including London, Frankfurt and Paris. The 340-series jets seat 42 executive and 225 hospitality-class passengers, and primarily fly to Japan, China and other Asia locations. The A340 planes occasionally fly to European cities, said an airline spokesperson.

Air Canada starts non-stop Toronto-Beijing service
13 May 2005
The Globe and Mail

Air Canada has announced that its first non-stop flights from Toronto to Beijing will begin June 3.

The flights will be the first to directly connect China's mainland with points in Canada as far east as Ontario, the Xinhua news agency reports.

Air Canada will offer three flights a week in June, increasing to four per week in July.

The airline plans to step up its non-stop passenger service between Toronto and Beijing to daily flights by 2006.

Daily non-stop passenger services between Toronto and Shanghai are planned to run from 2006, and between Vancouver and Guangzhou from 2007.

ACE Aviation Sees Outlook Improving As Year Unfolds
By Monica Gutschi
Of DOW JONES NEWSWIRES
13 May 2005

TORONTO (Dow Jones)--Air Canada saw a "dramatic" improvement in operating results immediately following the demise of discount rival Jetsgo last March, with yields, fares and passenger traffic all moving higher.

"I'm pleasantly surprised by what's happening," said Robert Milton, chief executive of Air Canada's parent ACE Aviation Holdings Ltd. (ACE.B.T), adding that Canada's dominant airline "picked up" more of the traffic that might have used Jetsgo than he had anticipated.

That, and better leverage from the company's cost-cutting program, should translate into progressively better results as the year unfolds, Milton said on a conference call.

"We saw some significant increases in yields immediately after the Jetsgo failure," he said. "We've seen now a continuation and acceleration of yield performance going forward."

He said Air Canada managed to produce strong first-quarter results despite "brutal" fuel prices and a domestic fare war in the weeks leading up to Montreal-based Jetsgo's demise. "We are very encouraged with the results from the quarter," Milton said.

ACE Aviation reported a loss of C$77 million or 87 Canadian cents a share, well down from the loss of C$304 million or C$2.53 reported last year. The 2004 numbers included C$132 million in reorganization and restructuring charges.

Its operating loss was C$10 million, down from C$135 million before charges a year earlier.

Earnings before interest, taxes, depreciation and aircraft rent, or EBITDAR, a non-GAAP measure used in the airline industry, totalled C$200 million, up from C$144 million.

Revenue increased 2.6% to C$2.18 billion from C$2.12 billion.

The airline also reported a record load factor for the first quarter of 78%, up significantly from 72.9% a year earlier as passenger traffic rose 5% and overall capacity was cut 2%. Load factor is the percentage of available seats filled.

However, the intense price wars caused yields, or per-seat revenue, to fall 3% in the quarter even as unit costs declined 2%. Excluding the impact of fuel, which rose by 24% in the quarter, unit costs fell by 6% from a year earlier. Jetsgo, which abruptly ceased operating March 11, had been known for its aggressive pricing and rapid expansion across the country.

Calgary-based WestJet Airlines Ltd. (WJA.T) reported a loss of C$9.6 million or 8 Canadian cents in the quarter, mostly due to to weak yields arising from the price wars. WestJet has said average ticket prices rose 15-20% immediately following Jetsgo's filing for bankruptcy protection.

Fares have also gone up at Air Canada but officials refused to say Friday by how much. Air Canada President Montie Brewer would only say he was "happy" at the price increase.

"We are looking forward to a good summer," he said, adding that even with rising ticket prices, "we are still experiencing record load factors. We're not having problems finding passengers."

In fact, the airline will add five wide-body aircraft to its fleet by the summer to take advantage of growing international traffic.

International passenger traffic rose 9% in the first quarter, compared to a 4% increase in Canada. Traffic on transborder routes to the U.S. slipped 1% even as capacity in that region was cut 12% due to growing competition from U.S. carriers.

In Toronto Friday, ACE Aviation is down 3 Canadian cents to C$34.75 as they settled after an early surge following the release of the first-quarter results. The stock traded as high as C$36.50 earlier Friday.

Company Web Site: http://www.aircanada.ca

Air Canada plane lands safely after reporting fire
Associated Press

Hong Kong — A Vancouver-bound Air Canada flight that reported an in-flight fire returned safely to Hong Kong's airport on Sunday about 40 minutes after takeoff, officials said.

The reported fire turned out to be a short-circuited cabin light that emitted smoke but didn't catch fire, and there were no injuries, Airport Authority Hong Kong spokeswoman Jo Ngai said.

She identified the flight as AC008 bound for Vancouver. She said the plane, an Airbus A343, was carrying 231 passengers and 16 crew members.

AC's new booking tools set up to help businesses
GREG COATES
14 May 2005
Toronto Star

Air Canada is making travel management for small- to medium-size businesses simpler with a new online suite of self-service booking tools.

According to officials, the introduction of www.aircanada.com/forbusiness gives business owners the ability to book, track, and monitor travel trends and expenditures for themselves and their employees through the click of a mouse.

Air Transport - Former Air Canada President & CEO Pierre Jeanniot argues in favour of open skies for Canada
12 May 2005
Canada NewsWire

MONTREAL, May 12 /CNW Telbec/ - Former Air Canada President & CEO and Director General Emeritus of the International Air Transport Association (IATA), Pierre Jeanniot would like to see Canada moving towards the active opening up of its air transport market and pushing ahead with the liberalization process that began in the early 1980s.

In an Economic Note published today by the Montreal Economic Institute (MEI), Mr. Jeanniot draws attention to the successful integration of the airline market within the European Union and urges the Canadian government, provided that reciprocal rights can be obtained, to remove its restrictions on "cabotage" - flights between Canadian cities on foreign airlines - and on foreign ownership of Canadian-based airlines.

Illustrative of some of the advantages enjoyed by European consumers since the liberalization of the European market are the sharp increases in the number of routes, in flight frequencies, and in available seats. Increased competition has also exerted downward pressure on fares, particularly in economy class where fares fell by 29% between 1992 and 2000.

The next stage: two scenarios

The document presents two alternative paths presently open to Canada, which would build on the success of the Open Skies Agreement signed by Canada and the United States in 1995.

"The next stage (could) be to seek total integration of aviation markets in North America as part of the North American Free Trade Agreement (NAFTA) or, alternatively, the opening of negotiations with the European Union to develop an agreement similar to what Europe has attempted - so far unsuccessfully - to obtain with the United States."

But whatever the scenario adopted, concludes Mr. Jeanniot, Canada "should take every opportunity that comes up to negotiate an Open Skies type agreement with any country that already has a comparable agreement with the USA. It should also, at the appropriate time, offer similar reciprocal agreements to other liberalized parts of the world."

Under the title: Towards open skies for airlines in Canada, this MEI document has been communicated to the Federal Minister of Transport and all Members of Parliament. It is available at www.iedm.org .

Pierre Jeanniot was President and CEO of Air Canada from 1984 to 1990 and President and CEO of the International Air Transport Association from 1993 to 2002. He is available for media interviews.

ACE Aviation's Maintenance Unit Seeking Global Expansion
By Monica Gutschi
17 May 2005

TORONTO (Dow Jones)--Air Canada Technical Services, or ACTS, may be the least sexy of ACE Aviation Holding's (ACE.B.T) nine business units - but that could rapidly change.

The maintenance branch of Canada's largest airline operator has set its sights on becoming a "Tier One" MRO - maintenance, repair and overhaul operator - within the next five years. To do that, it needs to expand globally and it needs to grow significantly from its current C$700 million in annual revenue.

"Our goals are very aggressive and they will not all come from organic growth," says ACTS president Bill Zoeller. He said ACTS want to be a "major player" in the global MRO marketplace, capturing about 10-15% of what is expected to soon be a US$49 billion market.

That means ACTS will need to establish a presence in both the U.S. and in some of the "lower-cost labor" areas of the world, he said. And that, in turn, means acquisitions, joint ventures or partnerships will be in the cards.

Some could be announced shortly.

Rumors suggest one could be related to a potential merger between US Airways Group (USAIRQ) and America West Holdings (AWA), where ACE Aviation has been touted as an equity partner in order to gain maintenance outsourcing work.

At the same time, Zoeller hints that a large contract is on the verge of being signed with a significant customer, and says ACTS is also working on a number of initiatives globally, and has launched a major marketing campaign. The company is "going after" legacy carriers, start-up carriers, military operators, and "doing some alliances with other companies to spread our expertise around the world."

It most recently captured public attention when it announced a US$300 million maintenance contract with Delta Air Lines Inc. (DAL), which will add some 300 jobs over the next five years.

"We're sort of an unknown part" of ACE Aviation, the holding company created last September when Air Canada emerged from bankruptcy protection. While admitting that fixing planes is "not as sexy" as flying them, Zoeller says the business "can be very profitable and very dynamic."

In fact, ACTS reported revenue of C$180 million in the most recent quarter, while its operating expenses were only C$157 million, making it one of the more profitable of ACE Aviation's four reporting subisidaries. Ted Larkin, analyst with Orion Securities, noted the unit has profit margins "that its competitors must covet."

According to financial documents, ACTS reported pretax margins of 13% in the first quarter, compared to the -4% margins reported by ACE Aviation's air-transport operations.



Bankruptcy Proceeding Drove Out Costs


ACTS was able to drive about 30% to 40% of its costs out during the bankruptcy restructuring process, Zoeller says. The number of employees was slashed by 2,500, to 3,600, while changes in work rules boosted productivity by 50%-60%. Finally, renewed contracts with suppliers cut materials costs by about 35%.

"It really drove us into a very competitive position," Zoeller says. So much so, that BWIA West Indies Airways finds it cost-effective to do its maintenance in Montreal, and for discounter Jetblue Airways Corp. (JBLU) to send its planes to ACTS' Winnipeg site.

The company now has about 100 customers, including Canadian tour operator Transat A.T. (TRZ.B.T), United Parcel Service Inc. (UPS), Canada's Department of National Defence, the Bank of Scotland, FLYi Inc.'s (FLYI) Independence Air, Brazil's Gol Linhas Aereas Inteligentes S.A. (GOL) and Deutsche Lufthansa's (LHA.XE) regional City Line. The unit works on everything from widebody Boeing 767s to narrowbody Airbus 320s to small CRJ200 regional jets.

Its sister companies under the ACE Aviation umbrella, mainliner Air Canada and regional operator Jazz, now represent about 62% of ACTS' total revenue base, but Zoeller hopes to lower that to the 30%-40% range by adding new airlines to the roster.

While ACTS doesn't have guaranteed work with Air Canada, and must participate in an open biddiing process for many contracts, it does have the "right of first refusal" in that if it meets the best price, it's given the job. The relationship will become even more arm's length as it matures, Zoeller says.

ACTS provides four basic kinds of services: heavy maintenance, engine overhaul, component repairs and "other," including line maintenance, quality-control audits, and fleet-management services. Through subcontractors and alliances, Zoeller says it can offer "nose-to-tail" maintenance for all of the aircraft types it services.

Nevertheless, that still doesn't make ACTS a "Tier One" MRO, which Zoeller defines as an operator "that can offer anything to anybody, anyplace" in the world. Lufthansa Technik is one, he says, while Singapore Technologies Aerospace, the world's largest third-party commercial airframe MRO, is just shy of being there. ACTS will "shortly" move into the Tier One ranks, he says.

Overhaul and Maintenance magazine rates ACTS as one of the top 10 MROs in the Americas, with about 2.5 million man-hours in 2004.

Analysts have valued the unit at about C$450-$500 million, or about C$4 a share on a stand-alone basis.

Air Canada parent ACE readies Aeroplan IPO-report

TORONTO, May 18 (Reuters) - Air Canada parent ACE Aviation Holdings could spin off its Aeroplan rewards program into an income trust and sell a minority stake in the initial public offering worth more than C$300 million as early as this week, a Canadian national newspaper said on Wednesday.

The Globe and Mail, citing sources familiar with the plan, said ACE is reviewing the terms of the IPO that would see a syndicate of investment dealers led by RBC Securities sell a minority stake of less than 20 percent of Aeroplan.

The plan gives the popular consumer rewards program a value of at least C$1.5 billion.

An Air Canada spokeswoman told the Globe and Mail that although ACE intends to sell a stake in Aeroplan, she could not provide any details on the structure or timing of the deal.

The company has been weighing a number of options including a plan for a U.S. equity issue, but the idea of an income trust is most favored because of strong demand for trust IPOs.

The Aeroplan IPO would be the first spinoff for the company that emerged from bankruptcy protection at the end of September. It is also considering plans for its aircraft maintenance and regional Jazz airline divisions.

In the first three months of this year, Aeroplan posted a C$21 million operating profit on revenue of C$172 million.

($1=$1.26 Canadian)

May 18, 2005. 06:35 PM
Ottawa approves more Air Canada flights to China

OTTAWA (CP) — The federal government has cleared the way for Air Canada to expand its number of flights to China.
Transport Minister Jean Lapierre announced today that Air Canada and Vancouver-based Harmony Airways have been granted the designation to operate scheduled services between Canada and China.
The announcement came a month after the two countries signed a bilateral agreement to expand air links, in a deal which included safety and security provisions.
"With the expanded rights that were obtained by Canada through the new air agreement with China, carriers will have additional flexibility in their operations and can provide more choices to Canadians travelling to and from China," Lapierre said in a statement.
Air Canada (TSX: ACE.B) is the only Canadian airline currently operating flights to China. For 2005, Lapierre has allocated five additional flights per week to Air Canada to accommodate a new passenger service between Toronto and Beijing beginning next month, and three flights per week for new cargo service between Toronto and Shanghai that began Sunday.
Harmony Airways intends to introduce passenger services to China by operating code-sharing services, whereby an airline sells seats in its name on the flights of another airline.
CargoJet and Air Transat have also expressed an interest in operating services to China.

Aeroplan partial spinoff first step to free value?
Analysts cautious about ACE role in planned merger
21 May 2005
National Post

Air Canada's parent company moved closer toward realizing the full value of its various subsidiaries this week with the partial spinoff of Aeroplan and a pledge to plunge into the debt-laden U.S. airline industry, a decision that has left some analysts on the edge of their seats.

Although industry watchers welcomed the much-anticipated creation of the Aeroplan Income Fund, which will hold a 15% stake in the popular loyalty program, they were more cautious in their response to ACE Aviation Holdings Inc.'s promise to invest US$75-million in the proposed merger between US Airways and America West Airlines.

The deal, which takes effect only if US Airways emerges from Chapter 11, would give ACE Aviation a 7% in the newly merged airline. It would also come with commitments to deliver $1.5-billion worth of aircraft maintenance contracts to Air Canada Technical Services (ACTS) over five years, creating 700 jobs.

The additional work promises to thrust ACTS into the top tier of global aircraft maintenance providers, thereby increasing the likelihood it too will be spun off, in whole or in part, to investors. Of course, that's assuming the newly merged airline is around long enough to require servicing for its combined fleet of 361 jets.

"On the one hand, the deal clearly presents the company with a lucrative opportunity to enhance its revenues and profits from outside sources," said Ben Cherniavsky, an analyst at Raymond James, in a research note. "On the other hand, this upside rests on the fundamental assumption that the newly combined carrier will survive the next few years -- a risky assumption in our view."

US Airways is now mired in its second attempt at a Chapter 11 restructuring, having shaved its annual labour costs by a further US$1-billion. Still, the carrier remains one of the highest-cost operations in a U.S. airline industry increasingly populated by low-cost carriers. Meanwhile, America West has flirted with Chapter 11, but has posted profits recently.

In addition to the maintenance contracts, Air Canada said it could benefit from increased penetration to several U.S. markets, as well as more traffic destined to its international hub airports in Toronto and Vancouver. Neither US Airways nor America West has much of an international presence, which suggests Air Canada, with its overseas routes, could eventually benefit from an expanded code-sharing relationship with the newly-merged carrier.

Marc-David Seidel, a professor at the University of British Columbia's Sauder School of Business, said Air Canada's move to increase its presence in the United States is a necessary gamble if it is serious about returning to profitability.

"It's a risky investment, but it could be very positive for their international traffic, particularly by building their hub to Asia in Vancouver."

Similarly, one analyst, who didn't want his name used, suggested extra revenue from maintenance contracts and other synergies far outweighs the risks of US$75-million investment in the newly merged airline. "Even if you assume that the 7% stake is essentially worthless, you will still get your money back in the first two-and-a-half years," the analyst said.

However, there are still a number of hurdles to be cleared before any of this will come to pass. The two U.S. airlines must have their business plan approved by a U.S. bankruptcy court, sell the idea to labour unions and, possibly, fend off competitive bids for US Airways' assets.

Aeroplan's future, by contrast, is something observers are much more confident about.

ACE Aviation ended months of speculation yesterday by announcing the creation of the Aeroplan Income Fund, which will hold a 15% stake Aeroplan.

Shares climbed about 10% during the past few days on the news of the imminent aeroplan spinoff.

"The Aeroplan public offering represents a giant step forward in the implementation of ACE's strategy of unlocking shareholder value through the monetization of its business units," Robert Milton, chief executive of ACE Aviation, said in a statement.

According to some analyst estimates, the deal could raise as much as $250-million.

ACE AVIATION HOLDINGS INC.
Ticker: ACE/RV
Closing Price: $38.30, UP 34 cents
Market Cap: $3.8B
Annual Revenue: $8.9B (includes predecessor)

15% of Aeroplan converted to income trust
Air Canada parent firm's move 'unlocks shareholder value' Miles, redemption levels won't be affected, the company says
Rick Westhead
Toronto Star
21 May 2005

Air Canada's parent company took a big step forward in its strategy of "unlocking shareholder value through the monetization of its business units," announcing a plan yesterday to sell 15 per cent of its Aeroplan frequent flyer program through an income trust.

Analysts said the move by ACE Aviation Holdings Inc., rumoured for months, could raise as much as $225 million.

ACE, whose shares have spiked by more than 60 per cent since they began trading Oct. 4, is expected in coming months to consider divesting other non-core assets, including its maintenance unit and Jazz regional airline, as it places a priority on expanding into higher-margin international routes in Asia and Latin America.

Aeroplan's miles and redemption levels won't be affected, the company said.

The frequent flyer program, which generates revenue by selling points to companies that then issue them to consumers for making purchases, is among the best success stories in the airline loyalty program industry.

Unlike some of the other loyalty plans, which allow members to redeem points only for flights, Aeroplan's 5 million active members can also redeem theirs for products from companies including Best Buy Co.'s Future Shop and Imperial Oil Ltd.'s Esso gas stations.

"It's far and away one of the best in the industry," said Jeff Johnstone, an editor with Inside Flyer magazine, a newsletter that covers the loyalty points business.

Last year, Aeroplan was ACE Aviation's most profitable division when it turned a profit of $99 million on sales of $509 million. In this year's first quarter, Aeroplan had a profit of $21 million on revenue of $172 million - while Air Canada recorded a net loss of $77 million.

Converting to an income trust will help the company avoid taxes by paying much of its cash flow to investors.

"With the formation of ACE last year, we streamlined and enhanced our corporate structure with a view to maximizing the inherent value of our overall franchise and each of our business units," ACE chief executive Robert Milton said in a statement.

"The Aeroplan public offering represents a giant step forward in the implementation of ACE's strategy of unlocking shareholder value through the monetization of its business units"

The Aeroplan announcement came a day after Air Canada received a commitment for a five-year maintenance contract worth as much as $1.5 billion to service planes for a combined America West Airlines and US Airways. In exchange, ACE Aviation pledged to invest $95 million in the merged company once US Airways emerges from bankruptcy protection.

Air Canada, whose $4 billion market value already exceeds that of the four largest U.S. carriers combined, might use the proceeds from the Aeroplan sale to pay a dividend or buy back its shares.

Even before Air Canada announced the Aeroplan spinoff, some observers had already shifted their gaze to the prospect that the carrier would follow suit with its maintenance unit, formally known as Air Canada Technical Services.

With files from Dow Jones

Big profits seen at Air Canada cargo unit
Expansion instigated: 'It's money that they are leaving on the table right now,' analyst says
Chris Sorensen
26 May 2005
National Post

Air Canada's most valuable payload isn't always the finicky business passengers who pay thousands of dollars for their executive-class tickets, but often the giant containers of unusual cargo stowed in the planes' gaping, metallic bellies.

For example, the country's largest airline is making a fistful of cash this spring flying huge volumes of fresh cherries over the Pacific Ocean to Japan, where locals are willing to pay top dollar for the flavourful red fruit.

"On any given day we could carry up to 30 or 40 tons of cherries," said Claude Morin, vice-president of Air Canada's cargo division. "And when the season is over, they will be replaced by something else.

"When it comes to air freight, if a country can produce a premium product, there will always be people somewhere who will pay whatever it costs to get it to market."

In fact, all sorts of perishable food items -- ranging from Atlantic lobster, to butchered horse meat, to fresh limes and asparagus grown in Peru -- are increasingly becoming a growth market for Air Canada's cargo unit, which, like all of ACE Aviation Holdings Inc.'s operating divisions, is in the midst of a significant expansion effort in order to help boost the value of the parent company.

Analysts say the cargo division is poised to become the company's next big profit centre behind the Aeroplan loyalty program, in the midst of being partially spun-off as an income trust, and Air Canada Technical Services, which is on the road to becoming a global aircraft maintenance supplier.

"There's a big market in cargo and its growing," said Jacques Kavafian, an analyst at Research Capital. "And for Air Canada, it's money that they're just leaving on the table right now."

Air Canada's cargo unit, which also does a brisk business flying car parts between Detroit and Germany for DaimlerChrysler AG, pulled in nearly $600-million in revenue in 2004 -- a number Mr. Morin has said he plans to double within five years. He said the subsidiary has identified 12 to 15 international markets for expansion in Europe, South America and Asia, which is currently responsible for a growing volume of trade with North America.

In a bid to take advantage of an expanded air services agreement between Ottawa and Beijing, Air Canada this month launched an all-cargo service between Toronto-Shanghai using a leased MD-11 freighter and said yesterday it will boost frequency on the route from three to five times a week. The airline is also planning a stop in Calgary for the freighter, which will give the booming prairie city a direct cargo link to Asia and Toronto.

Mr. Morin said the ultimate goal is to fly a dedicated fleet of cargo-carrying aircraft, as opposed to relying solely on the cargo capacity it purchases on Air Canada's existing passenger jets. In an effort to realize this goal, the company has already leased two MD-11 freighters and is looking at acquiring two Boeing 777 freighters as part of ACE Aviation's recent decision to purchase 32 new jets from the U.S. airplane manufacturer.

"I can see a point, in about three to five years, when about about 30% to 40% of our capacity is handled by freighters and about 60% is handled by twin production (planes that fly both passengers and cargo)," Mr. Morin said. "That's a nice balance because twin production is always very attractively priced, but you can still add capacity on key lanes where demand is very strong."

Air Canada once operated a small fleet of DC-8 cargo aircraft, but the business underwent a restructuring in the 1990s as its mainline carrier acquired newer Airbus and Boeing passenger jets that boasted better fuel efficiency, but still retained significant cargo-carrying capacity.

But while the changes saved money, it also created problems.

In 2003, during the peak of the SARS (Severe Acute Respiratory Syndrome) crisis in Asia, Air Canada dramatically scaled back its passenger flights to places like Hong Kong, leaving its cargo division with almost no lift to sell to freight forwarders, whose business was relatively unaffected by the outbreak.

Mr. Morin said the acquisition of new all-cargo planes will reduce the chances of a similar situation repeating itself, while allowing Air Canada Cargo to capture a bigger share of the overall market.

However, Air Canada isn't the only one eyeing cargo as a growth opportunity.

WestJet Airlines Ltd. is also adding more cargo capacity by virtue of rapidly expanding its passenger network. In addition, WestJet says it is considering overseas flying once it receives a special designation from regulators that allows it to operate its twin-engine Boeing 737s over large bodies of water.

A more immediate threat comes from CargoJet Canada Ltd., which has applied to federal regulators, along with a handful of other cargo operators, to begin offering service to Asia.

Ajay Virmani, CargoJet's CEO, formed the company in 2001 after purchasing the cargo operations of Canada 3000, which went bankrupt following 9/11. He has since doubled CargoJet's revenue and is in the process of converting the company into an income trust.

According to a prospectus filed with regulators, Cargojet provides about half the capacity for dedicated, overnight cargo transport in Canada. It generated $101-million in sales in 2004 with earnings before interest, taxes, depreciation and amortization of $9.5-million, the document says.

In addition to overseas markets, Cargojet said in the filing it sees further market opportunities in Canada as passenger airlines increase their reliance on smaller, regional jets for domestic flights. Air Canada is currently in the midst of deploying regional jets on domestic routes.

Mr. Morin considers Canada to be a "mature" domestic market for cargo, and said the carrier's shift to operating regional jets won't necessarily put it at a competitive disadvantage. "We will have less capacity, but increased frequency," he said.

Rick Erickson, a Calgary-based airline analyst, said it's about time Canadian air carriers woke up to the value of building their air freight businesses, particularly when it comes to countries like China.

"Canadian carriers have been absolutely blinkered to cargo," Mr. Erickson said.

"We've allowed foreign carriers to reap significant profit, and our industry is now dependent on capacity provided by foreign operators. Canadian carriers only carry something substantially less than 25% of the cargo the country generates. That's just wrong."

Air Canada Increases Shanghai Service to Five Times a Week
Will Introduce Prime Time Transcon Freighter Service

MONTREAL, May 25 /CNW Telbec/ - Following the successful launch of all-
cargo services between Toronto and Shanghai on May 15, 2005, Air Canada today announced its plans to introduce prime-time freighter service between Toronto and Calgary as it increases its Canada-China cargo flights from three to five times weekly. The new services will link Alberta to the rapidly expanding Chinese market using an MD-11 freighter aircraft capable of carrying 84 tonnes of cargo.

Air Canada plans to offer five flights per week (except Friday and Saturday) Toronto-Shanghai effective June 20, 2005. All flights are planned for a prime night time departure from Toronto of 23:30 hours. The carrier intends to operate four of the weekly flights (Monday through Thursday) via Calgary providing much needed additional cargo capacity in the key Ontario to Alberta market as well as linking Alberta to the Chinese market. Start-up date for the Calgary service is yet to be determined.

The service will further capitalize on the recently negotiated Canada-China bilateral air services agreement by linking the Alberta market to Shanghai, one of the fastest growing cities of the world. This expansion of cargo services is subject to Air Canada receiving all necessary approvals. "The strong customer response to our new Toronto-Shanghai all-cargo service provides us with the exciting prospect of introducing prime-time wide-body scheduled cargo service between Toronto and Calgary while expanding dedicated freighter services to Shanghai from our main Toronto hub," said Claude Morin, vice president cargo for Air Canada. "The new flights linking the Ontario and Alberta markets represent Canada's first ever domestic wide-body scheduled cargo service while the Calgary-Shanghai link will improve access from Alberta to the rapidly expanding Chinese market."

Garth Atkinson, President and CEO of The Calgary Airport Authority commented, "We are pleased that Air Canada will provide our shipping community with direct access to the emerging Chinese market from Calgary. As Calgary is consolidating its position as Western Canada's international logistics hub, we would like to thank Air Canada for recognizing Calgary's potential and for helping us make our region more competitive on a global scale."

Air Canada provides scheduled and charter air transportation for passengers and cargo to more than 150 destinations on five continents. Canada's flag carrier is the 14th largest commercial airline in the world and serves more than 27 million customers annually. Air Canada is a founding member of Star Alliance providing the world's most comprehensive air transportation network.

Newest Jazz jet set for takeoff
Bombardier delivers first of 15 Jets to fly some Air Canada routes
Allan Swift
Canadian Press
28 May 2005

MONTREAL -- Air Canada Jazz took delivery of its first Bombardier CRJ-705 aircraft yesterday, described as a turning point for the regional airline taking over some domestic and cross-border routes from Air Canada.

Jazz will take delivery this year of 15 CRJ-705s, configured with 75 seats, the most seats Jazz can operate under an agreement with Air Canada and the pilots' unions of both airlines.

CEO Joseph Randell said the new fleet will allow Jazz to take over some routes from Air Canada as the larger airline focuses on international destinations like Asia. "This signifies a major turning point in our history."

The new jets will put Halifax-based Jazz into a stronger position to be partly spun off by ACE Aviation Holdings, which has long suggested it as a candidate for a share issue. ACE announced last week it will spin off about 15 per cent of its Aeroplan subsidiary, a sister company to Jazz, into a new income trust.

The first CRJ-705, which has a list price of $32 million (U.S.), will enter service June 1 between Calgary and Houston, geared for oil executives. Jazz will operate three return flights a day between the two cities, replacing two daily flights currently operated by Air Canada with the larger Airbus A319s.

Randell said the 75-seat planes will be used to add frequencies to high-density routes such as Toronto-Montreal, and also lead to new direct routes like Toronto-Houston and Toronto-Dallas. It has 10 business class seats and 65 in economy.

Yesterday, monitor Ernst and Young reported that proven creditor claims against the airline, which emerged from creditor protection last year after an 18-month restructuring, totalled $8.28 billion.

Creditors received about 10 cents on each dollar they were owed in the form of shares of ACE Aviation Holdings, the new parent company of Air Canada. The shares, which started trading for $20, closed up 10 cents at $37.98 on the Toronto Stock Exchange yesterday.

Aeroplan believes trust has cash flow to fly
Report cites fees paid by partners
BRENT JANG
TRANSPORTATION REPORTER
30 May 2005
The Globe and Mail

Financial partners and Air Canada provide 90 per cent of Aeroplan's revenue, establishing a solid base for growth, according to the loyalty program's preliminary prospectus to become an income trust.

The document shows that Aeroplan's business model, first and foremost, relies on revenue from various business partners paying for the right to purchase and award Aeroplan miles.

There are also two key but lesser-known ingredients in the reward program's recipe for success: the “breakage” rate — miles never redeemed — currently estimated at 17 per cent; and the “float” of a 30-month average time lag between Aeroplan selling miles to business partners and incurring the cost of redemptions for rewards such as Air Canada flights.

Last year, Aeroplan's revenue totalled almost $700-million. Of that amount, financial services partners accounted for 63 per cent, Air Canada 27 per cent, other travel services 8 per cent and consumer products partners the remaining 2 per cent.

ACE Aviation Holdings Inc., the parent of Air Canada and Aeroplan, is providing details of the popular reward program in a 154-page prospectus, hoping to entice investors to buy trust units expected to go on sale by the end of June.

Investors examining Aeroplan's merits could also look in their wallets to find out why the customer loyalty program is confident that it has the steady cash flow to ensure a smooth conversion next month into a new trust.

Aeroplan chief executive officer Rupert Duchesne recently asked a business audience to count the number of credit cards they had tied to loyalty points and, right on cue, out of the wallets came CIBC Aerogold Visa and American Express AeroplanPlus cards, among many others.

Canadian Imperial Bank of Commerce and American Express Canada Inc. are two key reasons that Aeroplan believes it will prosper because those financial institutions pay fees to the loyalty program.

Since May 20, when ACE announced that it will be selling off an 18-per-cent stake in Aeroplan, company officials have declined to comment on the prospectus, citing the “quiet period” for the new Aeroplan Income Fund.

After subtracting various expenses, there could be $140-million this year in cash distributions available to unitholders, the prospectus said.

The fund will have a yet-to-be-determined number of units priced at $10 each.

Details on the size of the initial public offering are expected by the end of June, when the final prospectus is scheduled to be completed. The yield could be in the neighbourhood of 8.75 per cent, said Harry Levant, an independent income trust analyst.

“We consider the distributable cash estimates to be aggressive but achievable,” Mr. Levant wrote in his Aeroplan analysis.

Aeroplan benefits from the so-called margin or spread between how much it charges to sell miles to its business partners and how much it costs to purchase a product or service from those partners.

The average cost to Aeroplan to purchase a reward from one of its partners is almost 1 cent a mile. Based on 15,000 miles, for instance, that works out to an average cost of $148.29, covering the gamut of rewards such as flights, electronics and vacations. Air travel rewards were the most popular choice last year, with 90 per cent of consumers choosing flights.

“Upon the redemption of Aeroplan miles by its members, Aeroplan incurs the cost to acquire the desired reward, which in aggregate is less than the revenue received from the sales of the air miles,” Mr. Levant said. Aeroplan, founded by Air Canada in 1984, has five million active members.

As part of Aeroplan's strategy, members are being encouraged to “double dip” — for instance, buying Esso gasoline with a CIBC Aerogold Visa card and thereby collecting Aeroplan miles from both CIBC and Imperial Oil Ltd.'s Esso retailing chain, Mr. Levant noted.

Aeroplan, which has 60 partners representing more than 100 brands, hopes to diversify its revenue base.

Fadi Chamoun, an analyst with UBS Securities Canada Inc., estimates the new trust's total value will be between $1.56-billion and $1.77-billion. Industry sources add that the IPO could be for nearly 18 per cent of Aeroplan, including an overallotment option, issuing trust units worth almost $288-million. ACE will retain about 82 per cent of the Aeroplan Income Fund.

A portion of the proceeds from the Aeroplan offering will be distributed to ACE by the end of June.

BE gets $50 million Air Canada order
31 May 2005

WELLINGTON, Fla. (AP) - BE Aerospace Inc., a maker of airplane seats and cabin components, said Tuesday that it received a $50 million contract from Air Canada to upgrade seating on 143 aircraft.

BE will provide the Montreal-based carrier with its Spectrum family of coach and first class seating, supporting Air Canada's plan to outfit all its mainline planes with personal, seat-back video systems. The touch-screen video systems will be supplied by another company, BE said. Air Canada is a unit of Saint-Laurent, Quebec-based ACE Aviation Holdings Inc.

BE expects to begin deliveries in late 2005.

Products for existing aircraft account for about 60 percent of BE's sales.

BE Aerospace shares rose 16 cents to $14.59 in morning trading on the Nasdaq.

Air Canada Jazz brand new CRJ-705 Jet departs Calgary for Houston giving travellers more choice and increased flights

CALGARY, June 1 /CNW Telbec/ - The first Bombardier Canadair Regional Jet 705 in commercial service, operated by Air Canada Jazz, departed from Calgary to Houston today. Air Canada Jazz is the world's first operator of the 75- seat, Canadian-made aircraft.

"We are delighted to have the first CRJ-705 in the fleet link North America's two vibrant oil patch centers, Calgary and Houston, giving business travellers between both cities more choice with increased flights and more convenient departure times," said Ben Smith, Vice President, Network Planning. "The addition of these jet aircraft to the Air Canada Jazz fleet will allow us to significantly enhance our customers' travel experience, offering superior
comfort and choice in non-stop markets served."

Effective July 1, Calgary-Houston flights will increase to three daily, offering business travellers in either city a choice of morning, mid-day or evening flights timed for convenient connections to and from Air Canada's worldwide network. Flights will depart Calgary at 07:45, 12:15, and 18:15, and will depart Houston at 07:40, 13:25 and 17:55.

Jazz took delivery of its first CRJ-705 aircraft, operating today as AC8102, in a ceremony held at Bombardier's facility in Montreal on May 27 and will be taking delivery of up to three new CRJ-705 aircraft per month for a total of 15 by December 2005. The CRJ-705 aircraft is configured in two classes of service with 10 seats in Executive Class featuring three abreast seating offering 37 inches of legroom, and 65 seats in Hospitality with four
abreast seating offering an industry leading 34 inches of legroom. Both cabins feature all leather seating, and in-seat audio and personal television systems will be installed beginning in the fall of 2005. The Bombardier CRJ-705 aircraft has a cruising speed of 880 km/h and a range of more than 3,500 km with a total payload of 7,778 kg including a cargo payload of 700 kg.

From Calgary, Air Canada offers 671 scheduled flights each week to 5 cities throughout Alberta, and 18 destinations across Canada, the USA, Caribbean and Europe.

Air Canada routes blow to WestJet: Calgary-Las Vegas added
'Trumps WestJet' and is 'just the beginning': analyst
Chris Sorensen
3 June 2005
National Post

After a short breather following the collapse of Jetsgo Corp., the competition for Canada's skies is once again heating up as Canada's three largest carriers -- Air Canada, WestJet Airlines Ltd. and CanJet Airlines -- attempt to outmanoeuvre each other on domestic and transborder routes.

Air Canada said yesterday the arrival of new regional jets has allowed it to launch several new city pairs, including Calgary-Las Vegas and Vancouver-Las Vegas.

The routes will be served by an Airbus A319 aircraft, which was previously used to fly between Houston and Calgary before it was replaced this week by a new 75-seat Bombardier CRJ-705 flown by Air Canada's regional carrier Jazz.

"This trumps WestJet," said Rick Erickson, an independent Calgary-based analyst, who said the Calgary-based low-cost carrier had been eyeing the gambling Mecca for its portfolio of leisure destinations in the United States.

"More importantly, this is just the beginning," Mr. Erickson said, referring to the anticipated delivery of between 45 and 90 new regional jets from Bombardier and Embraer over the next several years. "Does this spell trouble for WestJet? I'm sorry to say, but I think it does."

Mr. Erickson added that Air Canada's move to enter Las Vegas could also be tied to parent company ACE Aviation Holdings Inc.'s recent decision to invest US$75-million in the merger of US Airways Inc. and America West Airlines. In addition to giving Air Canada Technical Services a line on $1.5-billion worth of outsourced maintenance work, the 7% equity state is being touted as a way for Air Canada to increase its presence in U.S. markets by gaining better access to gates at key U.S. airports.

Air Canada also said yesterday it will use existing regional jets and turbo-prop aircraft to add new non-stop flights on domestic routes. They include Edmonton-Regina, Edmonton-Saskatoon, Hamilton-Montreal and Hamilton-Ottawa.

"Air Canada is now able to implement significant network improvements that will benefit consumers with more point-to-point, non-stop flights and enhanced schedules," said Ben Smith, Air Canada's vice-president of network planning, in a statement.

Karl Moore, a business professor at McGill University, said Air Canada's new approach to the domestic market, using smaller aircraft to offer more non-stop service between more cities, promises to create headaches for WestJet, which is limited to flying busier routes using its larger Boeing 737 aircraft. "What they are doing is providing opportunities in these cities that will take some of WestJet's customers away."

However, Clive Beddoe, WestJet chief executive, said he is not overly worried about competition from Air Canada or Jazz, telling attendees at an industry conference hosted by Insight Information yesterday that he expects the country's largest airline to suffer from rising costs. Nor does he see Nova Scotia-based CanJet as much of a threat, despite the fact that CanJet recently began operating flights in Western Canada, WestJet's backyard.

Mr. Beddoe said WestJet plans to continue adding transborder flights to its network and has recently renewed a deal worth $300-million to continue flying sun-seekers for charter tour operator Transat A.T. Inc.

He also poured cold water on Air Canada's decision to invest in the U.S. airline market. "I think it's going to be very interesting to see how the US Airways-America West thing works out," Mr. Beddoe said. "I would suggest it's going to be a negative for America West and could end up damaging it."

Air Canada to introduce new non-stop routes
Brent Jang
03 June 2005
The Globe and Mail

Air Canada plans to introduce new non-stop routes this year. Starting Aug. 1, Air Canada's regional Jazz airline will provide Edmonton-Regina and Edmonton-Saskatoon service. On Sept. 18, Jazz will launch Hamilton-Montreal and Hamilton-Ottawa routes, and on Oct. 30, Air Canada's mainline will begin Vancouver-Las Vegas, Calgary-Las Vegas and Montreal-Las Vegas flights. Air Canada is also launching non-stop service Nov. 3 to Santo Domingo from Toronto.

Air Canada Jazz hints at going public
BRENT JANG
4 June 2005
The Globe and Mail

TORONTO -- Air Canada's regional Jazz airline is sprucing itself up for the possibility that it could become a publicly traded company, Jazz president Joseph Randell said yesterday.

ACE Aviation Holdings Inc., the parent of Air Canada and Jazz, plans to sell trust units in its Aeroplan loyalty program by the end of this month. One of the other spinoff candidates is Jazz.

Mr. Randell emphasized that, unlike Aeroplan, ACE hasn't decided yet on whether to sell a minority stake in Halifax-based Jazz to investors, and even if it does sell, the timing is unclear.

“It's going to be driven by many factors, by things like market conditions, and the ACE board obviously would ultimately make decisions,” he said.

In the meantime, Jazz is increasingly operating at arm's-length from Air Canada, including charging Air Canada an hourly flying rate under a so-called capacity purchase agreement.

Jazz had $213-million in sales in the first three months of this year, or about one-tenth of ACE's total revenue in the quarter. And Jazz had $27-million in operating profit in the first quarter, compared with ACE's $77-million loss.

Steve Garmaise, an analyst with Genuity Capital Markets, said that, after ACE converts Aeroplan into an income trust, the spotlight will shift.

Air Canada Technical Services, which does aircraft maintenance, Jazz and Air Canada Vacations are among the entities where ACE is seeking to unlock hidden value, he said.

Mr. Randell said Jazz's passenger capacity is expected to rise 35 per cent this year.

“We're in a very strong position in terms of our growth, our fleet, our results. Jazz is a healthy regional airline,” he said after a presentation to delegates at a Toronto airline conference organized by Insight Information Co.

Jazz's fleet is expected to grow to 126 Dash-8s and Bombardier CRJs by the end of this year, from 91 aircraft at the end of 2004.

Air Canada and Jazz emerged from 18 months of bankruptcy protection last September.

“We do feel reborn,” Mr. Randell said.

But the transformation into an efficient regional airline has been a painful one, including job and wage cuts. Jazz now employs 3,400 workers, compared with about 5,500 before the filing for court protection from creditors.

Meanwhile, Halifax-based CanJet Airlines expects its fleet to grow to 17 aircraft in 2007 from 11 this year, said Ken Rowe, chief executive officer of IMP Group International Inc., CanJet's parent.

He said CanJet, which leases Boeing aircraft, is considering other models, such as Bombardier, Embraer and Airbus aircraft, as it expands. Edmonton and Winnipeg may be added as destinations within a year.

Air Canada ranked best in North America
4 June 2005
The Globe and Mail

Air Canada has been ranked as North America's best airline in a worldwide survey of more than 12 million air travellers. The Star Alliance, of which Air Canada is a founding member, was ranked as best airline alliance.

The annual survey of air travellers was conducted by U.K.-based research firm Skytrax between June, 2004, and May, 2005, using 35 different aspects of passenger satisfaction for each airline's product and service standards.

JetBlue Airways and Continental were ranked second and third, respectively, in North America. British Airways was picked top airline in Europe. Ranked as the top five airlines in the world overall were Cathay Pacific, Qantas Airways, Emirates, Singapore Airlines and British Airways.

For more information, visit www.airlinequality.com .

Air Canada, WestJet fly fuller planes in May

TORONTO, June 7 (Reuters) - Canada's top two airlines flew fuller planes in May, as the air travel market rebounded and the two carriers benefited from the failure of a competitor.

Air Canada, the operating arm of ACE Aviation and the country's dominant airline, said its passenger load factor -- a measure of how successfully it filled seats -- was 79.9 percent, its highest ever for May, compared to 78.5 percent in the same month last year.

Calgary, Alberta-based no-frills WestJet Airlines Ltd. said its load factor for May was 70.6 percent compared with 65.1 percent in May last year.

Both airlines are adding new jets to their fleets to replace older aircraft and boost capacity as they continue to benefit after privately held, no-frills competitor Jetsgo filed for bankruptcy earlier this year.

World Airways To Expand Cargo Service Between China and North America for Air Canada
7 June 2005

PEACHTREE CITY, Ga., June 7 /PRNewswire-FirstCall/ -- World Airways, a wholly owned subsidiary of World Air Holdings, Inc. , has reached agreement for a multi-year ACMI wet-lease contract with Air Canada to operate an additional MD-11F freighter aircraft for international cargo service, subject to Air Canada board approval. Under the agreement, World would operate two MD-11F aircraft for Air Canada through August 2007 between Toronto, Canada; China and points in North America. The amended contract has an estimated value of $101 million. World launched service with the first aircraft in May 2005, and the second begins in June.

"We welcome the opportunity to expand our new partnership with Air Canada to support their growing cargo operation," said Rob Binns, World's senior vice president, marketing and planning. "We will operate five flights a week between Toronto and Shanghai, with intermediate service to Calgary on four of those flights."

"In view of strong customer response to our recently introduced Toronto- Shanghai all-cargo service, we are excited with the prospect of expanding dedicated freighter services to Shanghai from our main Toronto hub," said Claude Morin, vice president, Air Canada International Cargo Division. "The Calgary-Shanghai link is also a priority as we look to improve access from Alberta to the rapidly expanding Chinese market."

The additional aircraft became available because of a delay in previously announced new service by Thai Air Cargo. With this expanded Air Canada agreement, World's five MD-11 freighters will be leased into 2007.

World Airways, a wholly owned subsidiary of World Air Holdings, Inc., is a U.S.-certificated air carrier providing customized transportation services for major international cargo and passenger carriers, the United States military, and international leisure tour operators. Founded in 1948, World operates a fleet of 17 wide-body aircraft to meet the specialized needs of its customers. For information, visit http://www.worldairways.com/ .

"Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995: This release contains forward looking statements that are subject to risks and uncertainties including, but not limited to, the impact of competition in the market for air transportation services, the cyclical nature of the air carrier business, reliance on key marketing relationships, fluctuations in operating results and other risks detailed from time to time in the company's periodic reports filed with the SEC (reports are available from the company upon request). These various risks and uncertainties may cause the company's actual results to differ materially from those expressed in any of the forward looking statements made by, or on behalf of the company in this release.

Air Canada's $6B Boeing 777-787 order up in air as pilots negotiate: Milton
June 8, 2005

TORONTO (CP) - Air Canada may cancel a $6-billion-US order for 32 new Boeing long-range airliners if it doesn't reach an agreement with its pilots by Friday, airline chief Robert Milton has disclosed.

The purchase of 18 Boeing 777s and 14 of the new 787 Dreamliners was described as firm, although subject to "several conditions," when it was announced April 25.

Milton, chairman and chief executive officer of parent company ACE Aviation Holdings Inc., told a transport industry conference in New York on Wednesday morning: "I would highlight that we're actually in the final stages of negotiating with our pilot group the terms of the contract by which they'll fly these aircraft. We do have the ability, if we cannot reach an agreement by the 10th of June, to without penalty cancel these orders."

He added: "I think Boeing would be quite happy to take them and put them somewhere else if we can't figure it out. It is my hope, obviously, that we get it done. If we don't, we'll have to revert to Plan B - which would be adding more used aircraft."

The president of the Air Canada Pilots Association, Kent Wilson, said negotiations "are still going on, and when we have news I'll be able to comment more on it."

Wilson noted that whenever new aircraft are added to the fleet, there are talks over pay, training and other issues. The June 10 date, he added, is between Air Canada and Boeing.

Milton said the airline regards the new Boeing planes as "a game-changer going forward" as it expands on long international routes, particularly to Asia.

A spokesman for Boeing said the aircraft maker wouldn't comment on an "ongoing negotiation."

However, Boeing officials issued a glowing forecast Wednesday for the airliner industry, predicting the market will be worth $2.1 trillion US in the next 20 years as the global airline fleet more than doubles. That projection is an increase of $100 billion from the company's forecast last year.

Boeing projects demand for 25,700 new commercial passenger and freighter planes during the next 20 years, up from the 25,000 it predicted a year ago.

When the deal with Air Canada was announced, ACE (TSX:ACE.B - news) said that including options the order could expand to $15.9 billion US, totalling 36 Boeing 777s and 60 Dreamliners - a new model scheduled to be delivered in 2010.

Coincidentally, a media event in Montreal to show off a 777 en route to the Paris Air Show was postponed hours before it was to have taken place Wednesday. Air Canada cited a procedural delay related to maiden-flight approvals needed from the U.S. Transportation Security Administration.

Milton also told the webcast conference that "Wal-Mart pricing is permanently here" in the travel industry and Air Canada is reacting by morphing from a "legacy airline" to a "loyalty airline."

Its strategy is to provide "commodity pricing at the low end," while bulking up yields by charging more for scheduling flexibility and full frequent-flyer points.

"We are always competitive with our low-cost competitors," Milton declared. "Day in, day out, flight for flight, they know there is nowhere to go in terms of dropping prices that we won't match them."

Milton said Air Canada and its Jazz regional unit have been "pleasantly surprised" by how much they have gained from the domestic market share held by Jetsgo before that discount airline collapsed in March.

And he said Air Canada has benefited on international routes - while U.S. airlines have been hurt - because of the American government's stringent security requirements.

"People just find it too much of a hassle to change planes in the U.S."

Aeroplan units to be priced at $10
ACE expects up to $287.5 million Will keep 85 per cent of business
Bloomberg News
9 June 2005

ACE Aviation Holdings Inc., owner of Air Canada, expects to raise as much as $287.5 million from the planned sale of a 15 per cent stake in the Aeroplan customer-rewards program.

ACE will sell 25 million units for $10 each in an initial public offering of Aeroplan Income Fund partnership units and keep the rest of Aeroplan LP, according to sale documents. Banks arranging the transaction have the option to sell another 15 per cent after the arrangement closes, on or about June 29.

Under decisions to be finalized June 21, the units will make monthly payouts equal to 7.5 per cent to 8.5 per cent a year, valuing Aeroplan at $1.65 billion to $1.87 billion, the documents said.

The deal would be the biggest income-trust IPO since January, according to CIBC World Markets.

"It'll be reasonably well-received," said UBS Securities analyst Fadi Chamoun, who valued Aeroplan at $1.5 billion in May.

"The underlying cash flow is relatively stable, with declining reliance on the airline business," added Toronto-based Chamoun, who rates ACE "buy 2."

Aeroplan has about 5 million members, who can redeem points for products and services from 60 companies.

Those firms include Air Canada, Best Buy Co.'s Future Shop and Imperial Oil Ltd.'s Esso gas stations.

Aeroplan gets revenue from selling points to companies, which then issue the points to consumers as rewards for making purchases.

Aeroplan generated "adjusted" earnings before interest, taxes, depreciation and amortization of $131.9 million in the 12-month period ended March 31, the documents said. The unit has a $100 million bank loan to help finance acquisitions, the documents said.

Aeroplan had profit of $21 million on revenue of $172 million in the first quarter, when ACE had a net loss of $77 million. Last year, Aeroplan had profit of $99 million on sales of $509 million, making the business ACE's most profitable unit.

Income trusts avoid taxes by paying most of their cash flow to investors.

RBC Capital Markets is leading the sale along with 14 other banks, including CIBC World Markets Inc. and Genuity Capital Markets.

Air Canada reaches pact with pilots on new Boeings

MONTREAL, June 9 (Reuters) - Air Canada said on Thursday that it reached a tentative agreement with its pilots on contract terms related to the airline's $6 billion purchase of 32 wide-body jets from Boeing Co. .

Air Canada, which is owned by ACE Aviation Holdings Inc. , said the agreement is subject to ratification by the Air Canada Pilots Association's membership.

The airline said Boeing had extended a June 10 deadline to June 19, when a positive vote by pilots would allow the aircraft order to go forward.

The purchase agreement, which analysts say will likely cost Air Canada less than the $6 billion list price, includes firm orders for 18 Boeing 777s, including the Worldliner, which is touted as the world's longest range jet, and 14 of the new Boeing 787 Dreamliners.

Deliveries of the 777s to Air Canada are due to begin next year, and the Dreamliners will start to arrive in 2010.

ACE Aviation class B shares were up 65 Canadian cents or 1.6 percent at C$41 on the Toronto Stock Exchange on Thursday, a new high for the stock.

The stock has almost doubled since early October when Air Canada, the country's largest airline, emerged from 18 months of bankruptcy protection with a much reduced work force and debt burden and lower operating costs.

($1=$1.25 Canadian)

ACE could pass future rewards to shareholders
May receive units or shares in spinoffs in the form of dividends, Milton says
BRENT JANG
9 June 2005
The Globe and Mail

Air Canada's parent company is considering spreading the wealth to shareholders by handing out trust units or common shares in its subsidiaries once they are spun off as separate entities, airline chairman Robert Milton said yesterday.

While ACE Aviation Holdings Inc. is now marketing Aeroplan trust units to investors in general, future spinoffs could be focused on ACE declaring dividends in the form of units or shares in various divisions to ACE shareholders.

As long as ACE remains financially strong, the dividend option geared toward ACE shareholders will be viable. The Montreal-based holding company had more than $1.8-billion in cash on its balance sheet at the end of the first quarter.

“We would like to maintain about $2-billion of cash. To the extent that cash goes over that as we move to monetize these various units, I would definitely be of the view that we look to share this wealth with our shareholders,” Mr. Milton said at a New York transportation conference sponsored by Merrill Lynch & Co. Inc.

“Without any commitment, I think it is realistic to envisage us on some basis dividending off parts of these companies potentially to shareholders,” he said.

Investors welcomed Mr. Milton's comments as ACE's class B voting shares for Canadians rose 50 cents to a record-high close of $40.35 yesterday on the Toronto Stock Exchange.

ACE's first spinoff is its Aeroplan loyalty program. Other ACE subsidiaries that could become publicly traded include the Jazz regional airline, Air Canada Technical Services, Air Canada Vacations, and cargo and ground-handling divisions.

The technical services unit, which does aircraft maintenance, is being touted by some industry observers as the next logical spinoff.

As for the pending Aeroplan conversion into an income trust, the issue will be available to investors by June 29 at $10 a unit in an initial public offering that could raise $287.5-million, including an overallotment option, said a “confidential information memorandum” circulated to brokers. The trust is forecast to have a yield of between 7.5 per cent and 8.5 per cent.

Aeroplan began its road show in Calgary yesterday, which will be followed by presentations today in Vancouver, tomorrow in Toronto and next Thursday in Montreal.

ACE will retain about 82 per cent of the customer loyalty program after the IPO, which could be for roughly 28.75 million units. In total, Aeroplan's value as an income trust could be between $1.65-billion and $1.87-billion, subject to details being finalized by June 21, when the number of units to be issued will be set, according to the memo.

Montreal-based Air Canada, which emerged from bankruptcy protection last September, is operating in a competitive industry, Mr. Milton said.

The combative ACE chairman warned yesterday that he's willing to cancel a $6-billion (U.S.) order for 32 new wide-body Boeing 777s and 787s if the Air Canada Pilots Association fails to agree to a deal on wages and other conditions.

“I would highlight that we're actually in the final stages of negotiating with our pilot group the terms of the contract by which they'll fly these aircraft,” said Mr. Milton, who is seeking to resolve the impasse with pilots by tomorrow. “It is my hope, obviously, that we get it done. If we don't, we'll have to revert to Plan B, which would be adding more used aircraft.”

After issuing the dire warning, Mr. Milton said Air Canada wishes to stick with the Boeing order, especially since he views the 787 model in particular as a “game changer” on international routes.

Captain Kent Wilson, president of the 3,000-member Air Canada Pilots Association, said he's aware that Air Canada could cancel its Boeing contract without penalty.

“I'm a pilot. I never push the panic button,” he said. “Negotiations are ongoing, and we're staying focused and optimistic.”

Air Canada reaches deal with pilots: Announcement comes as 777 stops in Montreal
Nicolas Van Praet
10 June 2005
National Post

MONTREAL - Air Canada has struck a labour deal with its pilots that clears the major hurdle to the airline's US$6-billion jet order with Boeing, one of the biggest airliner purchases in the world this year.

The Montreal carrier said it reached a tentative agreement yesterday morning with union leaders representing 3,000 mainline Air Canada pilots. The agreement sets out the pay and work rules for pilots who will fly the 32 new wide-body planes the airline is buying from Boeing.

The deal came one day after Robert Milton, chief executive of Air Canada parent Ace Aviation Holdings Inc., warned he could cancel the order for the airliners if the Air Canada Pilots Association and the company failed to agree on a contract governing wages and other work conditions.

Many industry players never believed the order was in jeopardy, describing eleventh-hour comments by both Mr. Milton and union officials as bargaining tactics.

"This is a major step forward," Montie Brewer, Air Canada's chief executive officer, told reporters gathered at an event marking the first world stop of the new Boeing 777-200LR.

"[It's] the first time we've been able to come to an agreement with our labour unions on the operating costs of an aircraft prior to its being delivered."

Asked later why Air Canada now feels it necessary to secure such labour deals before taking delivery of planes when it has never done so in the past, Mr. Brewer said the airline needs to get greater certainty on costs as far ahead as possible.

"It's a very volatile industry," he said. "We're rethinking everything we do."

The terms of the agreement with the pilots were not disclosed, although Mr. Brewer said pilots of the new planes will be the highest paid of all cabin crew. Union leaders will ask the pilots to ratify the deal by June 19.

Boeing and Air Canada had a deal by which the airline could cancel the order by June 10 without penalty if it failed to strike a pact with the pilots. Boeing has now given Air Canada an extension to allow union members to hold a vote on the contract.

Airlines typically renegotiate certain aspects of labour contracts with pilots when they bring new planes into their fleets. In this case, pay rates are based on a formula that measures the aircraft's size, speed, weight and revenue potential.

Air Canada announced April 25 that it would place firm orders for 18 Boeing 777 jets as well as 14 Boeing 787 dreamliners, and take purchase rights and options for another 64 planes. The firm orders are valued at about US$6-billion at list prices.

It was Air Canada's first order for Boeing since 1989. The airline said the planes will generate major savings on maintenance and fuel while allowing it to penetrate more markets.

General Electric will provide the engines for the 777. Mr. Brewer said a decision on the 787 engines, a contest between GE and Rolls Royce, will be made soon.

Air Canada and ACPA reach agreement on outstanding issues relating to new wide-body aircraft
9 June 2005


Air Canada has reached a tentative agreement with the Air Canada Pilots Association (ACPA) on costs and other related issues relating to the introduction of the new Boeing wide- body aircraft in the airline's fleet. The agreement with ACPA is subject to ratification by the union membership.

Air Canada's aircraft purchase agreement with Boeing announced April 25 is subject to the successful completion of certain conditions by June 10, 2005, including the negotiation of satisfactory terms by the airline with its pilots on costs and other related issues. The airline has received from Boeing an extension of the June 10 deadline to allow sufficient time for the ratification process to take place. Pending pilot ratification by June 19, the agreement is expected to be finalized allowing the aircraft order to go forward.

The purchase agreement with Boeing includes firm orders for 18 Boeing 777s, plus purchase rights for 18 more, in a yet-to-be-determined mix of the 777 family's newest models: the 777-300ER, the 777-200LR Worldliner, and the newly announced 777 Freighter.

Air Canada's 777 deliveries are scheduled to begin next year with the arrival of three 777-300ERs in 2006. The renewal plan also includes firm orders for 14 ultra-efficient new Boeing 787 Dreamliners, scheduled for delivery min 2010.

Aeroplan underwriters seek larger IPO
Brokers ask Air Canada to hike the supply of trust's units to meet surging demand
BRENT JANG AND ANDREW WILLIS
13 June 2005
The Globe and Mail

TORONTO -- Demand for Aeroplan Income Fund is sizzling hot, prompting the fledgling trust's underwriters to push Air Canada's parent company to consider nearly doubling the size of the initial public offering.

The underwriters are pressing ACE Aviation Holdings Inc. to issue more than $500-million worth of Aeroplan units, or almost a 30-per-cent stake in the popular loyalty program. That compares with the current plan to raise $287.5-million, consisting of $250-million in the IPO and another $37.5-million through a so-called overallotment option.

The underwriters and retail brokers are reporting that the issue is already vastly oversubscribed.

Air Canada spokeswoman Laura Cooke said it would be inappropriate to respond while the trust is still being marketed. “We are in a quiet period, and therefore we have no comment,” she said.

Aeroplan Income Fund will be issued at $10 a unit, with the number of units in the IPO to be determined early next week.

Industry sources say the yield will likely be between 7.5 per cent and 8 per cent, and not 8.5 per cent — the higher end of the forecasted range.

“The order book is already four times oversubscribed, and we've barely begun marketing,” said one investment banker working with the Montreal-based airline.

However, he said no final decision on the size or pricing of the public offering will be made until June 20.

Several bankers said Aeroplan is attracting both retail and institutional investors, reflecting an increased following for trusts among pension funds and other big money managers that traditionally have been less interested in the sector.

They say it's unusual to have an order book build up this early in an IPO, since many major investors wait until the last minute before buying, for fear of tipping their hands to the dealers and driving up the price of a new issue.

Brokers filing out of a Toronto presentation by Aeroplan executives and underwriters on Friday afternoon said investors are clamouring to buy units in ACE's customer loyalty division.

The brokers asked not to be named because their firms are also members of the underwriting syndicate. One of those brokers said he has requested $500,000 worth of Aeroplan units to sell to clients at his branch, knowing that he will be fortunate to get one-quarter to half of that amount, although he could sell the full $500,000. Several of his clients each want to purchase 1,000 trust units worth $10,000. A colleague has asked for $1-million worth of units to distribute.

At a yield of 7.5 per cent, the total value of Aeroplan Income Fund would be $1.87-billion. A 30-per-cent slice would amount to roughly $560-million, based on that total.

Harry Levant, an independent financial analyst, said numerous brokers who subscribe to his income trust newsletter are buzzing about robust demand for Aeroplan.

Mr. Levant said the pleasant dilemma for ACE will be whether to pounce in June and issue 50 million units while the market is hot or issue 28.75 million units in the first phase and then wait until the fall for a second selloff.

The benefit of waiting is that investors will then get a chance to digest more data, including what are expected to be healthy second and third quarters for ACE, further enhancing Aeroplan's appeal.

The drawback is that there's no guarantee that the trust market will be as strong in the fall as it is now, Mr. Levant said.

RBC Dominion Securities Inc. is leading the underwriting syndicate with CIBC World Markets Inc. and Genuity Capital Markets.

Another investment banker working with ACE said Aeroplan's dynamics are similar to that of the IPO for Yellow Pages Income Fund, which went public two years ago. “We started off Yellow Pages at $600-million, which seemed a lot at the launch, then ended up taking it to $1-billion on the back of surging demand,” he said.

Brokers attending Friday's Aeroplan road show at a downtown Toronto hotel received bright orange information packages, the same colour as Aeroplan's logo. The packages included the preliminary prospectus and a “confidential information memorandum” that provided an overview of the frequent-flier program.

Canadian Imperial Bank of Commerce, which markets the CIBC Aerogold Visa credit card, accounts for 55 per cent of Aeroplan's revenue, the prospectus said.

CIBC and other financial institutions chip in 63 per cent of revenue while Air Canada contributes 27 per cent and other business partners account for the remaining 10 per cent, the document said.

Based on preliminary data, there could be $70-million in cash available for distribution in the second half of this year to unitholders.

http://c1dsp.westjet.com/guest/images/left_img.gif

WestJet was founded in 1996 by four Calgary entrepreneurs led by Clive Beddoe, who saw an opportunity to provide low-fare air travel across western Canada. Through researching other successful airlines in North America - and in particular low-cost carriers from throughout the continent - the team followed the primary examples of Southwest Airlines and Morris Air and determined that a similar concept could be successful in western Canada.

Over the subsequent months, the team worked to develop a comprehensive business plan and financial model. With this information in hand, a number of local business people were approached and within 30 days the needed capital was raised. After purchasing the three original Boeing 737-200 aircraft, a second offering to retail and institutional investors was completed in January 1996, raising the necessary capital to commence operations.

On February 29, 1996, the airline started flight operations with 220 employees and three aircraft to the cities of Vancouver, Kelowna, Calgary, Edmonton, and Winnipeg. Since that time, the company has continued to expand, bringing more western cities into WestJet's world. In 1996, WestJet added Victoria, Regina and Saskatoon to its route network. In 1997, WestJet began service to Abbotsford/Fraser Valley, and in 1999 WestJet added Thunder Bay, Prince George, and Grande Prairie to its service area.

WestJet achieved a major milestone when in July 1999 it completed its Initial Public Offering of 2.5 million common shares. It was an exciting day for all WestJetters, representing the achievement of a key business goal and raising the necessary capital for expansion of the company into the coming years. With the help of lead underwriters CIBC World Markets and the dedicated executive team, WestJet has made a successful transition to a public company. The capital raised from the offering has been used for the purchase of additional aircraft, as well as the building of new Head Office and Hangar facilities in Calgary, in order to meet the needs of the company's expanding workforce.

1999 saw unprecedented change and restructuring in the airline industry in Canada, offering a window of opportunity for WestJet to expand its service beyond its current route structure. In December 1999, WestJet announced that it would be extending its successful low-fare airline across Canada. Between March and June 2000, the company added service to the eastern Canadian cities of Hamilton, Moncton, and Ottawa, creating an eastern network with Hamilton as the hub.

In 2000, WestJet's founders were honoured as 'The Ernst & Young Entrepreneur of the Year' for Canada, in recognition of the contributions they have made to Canadian travellers and the lives of all of WestJet's people and shareholders. In 2001, WestJet added new service to Fort McMurray, Comox, and limited addition flights to Brandon. In 2001, WestJet also added its first four Next-Generation Boeing 737-700 aircraft. Also, in 2001, the team of founders received an International Entrepreneurship award for Outstanding Teamwork.

In 2002, WestJet added service to two new Ontario destinations, London and Toronto. In February of 2002, the corporation successfully offered three million common shares yielding net proceeds of $78.9 million. The proceeds will fund aircraft additions, spare parts, and a third flight simulator. In 2002, WestJet was named one of Canada's top 100 employers.

In 2003, WestJet was named Canada's second most respected corporation in an annual survey conducted by Ipsos-Reid. The survey involved a randomly selected sample of 255 of the leading CEOs in Canada. Also in 2003, WestJet added service to the new markets of Halifax, Windsor, Montréal, St. John's, and Gander.

The airline operates a fleet of Boeing aircraft featuring new Next-Generation 737 aircraft with leather seats and more legroom. Transborder service commenced in the fall of 2004 to the cities of Los Angeles, San Francisco, Phoenix, Fort Lauderdale, Tampa, Orlando, and New York. Service to Palm Springs began in January 2005. WestJet is publicly traded on the Toronto Stock Exchange under the symbol WJA.

Website : http://www.westjet.com

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WestJet hopes booking system can streamline growth strategy: Add foreign partners
Chris Sorensen
14 June 2005
National Post

WestJet Airlines Ltd. will soon be in a position to increase traffic through partnerships with low-cost U.S. airlines and foreign international carriers following the adoption of a new, more universally compatible booking system.

Gillian Bentley, a spokeswoman for WestJet, said the company aims to implement a new computerized reservation system as early as the end of this year, making it easier for the Calgary-based carrier to enter marketing or customer-sharing agreements with other airlines.

Forging partnerships with other airlines could prove to be a crucial component of WestJet's future growth strategy as it runs out of new markets in Canada and faces tough competition from U.S. airlines and Air Canada on transborder routes.

"It will give us more opportunities," Ms. Bentley said yesterday, adding the new system is part of an overall effort to improve customer service.

"But there's no intention at the moment to do any interfacing [with other airlines] at this point."

WestJet's current "ticketless" reservation system is not necessarily compatible with systems used by other airlines, including low-cost carriers in the United States. Airline booking systems are complex software applications that enable airlines to adjust fares based on demand and availability of seats as well as a host of other variables such as competition and historical trends.

According to one analyst, the likely candidates to partner with WestJet once the new system is implemented are low-cost carriers in the United States such as JetBlue Airways and Southwest Airlines Co., or international carriers such as Cathay Pacific Airways, which last fall said it was in exploratory talks with WestJet.

Jennifer Pearson, a spokeswoman for Cathay Pacific in Canada, said yesterday the airline is still negotiating with WestJet as it looks for Canadian air carriers to feed traffic onto its TransPacific routes. She said the carrier has struck an agreement with Air Canada to provide some of the traffic and is also talking to Vancouver's Harmony Airways.

WestJet's move comes as rival ACE Aviation Ltd., the holding company for Air Canada, enters into a business relationship with US Airways and America West, which are hammering out the details of a merger that will pull US Airways out of its second round of Chapter 11 proceedings.

ACE Aviation said last month it would purchase a 7% equity stake in the newly-merged carrier in deal that promises to increase Air Canada's presence in select U.S. markets and drive traffic onto its international network via its Canadian hubs in Toronto and Vancouver. That's in addition to the traffic generated through Air Canada's membership in the Star Alliance, a global group of 16 airlines that have agreed to co-market their services and sell flights on each other's routes.

"If you look at the load factors that Air Canada enjoys today, a significant component comes from its Star Alliance partners," said David Newman, an analyst at National Bank Financial. "What WestJet needs to do is get this reservation system in place so they can communicate with the other reservation systems and co-ordinate more effectively."

There is also the possibility that WestJet could join the rival Oneworld Alliance, which includes American Airlines, Cathay Pacific and Lufthansa, but does not yet have a Canadian partner. However, Mr. Newman noted that WestJet has traditionally balked at the costs associated with global alliances and thus may be looking for a more "unique" arrangement. "It would seem to make sense to have a North American alliance of low-cost carriers," he said, noting WestJet, JetBlue and Southwest were among the few North American air carriers to show profits last year.

WestJet already has significant connections to Southwest, which served as a model for WestJet, and JetBlue, whose founder played a role in the Canadian carrier's start-up. More recently, WestJet purchased its live satellite television service from JetBlue, whose fleet of Airbus jets is also equipped with the seatback entertainment system.

Those bastards chopped the head off of Canada.

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I'm happy for WestJet. They have beautiful looking livery.

WestJet gains in business travel
More and more Canadian companies embracing discount airlines, survey says
BRENT JANG
15 June 2005
The Globe and Mail

Canadian companies are gradually embracing WestJet Airlines Ltd. as an alternative to Air Canada when booking business trips, underscoring a global trend of discount carriers gaining market share, a survey of corporate travel intentions has found.

The Association of Corporate Travel Executives surveyed 30 companies representing 27,000 employees in Canada and overseeing domestic air travel budgets totalling $100-million this year. Half of the companies said the lowest fare is their highest priority, while one-third picked convenience of schedule and service as the most important consideration. The study, conducted jointly with National Bank Financial, found that 83 per cent of the firms have not relaxed their policies to allow for more upgrades to business class on Air Canada.

“A budget-conscious mindset appears to have taken hold among Canadian companies,” National Bank Financial analyst David Newman wrote in a summary report. “While corporations are clearly taking steps to lower air travel costs, even as corporate profits improve, organizations have not gone so far as to take away frequent flier point privileges from their employees.” Air Canada offers Aeroplan miles to its frequent fliers while WestJet passengers can collect points with the rival Air Miles program.

Mr. Newman said companies have become more vigilant about their travel budgets because of “increased scrutiny on spending levels and corporate governance.”

Gone are the days when high-tech companies during the technology sector's boom six years ago wouldn't hesitate to send employees on trips in style. They paid premium prices for the flexibility of making changes without penalty, as well as the privilege of sitting on wider leather seats at the front of the plane with specialized service and extra legroom.

“In our view, corporations have permanently altered their approach to business travel, with far less tolerance and willingness to pay for upgrades or last-minute fares,” Mr. Newman said.

WestJet has narrowed the comfort gap by adding leather seats to its fleet of aircraft, as well as providing live satellite TV screens on the back of seats. Air Canada has been able to retain many cost-conscious business travellers by steering them toward Tango fares, its lowest category of ticket prices.

“Low-cost carriers are gradually being viewed as an alternative that is equal, if not superior, to the full-service carriers in meeting the needs of corporations and their travellers,” Mr. Newman said. He released a 24-page summary report about the travel survey along with a 132-page research study titled: Low-cost carriers leave legacy airlines in their vapour trails.

“Paying for a low-cost fare is one way business travellers can retaliate for previous gouging by these bloated behemoths,” he said.

However, Mr. Newman noted that Air Canada has staged a financial recovery and is still the dominant airline in Canada.

While legacy carriers have traditionally dominated the business market, low-cost airlines are now formidable rivals. Leading discount airlines in the world include WestJet, Dallas-based Southwest Airlines Co., Ryanair Holdings PLC of Ireland, JetBlue Airways Corp. of Kew Gardens, N.Y., and AirTran Holdings Inc. of Orlando, Fla.

WestJet converts options, buys 2 more Boeing planes

TORONTO, June 15 (Reuters) - WestJet Airlines said on Wednesday it will convert purchase options to buy two more Boeing aircraft, bringing to 11 the number of new Boeing planes Canada's No.2 airline will receive next year.

The no-frills airline said the two Boeing 737-600 aircraft will be delivered in August 2006. The airline has one more purchase option on a 737 plane for delivery in 2006.

WestJet also said it will defer purchase options for four more 737 aircraft from 2006 to 2007.

WestJet is adding new jets to its fleet to replace older aircraft and boost capacity as it benefits from the demise of competitor Jetsgo earlier this year.

($1=$1.26 Canadian)

Discount airlines WestJet, Canjet increasing B.C. flights
WestJet plans to include new flights from Vancouver to Phoenix, Palm Springs

Derrick Penner
Vancouver Sun

Thursday, June 16, 2005

Two of Canada's discount air carriers, WestJet Airlines and Halifax-based Canjet, are increasing their attention to the British Columbia market with new flights, the success of which should be helped by the departure of bankrupt Jetsgo from domestic airline wars.

WestJet Wednesday announced new flights to Phoenix and Palm Springs from Vancouver and Las Vegas from Kelowna in its fall schedule at the same time it said it will abandon Windsor as a domestic destination.

Shawn Durfy, WestJet's executive vice-president for marketing and sales, said the new destinations are part of what the airline sees as its logical expansion rather than a response to Jetsgo's demise.

However, "when you take an irrational player out of the market and allow [the] industry to recover and be healthy, it allows you to do these things."

"One of the things we couldn't do before was put a rational price in the market," Durfy added.

Durfy said the airline is adding Vancouver to Palm Springs and Phoenix flights to its roster based on its experience with Calgary flights to those destinations starting in 2004.

"We had tremendous success in [Palm Springs] out of Calgary last year," he added. "When we did the analysis of what we could do, from the facility and from marketing and sales, we felt that this would be a very successful route for us."

Durfy said Phoenix was added because it is a strong leisure destination and because it is increasingly important as a hub for business travel.

To grow, WestJet needs to do more than expand its flight offerings, it must also increase its partnerships with other airlines to feed passenger traffic, and "there is great connectivity into and out of Phoenix" to link with other airlines, Durfy said.

WestJet is in the process of acquiring a new reservation system, which it hopes to have in place by the end of the year. It should give the airline the flexibility "to do tremendous things" in forming such partnerships, Durfy said.

Marc-David Seidel, a transportation expert in the Sauder School of Business at the University of British Columbia, suspects WestJet also feels that it is important to be in the Phoenix and Las Vegas markets because of Air Canada's interest in the proposed merger of U.S. Airways and America West Airline.

Air Canada has said it would invest some $95 million in such a merger, from which it would gain maintenance contracts and feeder traffic for some of its international flights.

Seidel said Phoenix and Las Vegas are key markets for America West.

"This strikes me as an anticipatory strike just to get some penetration to America West's core markets," he added.

In the meantime, the fledgling Canjet is set to add Vancouver to its flight schedule starting June 27 as planned in the announcement it made last February.

Canjet spokesman Wayne Morrison said the company's master plan "since day one" has been to serve all of Canada's major centres, and Vancouver is a dense, attractive market where executives feel they can carve a niche as a competitive, low-cost carrier.

"We were always determined to be price competitive," Morrison added. "Some prices [in the market] were too crazy to compete with, so we let them go. But we'll be good solid competition with Westjet and Air Canada."

Air Canada has also increased its capacity following Jetsgo's bankruptcy, said airline spokeswoman Angela Mah, with the addition of one daily round trip from Vancouver to Toronto in the peak summer season.

She added that they've also increased frequencies to Calgary, Edmonton, Quebec City and Halifax as well, and in the fall will offer daily service from Vancouver to Las Vegas.

With files from Canadian Press

depenner@png.canwest.com

© The Vancouver Sun 2005

National Post
June 16, 2005
Air Canada Calgary cargo stop on hold: CargoJet files complaint
Chris Sorensen

Air Canada has been forced to shelve plans to include a Calgary stop on its new all-cargo service between Toronto and Shanghai because of a complaint to federal regulators by rival CargoJet, a spat that has the Calgary business community worried it will miss out on a lucrative economic link.

CargoJet Holdings Ltd., which has applied to begin flying to China but does not yet have the aircraft to make the trip, has complained to the Canadian Transportation Agency that Air Canada is unfairly leasing a U.S. aircraft and crews to fly the domestic Calgary-Toronto leg of the all-cargo service, which competes directly with CargoJet.

Air Canada, which has leased two MD-11 freighters and their crews from a U.S company until it receives its own Boeing freighters by the end of the decade, launched the Toronto-Shanghai route in mid-May, but later applied to regulators to amend its designation to include Calgary. The service was supposed to start on Monday.

Claude Morin, chief executive of Air Canada's cargo unit, said Air Canada may have to abandon the service, depending on Ottawa's ruling. However, he said Air Canada doesn't believe it is violating any rules and that CargoJet is likely upset that Air Canada recently decided to begin flying its own all-cargo aircraft between Calgary and Toronto, a multimillion-dollar contract previously given to CargoJet.

"CargoJet enjoys a nice Canadian monopoly between Toronto and Alberta," Mr. Morin said. "Which is why they are upset and don't want to give it up."

Air Canada Cargo, an operating unit of Air Canada's parent, ACE Aviation Holdings Inc., has moved to set up its own fleet of dedicated cargo aircraft to take advantage of an increasingly lucrative air freight market, particularly between Asia and North America.

Mr. Morin said Air Canada can still fly cargo between Toronto-Shanghai profitably without the Calgary stop, but added that, "financially, it would be better to stop in Calgary" since the majority of trade with China flows into North America and not the other way around.

CargoJet, however, charges that Air Canada is treading on the edge of Canada's air service agreement with the United States, which doesn't allow U.S. carriers to fly between two Canadian cities.

Ajay Virmani, CargoJet's CEO, said in an interview yesterday that Air Canada's decision to use a leased U.S. aircraft and crew threatens to open the door to other U.S. companies -- particularly couriers -- who would rather fly their own jets between Canadian cities instead of contracting the work to Canadian operators.

"What they are doing is displacing a Canadian carrier in favour of an American one," Mr. Virmani said.

He also accused Air Canada of trying to "scoop the cream" from the country's most profitable cargo routes. "Toronto-Shanghai -- I don't have a problem with that. But what they want to do is fly that aircraft between Toronto-Calgary and pick up all the good revenue and then come back from Shanghai to Toronto with all of that traffic."

Bill Clark, a Toronto aviation lawyer, said yesterday that he doesn't think CargoJet's complaint has any merit, although other industry insiders have questioned whether Air Canada's plans to lease the U.S. aircraft should have been put before the industry for comment.

Either way, the dispute has raised concern among Calgary's business community and the Calgary Airport Authority who see an important economic link to the world's most populous country hanging in the balance.

Murray Sigler, the president of the Calgary Chamber of Commerce, said the oil-rich province is eager for more air links to China because of the Asian country's rising energy demands.

The Calgary Airport Authority, meanwhile, is in the midst of a five-year plan to develop the airport as a Western Canadian cargo and logistics hub with links to the international community.

Stephan Poirier, the senior director of air cargo and logistics development at the airport, said the airport authority isn't taking a position on the issue, other than it would like to see a link to Asia created as soon as possible. "What is important to us is that Air Canada is ready to enter in to service right now, whereas CargoJet would need at least another 12 months," he said.

CAE Sells Two Full-flight Simulators, Flight Training Devices To Air Canada
16 June 2005

MONTREAL (Dow Jones)--CAE Inc. (CGT) has received a contract to provide Air Canada with two full-flight simulators for the new Embraer 170 and 190 aircraft, and a suite of CAE Simfinity training devices.

The contract is valued at about C$27 million, based on list prices.

In a news release, CAE said the contract represents its second and third full-flight simulator sales of fiscal 2006.

CAE said the Embraer 170 full-flight simulator is scheduled for installation at Air Canada's training facility in Toronto in the first quarter of 2006, while the Embraer 190 simulator will be ready for training in the third quarter of 2006. Both simulators will be equipped with CAE visual systems.

The CAE Simfinity training devices include two three-dimensional trainers (Integrated Procedures Trainers) and four desktop trainers (Virtual Simulators) for the Embraer 170 aircraft.

The company said the sale is part of a 10-year general terms agreement signed in 2001 with Air Canada to provide the carrier with full-flight simulators.

CAE provides simulation and modelling technologies for commercial and business aviation and defence customers.

Air Canada, owned by ACE Aviation Holdings Inc. (ACE.B.T), is Canada's largest air carrier.

so many articles!!!

Here are some photos to change the mood :

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More flight reports at : http://www.geocities.com/asiaglobe/gallery/flightreports.htm

Air Canada cancels 32-jet Boeing order

FROM ASSOCIATED PRESS

MONTREAL - Air Canada canceled an order for 32 widebody Boeing Co. jets after pilots rejected a contract deal that would have freed up funds for the new airplanes.

Pilots voted yesterday to reject terms that were tied to the aircraft order, which Air Canada announced April 25. The deal was worth about $6 billion at list prices, although airlines typically negotiate discounts, and was subject to employees accepting certain cost-cutting measures.

Montreal-based Air Canada emerged from bankruptcy protection last year.

"We cannot lose sight of the effort it took to get to where the airline is today," said Montie Brewer, Air Canada's president and CEO. "While the cancellation of this aircraft order will be disappointing to our employee group at large, including many of our pilots, it is the right decision given the circumstances."

The airline said it accepted the pilots' decision and notified Chicago-based Boeing the order was canceled.

Air Canada had placed firm orders for 18 new Boeing 777s next year and 14 Boeing 787 Dreamliners ? its newest jet ? which are scheduled for delivery in 2010. The airline also would have had purchase rights to 18 more 777s and 46 more 787s to replace Air Canada's Boeing 767 fleet.

In a statement posted on its website, Boeing said it was disappointed with the decision.

"We are seeing very strong demand for the 777 and the 787, and we believe we will have many opportunities to place these aircraft elsewhere," Boeing said.

When the aircraft deal was announced in April, Air Canada said it intended to dedicate the planes primarily to flights between Canada and various destinations in Asia, including Beijing, Shanghai and New Delhi.

Brewer said the company will look to the used market to find three 777s it needs for the planned Asian service.

"The critical component of the Boeing order were the 787 aircraft scheduled for delivery in 2010 and beyond to replace our Boeing 767 fleet," he said. "In time we will readdress this requirement."

Air Cda To Maintain Growth Plans After Jet Deal Nixed
By Monica Gutschi
20 June 2005

TORONTO (Dow Jones)--Air Canada's big plans to expand internationally aren't dead even if its deal to buy US$6 billion of new airplanes seemingly is.

The airline will plow ahead with its business plan using used wide-body aircraft for its overseas routes in the short-term, spokeswoman Laura Cooke said. "It's anticipated that the company will continue to grow on an unaltered basis," she said.

The airline cancelled an order for 32 wide-body aircraft from Boeing Co. (BA) on the weekend after its pilots' union rejected a tentative agreement on pay scales and working conditions to fly the new planes.

The aircraft were to have been used on Air Canada's rapidly expanding international network and were to replace the company's aging 737 fleet.

Air Canada, a unit of ACE Aviation Holdings (ACE.B.T), has already said it would purchase three used aircraft to replace the Boeing 777-300 aircraft that would have been delivered next year. The remainder of the new wide-body aircraft - primarily Boeing's new and popular 787 Dreamliner - were to have been delivered after 2010.

That, say most observers, gives Air Canada plenty of time to find alternatives.

They say the airline could scour the used plane market - although the number of parked aircraft is dwindling as global airline fortunes revive - or add to its wide-body Airbus (ABI.YY) fleet rather than phase them out.

Air Canada's fleet plan would have given it all-Boeing wide-body planes, all-Airbus narrow-body aircraft, and a group of Embraer (ERJ) regional jets. Its sister airline, regional operator Jazz, is to fly Bombardier Inc. (BBD.SV.B.T) regional jets and a mix of turboprops.

But many believe Air Canada hopes to revive the Boeing order.

"I don't think we've heard the end of this by any means," said independent airline analyst Rick Erickson. And another analyst said "I have got to believe that maybe there are some negotiations going on to see if they can work this out."



Order Cancellation Seen As Labor Bargaining Ploy


Many observers say the hugely symbolic order was cancelled as a negotiating ploy by the company, which has been plagued by union strife even before it wrung C$1.2 billion in concessions out of its 35,000 employees. The pilots' rejection of the deal - which had been recommended by the union leadership - was said to be related to an unresolved dispute over seniority rather than an unwillingness to accept the new planes.

"We suspect that this development is a tactic intended to force an agreement with the union and is likely to amount ultimately to a delay, rather than outright cancellation," Banc of America said in a morning note.

A spokesman for the pilots' union was not immediately available for comment.

In Toronto, ACE Aviation is down C$1.15 to C$41.25 on 237,000 shares amid a general downturn in transportation stocks as oil prices surged.

But even if Air Canada can revive the order, observers say it is unlikely to get the same "sweetheart deal" it got in April, when Boeing and Airbus were battling for market supremacy.

On announcing the order, ACE chairman Robert Milton said he was "confident that no one has ever done better on a deal. From a timing standpoint, a lot of things came together to work to our significant advantage." Analysts believe Air Canada paid far less than the US$6 billion list price on the planes. As well, given the recent popularity of the Dreamliner, Air Canada likely had fixed delivery slots that it may have lost forever.

"I'll bet you right now there are companies snapping up those delivery slots," Erickson said. And Banc of America noted that "given the robust health of the 787 order book (266 commitments) and order wins for the 777 at (the biannual air show in) Paris, we do not think that this represents a significant setback for Boeing."

However, Boeing remains in an uphill battle against its French rival, which observers say could make it willing to give Air Canada a bit of leeway. Boeing gained commitments for 146 new airplanes at the show, while Airbus received orders for 280 aircraft.

"Boeing is in a market-share race with Airbus and the last thing they want to do is lose an order," said another analyst. "I'm not sure this is over."

The new airplanes are 30% more cost-efficient than Air Canada's existing Boeing 767s, which would have helped the airline stem rising fuel costs, its second-largest expenditure after labor. Air Canada announced an increase in its fuel surcharge Monday as oil prices edged above US$59 a barrel.

The airline had said the fuel and maintenance savings alone would be double the additional costs of ownership. The new planes were also expected to be accretive to annual earnings as of 2006 and to boost the airline's profits by C$300 million a year after 2010.

"It's unfortunate that a pilots' squabble has really gotten in the way of what was in the best interests of the airline," Erickson said.

Air Canada increases domestic fares in response to fuel prices
20 June 2005


In response to record high fuel prices, Air Canada is adjusting fares to reflect the additional operating costs. The fare increase applies to all fare types including published, web and other special fares for travel on Air Canada, Air Canada Jazz and Air Canada codeshare flights within Canada.

Base fares for flights within Canada are being increased each way by CA$8 on short haul flights up to 300 miles (483 kms), CA$10 on medium haul flights between 301-1000 miles (484-1609 kms), and CA$15 on long haul flights over 1000 miles (1609 kms).

The increases come into effect on tickets issued beginning June 23, 2005 for all domestic Canada travel.

Used jets on Air Canada's shopping list

By BRENT JANG

Monday, June 20, 2005 Updated at 9:51 PM EDT

From Tuesday's Globe and Mail

Air Canada is shopping for five used, wide-body planes to tide it over until it decides how to bounce back from having to cancel a $6-billion (U.S.) order for new Boeing aircraft.

The airline also plans to spruce up aging Boeing 767s with new seats that will feature video-on-demand screens on the back of each seat, and power plug-ins for laptops and other devices, Air Canada president Montie Brewer said Monday in a memo to employees.

The fleet refurbishment program is focused on wide-body Boeing 767s, which are scheduled to be replaced over several years, starting in 2010. Although the interior facelift for the 767s has long been planned, Mr. Brewer said it takes on extra significance in the wake of the cancelled jet order. There are currently 45 Boeing 767s in the fleet, with an average age of 22 years.

“Special attention will be placed on the 767s in this program, which will begin at the end of this year and will ensure that the 767s and other fleets will remain competitive for years to come,” Mr. Brewer said.

He made the comments after Air Canada notified Chicago-based Boeing Co. on the weekend that it decided to scrap an order for 18 Boeing 777s and 14 Boeing 787 Dreamliners. Canada's flag carrier also had options to buy another 18 Boeing 777s and 46 Boeing 787s.

Montreal-based Air Canada will be short two wide-body planes next year and three more in the summer of 2007, but “I am confident we will be able to find ways to fill these gaps and continue to grow at planned rates,” Mr. Brewer said.

Three new Boeing 777s were scheduled for delivery next year, including one earmarked for the Vancouver-Tokyo route.

In April, Air Canada chairman Robert Milton touted the new fuel-efficient and roomier Boeing 777 and 787 jets as crucial to the carrier's future on international routes, notably to Asia and Latin America.

“The real value of the Boeing deal was the replacement of the 767s in 2010 with the 787s,” Mr. Brewer said. “Again, I am confident that we will in time find a way to address the 767 retirement issue and we have time.”

Air Canada had made its purchase contingent on the approval of its pilots' union for wages and working conditions on the new aircraft. The pilots are embroiled in an internal squabble over seniority, which determines who gets the better-paid jobs flying larger jets.

Members of the Air Canada Pilots Association who cast ballots rejected Air Canada's labour deal for flying the new Boeing aircraft, with more than 54 per cent voting down the tentative pact that had been endorsed by the union's negotiating team. One-third of the 3,000-member union did not vote.

Captain Kent Wilson, president of the pilots' union, said the voting results show that there remains a persistent problem with merged seniority lists for pilots, long after Air Canada's merger with Canadian Airlines International Ltd. in 2000.

The so-called Original Air Canada (OAC) group of pilots are upset that many of their Canadian Airlines counterparts moved ahead of them in seniority rankings.

“A No vote will provide the platform to explain how the Original Air Canada pilots have lost,” said a memo issued last week by three OAC pilots, who complained about “the devastating impact of our loss of seniority” and drop in wages.

Joseph D'Cruz, a professor at the University of Toronto's Rotman School of Management, said he expects Air Canada executives to go back to the drawing board and develop a new Boeing purchase plan that's palatable to cynical pilots.

“Eventually, they have to buy new aircraft,” he said. “Air Canada is looking at growth in point-to-point travel, so that could be Vancouver to Beijing. The Dreamliner is exactly right for that kind of traffic.”

Boeing spokesman Todd Blecher said from Seattle, home of final assembly operations, that the aircraft maker is disappointed at losing the original order for 32 jets. Mr. Blecher described the cancellation of such a large order as a rare occurrence. “We were surprised by the end result,” he said. “There are internal issues that Air Canada needs to deal with at this point.”

Air Canada parent ACE Aviation Holdings Inc. class B voting shares fell $1 (Canadian) to $41.40 Monday on the Toronto Stock Exchange.

Tough shopping for Air Canada
Airline analysts, consultants skeptical Used widebody jets hard to come by
Rick Westhead
Toronto Star
21 June 2005

Air Canada shouldn't expect to find bargains on second-hand planes after the union representing mainline Air Canada pilots voted to quash the carrier's plans to buy new state-of-the-art jets, airline analysts and consultants say.

Demand for widebody jets, typically used to fly routes from North America to Asia and other far-flung destinations, has never been stronger.

With jet manufacturers such as Boeing Co. and Airbus SA still several years away from delivering new models, airlines are gobbling up most of the fuel-efficient second-hand planes they can find.

"The market for passenger aircraft continues to strengthen," Morgan Stanley airline analyst Douglas Runte wrote Sunday in a report to clients. "There are almost no widebody aircraft such as the 767, 777 or A330 available."

In fact, of the 600 Boeing 767-300ER jets produced by the manufacturer, just four were "parked" and available for purchase on the second-hand market in March, Runte wrote. Boeing's 777 model and Airbus' A330 and A340 models are in similarly scant supply.

"Prices are rising and availability is tight," said David Treitel, an executive with New York airline consulting firm SH&E. "There's no easy solution for Air Canada here."

However, Air Canada spokesperson Laura Cooke said the airline remains confident on meeting its target of acquiring three widebody planes next year. Last year, Air Canada acquired six such second-hand planes, and the number available could rise dramatically if any carriers filed for bankruptcy or bankruptcy protection.

Air Canada had originally placed orders worth $6.1 billion (U.S.) for 18 Boeing 777s and 14 of the Chicago-based company's new 787, also known as the Dreamliner for such things as its spacious interior and large passenger windows. Air Canada also acquired the option to purchase 18 additional 777s and 46 more 787s.

Air Canada didn't reveal the cost for each airplane, but Boeing's 777-300ER has a list price of as much as $245.5 million. The 787 sells for $120 million.

Even with the steep price tags, Air Canada hoped the new planes would pare fuel costs by about $300 million within five years. Now, however, the company faces paying relatively steep prices for second-hand jets.

Treitel, whose company has been hired by airlines to buy used planes, said he recently considered a purchase for a group of used 767 jets that were built in the early 1990s and selling for at least $28 million apiece.

Even after the purchase, an airline would face the added cost of refitting the plane to adapt its avionics equipment and conform to the carrier's seating configurations. That alone could add another $15 million to the price, Treitel said.

In a memo to employees announcing the collapse of the Boeing deal, Air Canada executive vice-president Rob Reid noted that "the used aircraft market, especially for wide-bodies is extremely tight, but hopefully, over the course of the next year we will be able to find used A340, A330 and 767 aircraft, which will enable us to achieve the growth that was otherwise planned for 2006 with 777 deliveries.

"While, clearly, we don't feel that this is as attractive economically, especially with today's high fuel prices, we will work our way through it," Reid wrote. "Key for us will be the longer-term issue of replacing our 767 aircraft, but for now, we'll just leave that for another day."

Kent Wilson, president of the Air Canada Pilots Association, confirmed yesterday that the union's members voted 1,140 to 961 to scuttle the purchase, at least partly because of widespread rancour over how pilot seniority lists were merged when Air Canada bought Canadian International Airlines Ltd. five years ago.

Air Canada's pilots hurt their own cause
Editorial
21 June 2005
The Globe and Mail

As part of its strategy for financial revival and expansion on lucrative international routes, Air Canada was counting on updating its aging fleet with 32 new long-range Boeing jetliners. But the deal was scrapped on the weekend when the airline's pilots rejected changes in wages and working conditions to fly the planes. Air Canada probably made a strategic error by making the order contingent on a reworked labour agreement with a cranky work force, but the pilots made a bigger mistake by allowing old animosities to cloud their judgment.

More than 54 per cent voted against accepting the tentative deal endorsed by their own negotiators. About a third of the 3,000 members of the Air Canada Pilots Association didn't cast ballots, but a large group of disgruntled veterans calling themselves the Original Air Canada pilots managed to win enough support from those who did. “The goal is to redress and correct the inequities of the past four years,” three of the pilots declared in a memo before the balloting. “Vote No so we can rectify this travesty.”

The pilots' simmering anger stems from a loss of seniority after Air Canada's merger with Canadian Airlines International Ltd. in 2000. Many of their counterparts at Canadian moved ahead of the Air Canada pilots when the seniority lists were combined. For some Air Canada captains, that meant demotions and wage cuts. Then came Air Canada's financial collapse in 2003 and further hefty wage cuts and other concessions to help keep the airline afloat. Add in resentment over salaries and perks paid out to top executives in the restructured company and you have the recipe for a confrontation.

The problem is that this is the wrong battlefield. The aircraft deal would have outfitted Air Canada with 18 Boeing 777s and 14 787 Dreamliners, Boeing's next wide-bodied model. The Dreamliners were set for delivery in 2010, the date by which the airline has said it intends to begin phasing out its older long-haul fleet of Airbuses and Boeing 767s. The new planes are more comfortable, more fuel-efficient and cheaper to maintain, qualities that are important if Air Canada is to reduce its operating costs and attract more business on international routes. Thanks to fierce global competition between Boeing and Airbus, which was fighting to retain Air Canada as a customer of its wide-bodied jets, the Canadian airline also got a healthy discount off the $6-billion-plus (U.S.) price tag.

The airline would improve its bottom line with the more efficient fleet, and the pilots would have the chance to fly bigger, more sophisticated jetliners. As a rule of thumb, those steering the biggest planes in the fleet tend to receive the highest pay. That's undoubtedly why the airline gambled that the union would embrace the new deal. Instead, the pilots have cut off their nose to spite their face. The airline, meanwhile, will scour the used-jet market to meet its most urgent needs.

When Air Canada emerged from bankruptcy protection last fall, Mr. Justice James Farley of Ontario Superior Court warned management and employees that they must work together and ditch their “us-versus-them mentality.” Unfortunately, it seems not enough people were prepared to take his sound advice. The pilots, the airline and its customers are the losers for that.

Air Canada to Raise Ticket Prices as Fuel Costs Rise (Update2)

June 20 (Bloomberg) -- Air Canada, the country's biggest airline, will raise ticket prices starting June 23 to counter rising jet-fuel costs.

Fares for flights within Canada will rise by C$8 ($6.49) each way on flights of as many as 300 miles (483 kilometers), C$10 on flights between 301 and 1,000 miles and C$15 for flights of more than 1,000 miles, the Montreal-based unit of ACE Aviation Holdings Inc. said today in a statement.

Fuel is the second-largest operating expense for airlines behind labor, the company said in the statement. The spot price for jet fuel sold at New York Harbor touched $1.73 a gallon today, a 44 percent rise from the beginning of the year and just below a record $1.75 on April 1. Air Canada said first-quarter fuel costs rose 23 percent to C$415 million.

``We monitor fuel costs on a regular basis and will make fare adjustments as warranted,'' Angela Mah, a spokeswoman for the airline, said in a telephone interview.

Shares of ACE fell 92 cents, or 2.2 percent, to C$41.43 by 4 p.m. in trading on the Toronto Stock Exchange. They've risen 67 percent since the company emerged from an 18-month bankruptcy and the shares began trading Oct. 4.

Yesterday ACE said it plans to cancel a $6.1 billion plane order with Boeing Co. after Air Canada pilots rejected a contract to fly them. WestJet Airlines Ltd. of Calgary is Canada's second- biggest airline.

Air Canada is shopping for five used, wide-body planes to tide it over until it decides how to bounce back from having to cancel a $6-billion (U.S.) order for new Boeing aircraft.

The airline also plans to spruce up aging Boeing 767s with new seats that will feature video-on-demand screens on the back of each seat, and power plug-ins for laptops and other devices, Air Canada president Montie Brewer said Monday in a memo to employees.

The fleet refurbishment program is focused on wide-body Boeing 767s, which are scheduled to be replaced over several years, starting in 2010. Although the interior facelift for the 767s has long been planned, Mr. Brewer said it takes on extra significance in the wake of the cancelled jet order. There are currently 45 Boeing 767s in the fleet, with an average age of 22 years.

“Special attention will be placed on the 767s in this program, which will begin at the end of this year and will ensure that the 767s and other fleets will remain competitive for years to come,” Mr. Brewer said.

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He made the comments after Air Canada notified Chicago-based Boeing Co. on the weekend that it decided to scrap an order for 18 Boeing 777s and 14 Boeing 787 Dreamliners. Canada's flag carrier also had options to buy another 18 Boeing 777s and 46 Boeing 787s.

Montreal-based Air Canada will be short two wide-body planes next year and three more in the summer of 2007, but “I am confident we will be able to find ways to fill these gaps and continue to grow at planned rates,” Mr. Brewer said.

Three new Boeing 777s were scheduled for delivery next year, including one earmarked for the Vancouver-Tokyo route.

In April, Air Canada chairman Robert Milton touted the new fuel-efficient and roomier Boeing 777 and 787 jets as crucial to the carrier's future on international routes, notably to Asia and Latin America.

“The real value of the Boeing deal was the replacement of the 767s in 2010 with the 787s,” Mr. Brewer said. “Again, I am confident that we will in time find a way to address the 767 retirement issue and we have time.”

Air Canada had made its purchase contingent on the approval of its pilots' union for wages and working conditions on the new aircraft. The pilots are embroiled in an internal squabble over seniority, which determines who gets the better-paid jobs flying larger jets.

Members of the Air Canada Pilots Association who cast ballots rejected Air Canada's labour deal for flying the new Boeing aircraft, with more than 54 per cent voting down the tentative pact that had been endorsed by the union's negotiating team. One-third of the 3,000-member union did not vote.

Captain Kent Wilson, president of the pilots' union, said the voting results show that there remains a persistent problem with merged seniority lists for pilots, long after Air Canada's merger with Canadian Airlines International Ltd. in 2000.

The so-called Original Air Canada (OAC) group of pilots are upset that many of their Canadian Airlines counterparts moved ahead of them in seniority rankings.

“A No vote will provide the platform to explain how the Original Air Canada pilots have lost,” said a memo issued last week by three OAC pilots, who complained about “the devastating impact of our loss of seniority” and drop in wages.

Joseph D'Cruz, a professor at the University of Toronto's Rotman School of Management, said he expects Air Canada executives to go back to the drawing board and develop a new Boeing purchase plan that's palatable to cynical pilots.

“Eventually, they have to buy new aircraft,” he said. “Air Canada is looking at growth in point-to-point travel, so that could be Vancouver to Beijing. The Dreamliner is exactly right for that kind of traffic.”

Boeing spokesman Todd Blecher said from Seattle, home of final assembly operations, that the aircraft maker is disappointed at losing the original order for 32 jets. Mr. Blecher described the cancellation of such a large order as a rare occurrence. “We were surprised by the end result,” he said. “There are internal issues that Air Canada needs to deal with at this point.”

Air Canada parent ACE Aviation Holdings Inc. class B voting shares fell $1 (Canadian) to $41.40 Monday on the Toronto Stock Exchange.

Aeroplan set to bring in $250 million
Fund units priced to yield 7 per cent Underwriters have option to buy more
Canadian Press
23 June 2005

MONTREAL -- Air Canada's parent company plans to raise $250 million by selling a 12.5 per cent stake in the Aeroplan loyalty program at the end of June.

The issue as an income fund pegs the market value of profitable Aeroplan at $2 billion, well above the $1 billion to $1.5 billion analysts had earlier expected, and amounts to nearly half the market value of parent ACE Aviation Holdings Inc.

"We are extremely pleased to see the market valuing Aeroplan at $2 billion, making it one of Canada's largest business trusts and the first-ever monetization of an airline frequent-flyer program," ACE chairman and chief executive officer Robert Milton said in a statement.

ACE, which had previously announced it would partially spin off Aeroplan, will sell 25 million units of the Aeroplan Income Fund to a group of underwriters for $10 a unit, the company said yesterday.

ACE Aviation was created last year as part of Air Canada's restructuring. Underwriters have the option to buy up to 3.75 million additional units of the income fund, which appears likely to happen. The over-allotment option would bring the sale to $287.5 million, and leave ACE with 85.6 per cent of Aeroplan, down from the currently planned 87.5 per cent.

The units are expected to provide a yield of 7 per cent a year, based on the initial public offering price. ACE Aviation class B shares closed unchanged at $41.45 yesterday.

ACE Aviation will keep about $125 million of the proceeds, while Aeroplan will get $100 million to help fund a reserve for Aeroplan Mile redemptions and for capital expenditures, with the rest going for fees.

The holding company has other spinoffs planned, including the Jazz regional airline.

Air Canada files complaint
Rick Westhead
25 June 2005
The Toronto Star

In a move that could resurrect its acquisition of 32 new Boeing Co. jetliners, Air Canada has asked the Canada Industrial Relations Board to help settle a long simmering battle over pilot seniority that boiled over and helped to scuttle the airline's $6.1 billion plane purchase.

The carrier yesterday filed its complaint with the industrial relations board, asking for a final determination of the pilots' seniority issue. If the board rules in favour of the airline, it could force another vote.

A week ago, the 3,100 pilots who operate Air Canada's mainline fleet scuppered the carrier's purchase of the new long-range jets largely because they were upset over how the way pilot seniority lists were merged after Air Canada bought Canadian Airlines International Ltd. in 2000. Seniority is used to determine which pilots get coveted routes on larger planes and preferred vacation times. Air Canada has also asked the board to rule that the actions of some of its pilots constitute an illegal strike as they were encouraged to engage in activity such as sick-ins and refusing normal work assignments.

"The actions of the respondents are clearly illegal and interfere with the ability of Air Canada to operate its business in a normal way," Air Canada's complaint says. "Since Air Canada does not have the right or the power to change the seniority ruling, the board, through decision, mediation or otherwise must deal with finality with the seniority issue, so that future activities of the airline will not be harmed."

An Air Canada Pilots Association spokesperson couldn't be reached to comment.

Air Canada's planned purchase of the new planes, originally announced in April, could have been worth as much as $15.9 billion had the carrier exercised its options for more of the new fuel-efficient jets. The jet order was booked pending a vote by the pilots association to accept changes in working conditions.

After the pilots voted against the changes, effectively quashing the purchase plans, the airline said it would buy used aircraft.

The airline's 43-page complaint, which has been brought against eight Air Canada pilots and an airline splinter group known as "The Red Pilots for Seniority Justice" brought to light more details about lobbying efforts by disgruntled union members who quashed the Boeing purchase. "During the ratification vote, groups of pilots in the bargaining unit represented by ACPA known as the (Original Air Canada pilots) and the Red Pilots (red, of course, being the colour traditionally associated with pre-merger Air Canada, in contrast to Canadian's blue) urged a rejection of the agreement on the introduction of the B777 and B787."

Air Canada said the splinter group's goal was to "put economic pressure on Air Canada to illegally ignore" a decision made in 2003 by an arbitrator over how to merge the seniority lists of Air Canada and Canadian Airlines pilots. That decision was recently upheld in the Federal Court of Canada.

In a vote conducted by ACPA, 1,140 members voted against the agreement introducing the B777 and B787, while 961 voted in favour of it and 940 did not vote.

Air Canada braces for flight delays
Long-standing dispute with pilots over seniority may lead to job action
BRENT JANG
27 June 2005
The Globe and Mail

Air Canada is warning that a group of disgruntled pilots has threatened to delay flights as part of an escalating protest over seniority rankings.

Air Canada chief operating officer Rob Reid said in an internal letter to the company's 3,000 unionized pilots that he's concerned about job action by those belonging to the so-called Original Air Canada (OAC) group.

The pilots were hired by Air Canada before its merger with Canadian Airlines International Ltd. (CAI) in 2000.

“Several of our pilots have communicated to their co-workers and called for action to slow down the company's operations,” Mr. Reid wrote on the weekend. “We are all professionals and I know that the vast majority of you do not condone or support this activity. Whenever such activity happens by a few, we all suffer the consequences — company, pilots and fellow employees alike.”

The airline told the Canada Industrial Relations Board late Friday that OAC e-mails encourage pilots to engage in a number of work-to-rule tactics, including ignoring the phone when on call, temporarily resigning supervisory duties, showing “renewed vigilance” in following “professional standards of conduct,” and re-examining their health to see whether they're “fit to fly” or are suffering from “fatigue.”

Such tactics constitute an “illegal strike, with sick-ins and refusal of flights,” according to Air Canada, which emphasized that for now, operations have not been disrupted.

“These suggestions were made just before the start of a summer season which will be of greater than normal importance for Air Canada,” the airline told the labour board, which serves as a quasi-judicial tribunal.

The e-mails cited in the filing to the labour board date from mid-June. Air Canada attached e-mails sent by several OAC pilots who sought to use the seniority issue as a bargaining chip by recommending rejection this month of a proposed labour pact for flying new Boeing jets.

The tentative pact was rejected, forcing Air Canada to cancel its $6-billion (U.S.) order for 32 new wide-body planes from Boeing Inc. because the airline made its purchase contingent on pilots' approval of the labour deal.

Besides bickering among pilots, strained relations between management and unionized employees are evident in an e-mail from a group of OAC pilots that makes reference to Air Canada chairman Robert Milton: “You should also maintain a civil tone and resist any urges to refer to him as any part of your anatomy.”

Members of the Air Canada Pilots Association recently rejected a proposed labour contract that would have boosted many pilots into higher wage brackets and protected their breaks on sleeping bunks aboard new Boeing jets.

OAC pilots say they rejected the labour contract because they wanted to call attention to their anger over many ex-CAI pilots moving ahead of them in seniority rankings in 2003.

Air Canada is asking the labour board to halt actions that constitute an “illegal strike” by OAC pilots.

“This may look like a strong reaction. But keep in mind, permitting this type of illegal activity has negative consequences for all of us,” Mr. Reid said. “We have come through too much to let this set us back.”

In Air Canada's complaint filed Friday with the labour board, the carrier seeks an order to compel a new vote on the rejected contract, which covers wages and working conditions for flying new Boeing 777s and Boeing 787 Dreamliners.

Air Canada, pilots dismiss concerns over schedule
Seniority dispute: Operations won't be affected, airline says
Chris Sorensen
28 June 2005
National Post

Air Canada and members of a group of disgruntled pilots are downplaying fears that a long-standing dispute over pilot seniority issues will affect the airline's operations by delaying flights during the busy summer travel season.

Air Canada said yesterday that it has not experienced, nor does it expect, any flight delays because of labour action by a small group of pilots who are protesting against a federal labour board ruling concerning Air Canada's merger with the former Canadian Airlines in 2000.

"There's been no impact on our operations as a result of pilot-related activity," Laura Cooke, an Air Canada spokesman, said yesterday. She added that the airline is not advising travellers to expect delays.

"We expect that our pilots, because they are professionals, will conduct themselves in a professional manner."

The pilot group opposes the labour board ruling that merged the seniority lists of the two airlines, which some Air Canada pilots say favoured former Canadian Airlines pilots.

Echoing Air Canada's reassurances, three members of the disgruntled Original Air Canada Pilots said yesterday that they "will not, and have not contemplated, any action that would threaten either the safety or convenience of the travelling public."

As well, Glen Phillips, a representative of the OAC pilots, said yesterday that the group did not condone an e-mail sent by one pilot to about 65 others on June 9 that suggests they bog down Air Canada's operations by requesting extra safety checks or refusing to work extra hours, among other things.

Rob Reid, Air Canada's chief operating officer, responded to the threat of job action by sending a memo to Air Canada's 3,000 pilots last weekend, urging them not to take part in any action that would damage the company.

Pilot protest over the seniority question has been identified by the airline as the chief reason why members of the Air Canada Pilots Association earlier this month refused to ratify a negotiated deal over pay-rates and working conditions related to Air Canada's plans to purchase 32 modern, long-range aircraft from Boeing Co. The move forced Air Canada to cancel the order for the Boeing 777 and 787 jetliners. The planes are needed to replace aging wide-body aircraft and implement the airline's new business plan which calls for more long-range, point-to-point international flying.

In an attempt to quash the protest, the airline filed an application last Friday to the Canada Industrial Relations Board (CIRB) asking it to declare the pilots' actions an illegal strike and respond by ordering them to take another ratification vote.

Ms. Cooke said that, with the ratification in hand, Air Canada would be in a position to negotiate a new deal with Boeing for the 777 and 787 aircraft. A source at Boeing told the Financial Post last week that the aircraft manufacturer was still in talks with Air Canada about the jet order.

Ben Cherniavsky, an analyst at Raymond James, said he has long been warning investors about the potential for labour unrest at Air Canada, which could lead to "material" impact on the company's performance. He added that the seniority issue will not be easy to resolve.

When will Canadian Airlines fly to Dubai..... ?

There are 15,000 Canadians living in Dubai, and that number is growing fast.

There has been a significant increase of the number of tourists between Canada & Dubai.

Dubai is going through the worlds largest construction boom, most of the builders, architects, project managers are Canadian.

A huge number of Canadian businesses are setting up in Dubai.

Dubai even has a small NHL style leage, called THE MIGHTY CAMELS. 95% OF THE PLAYERS ARE CANADIAN.

We have a huge Canadian hotel called the FAIRMONT, two others are opening up, most of the employees are Canadian.

It blows my mind that till this day, there still is no direct link between Canada in Dubai!

When will Canadian Airlines fly to Dubai..... ?

There are 15,000 Canadians living in Dubai, and that number is growing fast.

There has been a significant increase of the number of tourists between Canada & Dubai.

Dubai is going through the worlds largest construction boom, most of the builders, architects, project managers are Canadian.

A huge number of Canadian businesses are setting up in Dubai.

Dubai even has a small NHL style leage, called THE MIGHTY CAMELS. 95% OF THE PLAYERS ARE CANADIAN.

We have a huge Canadian hotel called the FAIRMONT, two others are opening up, most of the employees are Canadian.

It blows my mind that till this day, there still is no direct link between Canada in Dubai!
Since Air Canada emerged from bankruptcy protection, its focus has been on South American and Asian routes, notably China, Hong Kong, and India. These markets are backed by Canada's significant ethnic population. Dubai is different. First of all, it is very far, and AC will most likely have to route its planes via Europe or its Asian hubs, which will tie up the planes for its more lucrative transpacific / transatlantic routes. Second, Canada has a very small UAE expatriate community and business traffic alone will not be able to sustain regular service. Otherwise AC would have launched the route already.

Emirates had voiced interest in flying to Canada before, but that idea has died down lately. Perhaps they want to grow their New York route first before further expansion.

ACE Aviation Completes Aeroplan Income Fund IPO
29 June 2005

MONTREAL (Dow Jones)--Aeroplan Income Fund (AER.UN.T) has completed its initial public offering of 25 million units at C$10 a unit for gross proceeds of C$25 million.

In a news release, Aeroplan Limited Partnership and its owner, ACE Aviation Holdings Inc. (ACE.B.T), said the fund is acquiring a 12.5% (14.4% assuming full exercise of the overallotment option) ownership interest in Aeroplan LP.

They said Aeroplan LP will retain about C$100 million of the net proceeds of the offering to partially fund a reserve for Aeroplan Mile redemptions and for certain capital expenditures, and will distribute the balance of the net proceeds, about C$125 million (C$160 million assuming full exercise of the overallotment option), to ACE. ACE will use the proceeds for general corporate purposes, they said.

ACE and Aeroplan said the fund has granted to the underwriters, co-led by RBC Capital Markets as sole bookrunner, CIBC World Markets, and Genuity Capital Markets, an option to purchase up to an additional 3.75 million units at the offer price for up to 30 days following the closing to cover overallotments, if any, and for market stabilization purposes.

They said distributions will be paid monthly. The first distribution is expected to be paid on or before Aug. 15 to unitholders of record on July 29.

In connection with the offering, they said Aeroplan LP has also completed a C$475 million senior secured syndicated credit facilities. About C$300 million of this will be used to fund the balance of the reserve for Aeroplan Mile redemptions. RBC Capital Markets acted as lead arranger, sole bookrunner and administrative agent.

ACE Aviation Holdings is the parent holding company of Air Canada.

Aeroplan is a loyalty-marketing company.

Is Dubai closer to Vancouver or Toronto?

Dubai - Vancouver: 11, 242 km
Dubai - Toronto: 9, 722 km
These are over The Atlantic so i am not sure about crossing the Pacific.

Since Air Canada emerged from bankruptcy protection, its focus has been on South American and Asian routes, notably China, Hong Kong, and India. These markets are backed by Canada's significant ethnic population. Dubai is different. First of all, it is very far, and AC will most likely have to route its planes via Europe or its Asian hubs, which will tie up the planes for its more lucrative transpacific / transatlantic routes. Second, Canada has a very small UAE expatriate community and business traffic alone will not be able to sustain regular service. Otherwise AC would have launched the route already.

Emirates had voiced interest in flying to Canada before, but that idea has died down lately. Perhaps they want to grow their New York route first before further expansion.

I'm sorry, I strongly disagree...

For one like I mentioned there are 15,000 strong & fast growing Canadian population that lives in Dubai, most will fly atleast once a year back & forth to Canada. That along is massive.

The trade between the 2 countries is exploding, and as I said there are probably 100's of engneers and architecs patictipation in Dubai's massive construction boom.

The majority of the live music bands in Dubai are from Canada.

Canadian business are mushrooming all across Dubai, we have tons of Second cup, Aldo, Lasenza, I got go on & on, and those certainly don't include the many big scale Canadian companies set up all over our free zones.

Lucrative, Dubians have more money than they know what to do with, if Toronto for example promotes itself well to Dubai, it could attract huge money... Australia is a great example, it's as far as Canada is from Dubai, and they are promoting heavily all over in Dubai, and it's been very succesful, Dubai Australia route has always 95% plus occupancy, thousands a month flock to Australia. Dubians are loving it so much, that they are investing hundreds of million of dollars into the Australian economy.

Most importantly Canada does have a huge expatriate community from the UAE. Thousands of Indians, Pakistanies and Arabs of all nationalities, immigrated to Canada from Dubai where they were residents. But when looking at them you think they came from India or Egypt for example. The majority of those imigrants still have strong ties and business links with the UAE.

When I fly to Toronto via British Airways, I fly through London, England, I take this journey at-least twice a year...

I assure you, that always atleast half of my plane, transits with me to continue to Toronto.

It's amazing to me how this route is still being ignored!!!!!!!

I'm sorry, I strongly disagree...

For one like I mentioned there are 15,000 strong & fast growing Canadian population that lives in Dubai, most will fly atleast once a year back & forth to Canada. That along is massive.

The trade between the 2 countries is exploding, and as I said there are probably 100's of engneers and architecs patictipation in Dubai's massive construction boom.

The majority of the live music bands in Dubai are from Canada.

Canadian business are mushrooming all across Dubai, we have tons of Second cup, Aldo, Lasenza, I got go on & on, and those certainly don't include the many big scale Canadian companies set up all over our free zones.

Lucrative, Dubians have more money than they know what to do with, if Toronto for example promotes itself well to Dubai, it could attract huge money... Australia is a great example, it's as far as Canada is from Dubai, and they are promoting heavily all over in Dubai, and it's been very succesful, Dubai Australia route has always 95% plus occupancy, thousands a month flock to Australia. Dubians are loving it so much, that they are investing hundreds of million of dollars into the Australian economy.

Most importantly Canada does have a huge expatriate community from the UAE. Thousands of Indians, Pakistanies and Arabs of all nationalities, immigrated to Canada from Dubai where they were residents. But when looking at them you think they came from India or Egypt for example. The majority of those imigrants still have strong ties and business links with the UAE.

When I fly to Toronto via British Airways, I fly through London, England, I take this journey at-least twice a year...

I assure you, that always atleast half of my plane, transits with me to continue to Toronto.

It's amazing to me how this route is still being ignored!!!!!!!
I doubt that airlines in both Canada and the UAE are willing to ignore a profitable route. Even if AC is not capable of operating this route right now, Emirates certainly can given its rapid expansion.

15,000 passengers flying two roundtrips a year is actually not very much. A daily service on a long-range Airbus with 200 spaces will result in a capacity of 72,800 each way, which means every member of the UAE community will need to fly over 3 roundtrips each year to maintain a 70% loading factor. Then again, not everyone will fly with one particular airline. Some might choose to fly to New York and continue to Dubai on Emirates. Factoring the percentage of the 15,000 passengers who will fly on the Toronto direct service will mean passengers will need to fly well over 3 roundtrips a year to maintain that 70% loading factor.

The second problem is the routing. A flight to Dubai will need to stop in Europe somewhere to refuel since AC's only long-range Airbus is flying the Hong Kong route. Hence the transatlantic flights may be full of Europe-bound passengers and not enough to sustain the continuing journey to Dubai.

I'm going to be on one of those aging 767s in March next year - what's the likelihood of it being an upgraded one?

Canadian government signs travel deal with Westjet

OTTAWA, June 29 (Reuters) - WestJet Airlines Ltd. will offer discounts to Canadian government employees as part of a deal designed to save taxpayers money, officials said.

In a statement dated June 28, Canada's public works ministry said the deal would run until May 31, 2006, with an option to extend the agreement for two years after that. It did not say how deep the discounts would be.

In the 2003-2004 fiscal year, WestJet, Canada's second-largest airline, accounted for 13 percent of travel by government employees, the statement said.

Short sellers bet on impending descent of ACE stock
Rick Westhead
Toronto Star
02 July 2005

Since Air Canada emerged from bankruptcy protection nine months ago, shares of its parent company, ACE Aviation Holdings Inc., have doubled in value, making the company the toast of Bay Street.

Yet with fuel costs climbing to record highs, a growing number of investors are betting that shares of the carrier are poised to hit some turbulence.

While widely traded class B shares of the Montreal company - Canada's largest airline - have soared as high as $43 since they began trading on Sept. 30, bearish bets against the stock in the form of short positions have climbed in recent weeks.

Short sellers, who expect a stock to swoon, sell borrowed stock betting that they'll make money by buying it back at a lower price before returning it to the original lender.

The number of ACE Aviation short positions still active had more than tripled to 1.24 million shares as of June 15, up from 374,503 shares in mid-May. In fact, the number of shares in the company that were in short positions in June was more than the previous three months combined.

Another negative measure may suggest investors' attitude toward ACE shares is cooling. The short-interest ratio, the number of days of average trading it would take to cover all of the short positions on the airline's shares, rose to seven days in June, up from 4.8 days in May and 2.6 days in April.

"The stock is vulnerable," said Fadi Chamoun, an analyst with UBS Canada, who in a May 25 report to clients predicted ACE Aviation shares would climb to $49 over the following 12 months.

Air Canada declined to comment on the short activity.

One reason investors may be skeptical about the prospects for Air Canada's share price is the ever-climbing price of jet fuel, the company's second-largest expense after labour.

The International Air Transport Association recently said the cost of jet fuel rose 58 per cent this year to a record $76.38 (U.S.) a barrel on April 4. In all, the world's airlines might face an $83 billion fuel bill this year, 31 per cent more than a year ago, the trade association said.

It's also possible investors are betting Air Canada shares will ease now that the company has completed an IPO for its Aeroplan frequent flyer program. In the weeks before the airline announced it would proceed with the stock sale, shares of Air Canada climbed in anticipation of the move, analysts said.

To be sure, ACE Aviation still has its fans. Of the 15 analysts that cover the company, 13 recommend ACE Aviation as a "buy," while the other two - analysts at Credit Suisse First Boston and Scotia Capital - have rated the company "hold."

ACE Aviation share supporters argue the company has a healthy potential to grow, considering that many of the large U.S. carriers remain in financially precarious situations. For instance, 29 per cent of the shares of Delta Air Lines Inc., the third-largest U.S. carrier, are in short positions.

Air Canada's parent company, meanwhile, narrowed its net loss in the first quarter to $77 million (Canadian), down from $304 million in the comparable period a year ago when it was still operating under court-ordered protection from its creditors. This year's first-quarter loss was Air Canada's lowest since 2000, when the carrier lost $33 million.

I'm going to be on one of those aging 767s in March next year - what's the likelihood of it being an upgraded one?
AC's 767 in London - quite an old plane
http://www.globalphotos.org/london/20050424/RIMG0313.jpg

Air Canada slips on Boeing order list
Delay due to labour dispute with pilots costs airline delivery slots for two 777s
BRENT JANG
5 July 2005
The Globe and Mail

Air Canada's hopes of salvaging its $6-billion (U.S.) aircraft order with Boeing Co. have been dealt a severe blow because the airline is being forced to relinquish coveted delivery slots.

Boeing spokesman Brian Walker said in an interview that the aircraft maker is busy processing orders from other airlines, so it can't afford to save delivery slots for Air Canada's plan to buy 18 Boeing 777s and 14 Boeing 787 Dreamliners. Air Canada already has lost its place in line for two of three Boeing 777s sought for 2006, Mr. Walker said.

In mid-June, a slight majority of members of the Air Canada Pilots Association (ACPA) rejected a proposed labour pact for flying new Boeing jets because the pilots were upset about seniority rankings. That forced Air Canada to cancel its order, placed in April, with Boeing because the airline made its purchase contingent on pilots' approval of the labour deal.

However, in a last-ditch effort to preserve its order, the carrier asked the Canada Industrial Relations Board in late June to help resolve the pilots' labour dispute that scuttled the planned purchase. Air Canada wants the quasi-judicial tribunal to order a new vote on the rejected labour contract.

An airline source said Air Canada and Boeing no longer have any realistic hopes of reviving the original $6-billion order. Instead, Air Canada will seek to renegotiate a new deal with Boeing because the original order is now in tatters, he said.

Air Canada is on the verge of losing its third delivery slot in 2006 for a Boeing 777.

Remaining orders for Boeing 777s were scheduled to be filled once every two to three months, starting in 2007. But so long as the pilots' dispute over seniority drags on, Air Canada will gradually lose more delivery slots that it had previously secured from Boeing.

“We hope in the short term that we do end up winning Air Canada's business,” Mr. Walker said. “In all likelihood they will, to the best of their ability, try to match the deal they had done with us before.”

Air Canada envisaged taking delivery of its first Dreamliner in 2010.

Airline spokeswoman Laura Cooke said the pilots' union is the key. “Should ACPA secure ratification, we would re-engage in discussions with Boeing,” she said.

Air Canada acquired Canadian Airlines International Ltd. in 2000, and has been dealing with union infighting among the pilots over seniority rankings ever since.

Raymond Hall, a spokesman for the so-called Original Air Canada (OAC) pilots, said speculation about Air Canada submitting a revised order for new Boeing jets is premature. OAC pilots remain angry because they see themselves as losers in the merged seniority list developed in 2003 by arbitrator Brian Keller, whose rankings replaced those devised in 2001 by another arbitrator, Morton Mitchnick.

“Unless Air Canada is planning to shove that labour contract down our throats, unless the contract is imposed on us, it's too early to talk about the new planes,” Capt. Hall said during a stopover in Toronto.

“Nothing is going to function properly in this airline until this seniority issue is resolved fairly.”

No date has been set yet for a labour board hearing into Air Canada's complaint that some of its pilots threatened an “illegal strike.”

Steve Garmaise, an analyst with Genuity Capital Markets, said there is plenty at stake for both Air Canada and Boeing.

With European consortium Airbus SAS still wooing Montreal-based Air Canada, “Boeing sees this as a trophy order,” he said.

Air Canada has 20 Airbus and 45 Boeing models in its wide-body fleet of 65 aircraft, so shifting to an all-Boeing strategy for long-haul jets would be a public relations coup for the U.S. aircraft maker.

Although several more delivery slots could be lost, Mr. Garmaise expects Chicago-based Boeing and Air Canada to be flexible and eventually reach “attractive terms” in a scaled-down aircraft order that sets new delivery target dates.

“You know that the pilots' issue is going to keep biting Air Canada for a while, but no one wants to run away from an order if this mess can be fixed,” Mr. Garmaise said.

Boeing said that if a revised jet order can be negotiated, it would help Air Canada find used aircraft to tide the carrier over until new fuel-efficient Boeing planes are built.

Air Canada, which emerged from bankruptcy protection last fall, is now shopping for five used aircraft.

“The market is tight, but there are always used planes available, if someone is a good customer,” said William Clark, a Toronto-based lawyer whose clients include airlines and other companies seeking to buy or lease used aircraft.

Air Canada should be put to work for military: pilot
David Pugliese
6 July 2005
National Post

OTTAWA - Air Canada planes and pilots could be used to haul troops and equipment overseas as part of a new scheme to deal with the Canadian Forces' air transportation problems.

Air force officials met several months ago with Air Canada pilot Don Eddie to hear details of his proposal, which would involve giving the military assured access to a group of the airline's planes. In addition, Air Canada pilots who are members of the military's reserve forces would do the flying as part of a plan dubbed the Canadian Global Airlift Reserve. The airline's other pilots would also be welcome to join the new reserve force.

Air Canada has about 400 pilots who are former members of the military or serving in the existing reserve force, said Mr. Eddie, who developed the plan. He is a member of the Canadian military's supplemental reserves and a former Australian air force pilot.

Air force officials say they don't believe Mr. Eddie's proposal would meet their needs at this time, but have left the door open as they consider how it might fit into Chief of the Defence Staff Gen. Rick Hillier's scheme to transform the military for the future.

"We continue to consider the viability of this proposal to see what level of investment may, in the future, be warranted, should circumstances change," Air force spokeswoman Maj. Lynne Chaloux said.

Gen. Hillier wants the Canadian Forces to be able to respond faster to missions both at home and abroad. The military, however, lacks the long-range planes to move troops and vehicles overseas or to some parts of Canada, and in the past has had to rely on renting giant Antonov cargo aircraft from a Ukrainian company.

Under Mr. Eddie's plan, the military would lease freight airliners from Air Canada, which would use the planes when they're not needed by the forces.

"Right now we're renting Antonovs and we're spending a million dollars a week on them," Mr. Eddie said.

Maj. Chaloux said military officials met with Mr. Eddie in March to be briefed on his proposal, and while the plan has some merit, the Air force believes it is of limited use to the Department of National Defence at this time.

"It has since been determined that while it was an interesting proposal, Air Canada's cargo aircraft are not the kind that DND regularly requires," she added.

For instance, the doors of the MD-11 and 747 airliners are not large enough to handle the sea containers the Canadian Forces uses to ship gear. The 747 would also require special equipment for loading, and such machinery is not always available at poorly developed airfields the military sometimes has to use on overseas missions.

Some military officials note that Air Canada planes do not have ramps to allow vehicles to roll on and roll off the aircraft, a key requirement for the Canadian Forces. In addition, there are concerns that Mr. Eddie's plan would be extremely complicated to put in place since it would involve Air Canada unions and other labour issues.

Mr. Eddie said he is aware of the limitations of civilian airliners, but noted the doors of the Boeing 747 aircraft or the new 777 plane could likely be modified to accept larger cargo. In addition, specialized loading equipment could be carried in the belly of a plane for use at austere airfields, he added.

He believes his plan could save the Canadian Forces hundreds of millions of dollars since it is considering a lease or purchase of the U.S.-built C-17 military transport plane.

Several passengers quiet brutish man on flight -- by sitting on him
Armando D'Andrea
National Post
07 July 2005

Air Canada passengers restrained a man by sitting on him after he began yelling and swearing in English and Spanish during a flight to Buenos Aires yesterday morning. Flight AC 94 was diverted to Port-of-Spain, Trinidad and Tobago at about 6:40 a.m. local time as a precautionary measure after the man stood on plane seats while causing the disturbance. Witnesses said several passengers had to physically restrain the man, who appeared drunk. Air Canada officials said he was also abusive to crew members and approached a flight attendant in "a threatening manner." After a two hour wait in Port-of-Spain Air Canada said the plane resumed its flight to Buenos Aires. They said the man is now in the hands of Port-of-Spain authorities. Witnesses also said that the passengers on board were shaken up, but otherwise OK. No weapons were involved.

WestJet June Load Factor Increases To 73.5%
7 July 2005

CALGARY (Dow Jones)--WestJet Airlines Ltd. (WJA.T) flew 615.4 million revenue passenger miles in June, up 22.4% from 502.6 million a year ago.

In a news release, the airline said that, in the year to date, traffic increased 35.8% to 3.73 million revenue passenger miles.

In June, its capacity rose 19.8% to 837.8 million available seat miles from 699.3 million a year in June 2004. For the year to date, capacity rose 27.1% to 5.16 billion available seat miles.

The airline's load factor in the latest month was 73.5%, up from 71.9% a year ago. For the first six months of 2005, Westjet's load factor increased to 72.3% from 67.7% in 2004.

West-Jet is a low-cost airline.

Air Canada June Traffic Up 7.3%
7 July 2005

MONTREAL (Dow Jones)--Air Canada, ACE Aviation Holdings Inc's (ACE.B.T) mainline air carrier, had a load factor of 81.3% last month, its highest ever for June.

In a news release, the airline said its traffic rose 7.3% to 4.00 billion revenue passenger miles from 3.73 billion in June 2004.

Its capacity increased 4.7% to 4.91 billion avalibale seat miles in the latest month from 4.69 billion a year earlier.

Its year-earlier June load factor was 79.4%.

For the year to date, its traffic rose 5.6% to 21.15 billion revenue passenger miles and its capacity rose 1% to 26.57 billion available seat miles. For the first six months of 2005, the airline's load factor rose to 79.6% from 76.1%.

ACE Aviation's regional carrier, Jazz, recorded traffic of 214 million revenue passenger miles in June, up 37.2% from 156 million a year ago. Capacity rose 23.9% to 285 million available seat miles, and load factor increased 75.1% from 67.8% a year ago.

Air Canada to Serve Delhi Via Zurich with Introduction of Year-Round Daily Service to Switzerland and India

MONTREAL, July 8 /CNW Telbec/ - Air Canada today announced that effective October 30, 2005, it will serve Delhi via Zurich on a daily year-round basis from Toronto. The transfer of flights to India via Switzerland will allow Air Canada to re-introduce year-round service to Zurich while improving its schedule to India with an increase to daily flights from its current three-times weekly non-stop service from Toronto. In addition, Air Canada plans to pursue a codeshare agreement with future Star Alliance member, Swiss International Air Lines, by which SWISS would sell seats on a codeshare basis on the Air Canada-operated flights via Zurich.

"By offering same-plane, one-stop service to India via Switzerland, Air Canada customers will benefit from an expanded choice of year-round daily flights to both Zurich and Delhi," said Ben Smith, Vice President, Network Planning. "We look forward to pursuing talks on commercial cooperation with SWISS, our future Star Alliance partner, to serve the Europe-India market as well. Moreover, deployment of right-sized Boeing 767-300ER aircraft on the route will allow us to optimize use of passenger and cargo capacity, and reintroduce our premium Executive First product in the Zurich market on a year-round asis."

Flights will be operated using 212-seat Boeing 767-300ER aircraft offering a choice of Executive First and Hospitality service. Flight attendants speaking Hindi, Punjabi and German, as well as English and French, will be available to serve customers in their choice of language. Customers will be offered a choice of western and Indian meals, and the in-flight entertainment program will include a number of German-language selections, as well as Indian "Bollywood" recent releases on the Zurich-Delhi segment.

Air Canada has timed its Zurich/Delhi service to offer excellent connections to and from cities across Canada via its main hub in Toronto.

Toronto Zurich Zurich Delhi
AC878 18:40 08:35 (+1) 10:10 22:20

Delhi Zurich Zurich Toronto
AC879 02:30 07:00 09:55 13:05

WOW! WestJet's been around since 1996?! I think I heard about it after Air Canada filed for protection from creditors (poor bastards). I've been seeing and hearing a lot of their commercials lately, sounds nice.

WestJet aims to add extras — for a price
User-pay items may include satellite radio
BRENT JANG
9 July 2005
The Globe and Mail

Discount carrier WestJet Airlines Ltd. is seeking to add frills by bundling user-pay services aboard upgraded planes while still guarding its traditional strength in attracting budget travellers.

The Calgary-based airline, on the eve of celebrating its 10th anniversary next February, is considering a range of options to lure passengers willing to pay extra for everything from movies to Internet access to satellite radio.

Donald Bell, WestJet executive vice-president of customer service, said the strategy is designed to expand services for business and gadget-minded travellers without sacrificing the airline's appeal to budget-conscious consumers.

“This would be value-added stuff. You could buy different things,” Mr. Bell said in an interview. “As we become a bigger and bigger player in Canada, we have to appeal to more and more people — give them choices.”

The carrier is looking at the feasibility of installing satellite radio channels on WestJet's fleet, as well as equipping planes to handle cellphones, text messaging, BlackBerrys and Internet access for laptops.

“Those are all future things that we're looking at in the next couple of years,” he said. “It's something we're keeping a close eye on to see if it's technologically and economically viable.”

In introducing new offerings, WestJet hopes to boost its revenue by charging for frills. One idea up for discussion is to bundle various services for a single fee, so that a passenger pays the basic ticket price but has the option of upgrading in advance to receive a sandwich, drink, higher-quality headset and movie. Advance seat selection is free for now, but could become a user-pay perk.

Another possibility for upgrades at some airports could be admission to common-use lounges.

A $2.7-million computer reservation system would help keep track of passengers ordering bundled services. WestJet announced the new computer installation in February, after technical glitches wreaked havoc on customer bookings last fall. When the installation is completed in November, the new booking system will also allow WestJet to join airline partnerships, said Mr. Bell, who declined to discuss potential alliances.

Hong Kong-based Cathay Pacific Airways Ltd. said last fall that it held preliminary talks with WestJet about a possible strategic alliance, but cautioned that it could take until late 2005 to implement.

The goal is to connect to Cathay seamlessly on one WestJet booking, with bags transferred, too.

WestJet's free LiveTV has been popular with passengers since being introduced in 39 Boeing 737 aircraft this past spring, Mr. Bell said.

He said initial “amplifier” problems with 26 antennas have been largely overcome by installing new components. There are now plans to enhance the programming offered on the LiveTV screens, which are built into the back of each leather seat. Bell ExpressVu LP supplies the live satellite feed.

Besides continuing with 24 LiveTV channels, WestJet is considering launching four channels with “first-run” movies made available to airlines after hitting theatres but before they are released on DVDs. WestJet may charge $5 to each passenger ordering a movie on a personal LiveTV screen.

Other new channels could feature prerecorded Treehouse programming for children and a WestJet promotional broadcast, with content originating from video servers aboard planes.

“We had a few issues crop up, but it's way better now,” Mr. Bell said. “When you're moving a satellite receiver-antenna through the air at 800 kilometres an hour, and it's receiving 24 simultaneous channels from a satellite in space, there's a lot of technology involved.”

David Newman, an analyst with National Bank Financial Inc., said business travellers are irked at having to pay “exorbitant rates to legacy airlines,” so that leaves an opening for WestJet to outmanoeuvre rivals, notably Air Canada.

“Low-cost carriers, particularly WestJet, may be viewed more favourably by the corporate travel market, especially with improving service levels and perks,” Mr. Newman said in a recent report.

Starting this fall, WestJet will offer higher-quality headsets for $2 or $3 apiece. Last month, WestJet began charging $1 for each basic headset.

“We encourage people to bring their own headset since we have a jack that's the same as your iPod, but if you don't have a headset, we'll sell you one,” said Mr. Bell, who added that WestJet headsets left aboard planes get discarded in the garbage. “We hate throwing them out. Headsets are there for you to take and bring on your next flight.”

Air Canada reports Record Load Factors for June 2005
8 July 2005


Air Canada reported a system load factor of 81.3% in June 2005, the highest ever for the month of June. The mainline carrier flew 7.3% more revenue passenger miles (RPMs) in June 2005 than in June 2004, according to preliminary traffic figures. Overall, capacity increased by 4.7%, resulting in a load factor of 81.3%, compared to 79.4% in June 2004; an increase of 1.9 percentage points.

In the domestic market, capacity increased by 1.3% and traffic increased by 5.2% resulting in a domestic load factor of 81.2% - a 3.1 percentage point increase year over year.

Jazz, Air Canada's regional airline subsidiary, flew 37.2% more revenue passenger miles in June 2005 than in June 2004, according to preliminary traffic figures. Capacity increased by 23.9%, resulting in a load factor of 75.1%, compared to 67.8% in June 2004; an increase of 7.3 percentage points.

North American traffic, on a combined basis for Air Canada and its regional carrier, Jazz, rose 10.1%.

"In June the airline again achieved record load factors for the 15th consecutive month, a clear confirmation of growing customer preference for the Air Canada product over and above the market's continuing recovery," said Montie Brewer, President and Chief Executive Officer. "Our North American traffic performance was particularly strong with Air Canada and Air Canada Jazz together reporting a 10 percentage point increase over last year's record for the month."

Air Canada ejection broke rules
Passenger ordered off: Armed sky marshal bumped paying traveller on tarmac
Adrian Humphreys
National Post
11 July 2005

Air Canada violated transportation regulations by ordering a paying passenger off a flight from Toronto to Washington, D.C., to make room for an armed sky marshal, Canada's transport regulator has ruled in a decision that sheds light on the secretive and sometimes rocky efforts to protect air travel.

The saga of Harry Schatz, detailed in a Canadian Transportation Agency ruling released on Saturday, shows meeting the enhanced security requirements of the U.S. government can bring unexpected headaches.

Mr. Schatz arrived at Toronto's Pearson airport in good time for his flight on Aug. 29, 2004.

He checked in at a self-serve kiosk, brought only a carry-on bag with him and easily cleared security and U.S. Customs in time to eat before boarding.

He was assigned seat 3A on Air Canada's Flight AC 536.

Departure was delayed, however, when passengers were told "must-fly" passengers had not yet arrived, the agency's ruling says.

After the loaded plane sat on the airport tarmac for an hour, an Air Canada supervisor and an armed police officer approached Mr. Schatz and asked him to leave the aircraft with them.

"He was deplaned without any explanation and, therefore, with much embarrassment," the agency said. Mr. Schatz was escorted to the terminal.

Two seats needed to be made available for sky marshals, Air Canada later revealed. It is not known whether they were members of the RCMP's Canadian Air Carrier Protective Program or the U.S. Federal Air Marshal Service.

Both agencies place armed agents in civilian clothes onboard some airliners to guard against hijacking.

"The flight could not have been operated without the marshals on board the aircraft," Air Canada told the agency.

Mr. Schatz complained to the transport regulator over the manner he was removed and the unfair manner in which he was selected to be bumped from the flight.

It is Air Canada's written policy to seek volunteers before forcing passengers off a plane. The agency found that was not followed in this case.

While Air Canada initially claimed he had been the last to board and hence the first to be bumped off the passenger list, it appears that was not the case.

Mr. Schatz claimed he was selected because he did not have checked-in luggage, making it easier to remove him. It is another security requirement that planes cannot carry the luggage of someone who is not on board.

Clearly, confusion over security remained at the time.

Air Canada first told the agency in October, 2004, that U.S. regulations prevented it from seeking volunteers, but in February said no such U.S. policy exists, the ruling says.

The agency says Air Canada must abide by its own Transborder Passenger Rules and Fare Tariff and if those procedures are not flexible enough to meet enhanced security measures they needed to be officially revised.

The plane was likely designed for Ronald Reagan Washington National Airport, the most security sensitive airport in the U.S. because of its close proximity to the White House and other U.S. government buildings.

Since the Sept. 11, 2001, terrorist attacks, the U.S. government requires that all flights to Reagan airport have an armed marshal aboard, along with other security measures. Private planes are still not allow to land there.

An Air Canada spokesman could not comment on the specifics of the case when reached at home yesterday because he had no access to the file.

Discussing security details is also difficult, said John Reber, a company spokesman.

"Air Canada co-operates with the authorities to implement security measures. We can't provide details to ensure their continued effectiveness," he said.

Mr. Schatz could not be reached for comment.

Air Canada has had some armed presence aboard certain flights since the 9/11 attacks.

On Sept. 17, 2002, the RCMP, Transport Canada and the Canadian Air Transport Security Authority signed an agreement launching the Canadian Air Carrier Protective Program.

Canadian sky marshals, called Aircraft Protective Officers (APOs), are placed "on board flights designated by the Minister of Transport as requiring the presence of APOs and on board other selected flights," the RCMP says on its official Web page.

WestJet Announces Completion Of Sale Of 737-200 Fleet
12 July 2005

CALGARY (Dow Jones)--WestJest Airlines Ltd. (WJA.T) has completed the sale of its Boeing 737-200 fleet to Miami-based Apollo Aviation Group.

It didn't provide financial details.

In a news release, WestJet said Apollo has also purchased WestJet's inventory of spare parts and engines, as well as the company's 737-200 flight simulator.

WestJet has 10 737-200 aircraft remaining in its fleet, all of which will be replaced by Next-Generation 737 aircraft by March 2006, it said. Beginning in March 2006, WestJet will operate a fleet made up exclusively of Boeing Next-Generation 737 aircraft. It currently operates 44 Next-Generation aircraft in its fleet of 54 aircraft.

WestJet is a low-cost airline.

Ex-CAI pilots ask federal tribunal to uphold seniority list
Want to preserve Air Canada ranking
BRENT JANG
13 July 2005
The Globe and Mail

Former Canadian Airlines International Ltd. pilots have asked the federal labour board to uphold seniority rankings for all Air Canada pilots, urging the tribunal to ignore the “disrespectful diatribe” of disgruntled airline employees.

Since Air Canada merged operations with CAI in 2000, the airline has endured heated arguments among 3,000 unionized pilots from the two carriers.

James Hayes, a lawyer representing former CAI pilots, told the Canada Industrial Relations Board that it should dismiss attempts by so-called Original Air Canada pilots to quash the existing seniority system. OAC pilots are upset over a merged seniority list developed in 2003 by arbitrator Brian Keller, whose rankings replaced those submitted in 2001 by another arbitrator, Morton Mitchnick.

Former CAI pilots say that their own union, the Air Canada Pilots Association, is biased in favour of OAC pilots and the offshoot Red Pilots for Seniority Justice.

“It appears to be an impossible task for seniority arbitrators to make everyone happy, to convince everyone that their chosen arbitration outcome is demonstrably fair,” said Mr. Hayes, who added that he “rejects and objects strongly to the disrespectful diatribe” of pilots' union leaders advocating a revised seniority list.

“Air Canada has an obligation to remain neutral with respect to the internal seniority affairs of the pilot group,” he wrote in a new filing.

Former CAI pilots are miffed that numerous OAC pilots campaigned last month to narrowly defeat a proposed labour contract that would have cleared the way for Air Canada to order $6-billion (U.S.) in new Boeing 777s and 787s.

Mr. Hayes said his clients will support any declaration by the labour board to “state and confirm, one last time, that the issue of seniority among Air Canada pilots has already been finally and fully settled” in previous tribunal rulings and court judgments.

“In particular, the former Canadian pilots take great exception to the suggestion that the Keller award was unfair,” Mr. Hayes said. “There were pilots from both sides who were unhappy for various reasons — as is inevitably the case with any seniority integration outcome.”

Montreal-based Air Canada complained to the labour board last month that Red Pilots threatened to engage in an “illegal strike” to pressure the company to revamp seniority rankings.

Mr. Hayes said his clients take “no position as to whether or not the alleged misconduct constitutes an unlawful strike.”

He said OAC pilots who persist in their feuding over seniority are misguided in presenting a “rambling rendition” of perceived injustice.

OAC pilots who rejected the labour deal to fly new Boeing jets should be reprimanded and not rewarded for unreasonable seniority demands, Mr. Hayes added.

Deaf-blind man posed air safety hazard: tribunal
Air Canada was right not to allow man to fly alone
Armando D'Andrea
National Post
13 July 2005

Air Canada was right to insist a deaf-blind man travel with an attendant, a transportation tribunal has ruled, citing safety concerns as a top priority.

The Canadian Transportation Agency found that Air Canada's requirement that Eddy Morten travel with an attendant from Vancouver to San Francisco last fall was not an "undue obstacle."

It said the policy was justified because to allow him to travel alone could have hindered "not only his own safety but the safety of all passengers" by slowing down the evacuation process in the event of an emergency.

Almost three weeks after purchasing his ticket on Aug. 12 last year, Mr. Morten was advised that Air Canada refused to fly him alone.

Defined by Air Canada as "non self-reliant," Mr. Morten chose to have his ticket refunded when told he would have to buy a second ticket for an attendant.

Among Air Canada's concerns was that emergency evacuation success depends on how effectively verbal and visual instructions are understood, according to the 10-page decision issued last week.

It also said it would be "irresponsible" to expect flight attendants or other passengers to tend to the needs of one passenger in particular and use different methods of communication with that passenger during an emergency evacuation.

However, according to the decision, Mr. Morten felt he had effective methods of communication that would not have hindered the instruction process in the event of an emergency.

He said he could travel independently with his dog, an electronic keyboard that helps him communicate and with preprinted index cards with statements in Braille such as "ALERT follow me immediately" and "ALERT Emergency Door Exit."

He also pointed to the agency's own code of practice for travellers with disabilities, which says "personnel should be aware of the universal sign for an emergency situation, i.e. drawing the letter X on the back of the person who is deaf-blind with one's fingertips."

Mr. Morten has flown by himself previously -- to Milan in 1991 and to San Francisco earlier last year -- which Air Canada said was "inconsistent" with its policy. The airline said "he and other passengers were extremely lucky no one got hurt."

Laura Cooke, a spokeswoman for Air Canada, said safety was the paramount concern.

"The point which I think is made in this decision for us is safety is our number one priority," she said. "Our concern remains in the event of an emergency: We need to be able to quickly and easily communicate important instructions to our customers."

However, Jane Sayers, president of the Canadian National Society of the Deaf-Blind, said she was disappointed with the decision.

"I'm not a very happy camper at the moment about this," she said. "I do feel it is an undue obstacle. The majority of persons with disabilities, especially deaf-blind people, cannot afford to buy two seats to go someplace.

"Who can afford that? I know I can't. Every time I want to go someplace I have to take someone with me?"

Ms. Sayers conceded that many deaf-blind people would not, in fact, choose to travel alone. Nonetheless, she said, how they choose to travel should be their prerogative.

"It should be our decision what we can or can't do, not someone else's decision."

Flew AC once from Madrid to Toronto and will never do it again;rudest cabin crew I've encountered in my entire life.

Airline warned about serving disabled
Air Canada told to fix on-line system
PAUL WALDIE
15 July 2005
The Globe and Mail

Air Canada has been told by federal regulators to overhaul its on-line reservation system to better accomodate people with disabilities.

Air Canada's system “lacks essential information for persons with disabilities booking on-line,” the Canadian Transportation Agency said in a ruling released yesterday.

The CTA added that the choice of services available to disabled travellers on-line “is very limited and, in fact, does not include all of the services offered by Air Canada to persons with disabilities when they travel, nor many of the fundamental services that a carrier is required to provide pursuant to [airline regulations].”

The ruling stemmed from a case involving Wilfred Legault, who has multiple sclerosis and experiences difficulty walking and climbing stairs. In November, 2004, he used Air Canada's on-line system to book a ticket from Winnipeg to Phoenix, via Denver. The site permitted him to select one type of assistance and he requested a “wheelchair within terminal.”

The aircraft used for the first leg of the flight was a regional jet and Mr. Legault had to walk from the terminal building to the plane, according to the CTA ruling. Mr. Legault filed a complaint about the trip and argued that had he known the airplane would not dock at the terminal building, he would have selected another flight. He also raised concerns about the on-line reservation system.

Air Canada argued that it provides a wide range of services to disabled passengers, but requires 48 hours notice. The airline said there are limits to what it can put on the website and passengers who require more assistance should contact a call centre and explain.

In its ruling, the CTA said other airlines have been able to put more information and options on their reservation sites. The agency noted that disabled passengers can only make one choice on Air Canada's system even though they may require several types of services. “For example, a person such as Mr. Legault who requires wheelchair assistance for distances and assistance climbing stairs cannot indicate his or her need for both of these services when making an on-line reservation,” the agency said.

It concluded that Air Canada's system constituted an undue obstacle to the mobility of all people with disabilities.

The CTA ordered Air Canada to review its reservation system within 30 days and make changes that will broaden the type of information available for disabled travellers. The airline must also provide a detailed account of how the system works and “if Air Canada is limited in the services it can add to [the system], it is to provide a detailed explanation as to why this is so.”

Laura Cooke, an Air Canada spokeswoman, said the company is studying the ruling. “We are reviewing our on-line offerings for people with special needs in light of the CTA interim decision and will respond directly to the CTA within the required time frame,” she said.

If you subsidize rivals, no flights to Toronto, Air Canada tells PEI

Air Canada is cancelling its Toronto-Charlottetown fall and winter flights because it's livid about the PEI government's subsidies for rival WestJet Airlines Ltd.

Air Canada will be placing advertisements in local newspapers in Prince Edward Island this week to notify travellers about the airline's withdrawal, beginning in October, of flights between Toronto and Charlottetown.

PEI Premier Pat Binns' government had lured WestJet to launch service in the province by providing about $500,000 in marketing and revenue incentives.

WestJet made its PEI debut on June 28, when it launched its Toronto-Charlottetown summer-only route, offering daily non-stop flights to and from the island. The seasonal service is scheduled to end Sept. 15. Air Canada points out that it uses profit from the summer to bolster weaker winter months to maintain the route year-round, so the carrier is disturbed that the government chose to subsidize WestJet at the height of tourist season.



"Despite numerous discussions and meetings with PEI officials, including the Premier, over the past few months, we were unable to come to an agreement that would have levelled the playing field and enabled Air Canada to maintain its year-round service between Charlottetown and Toronto," Air Canada spokeswoman Laura Cooke said.

Air Canada, through its Jazz subsidiary, will continue to provide year-round flights to Halifax and Montreal from the PEI capital. Its Toronto-Charlottetown Jazz service will resume next spring, but will only last for six months before going dormant again in October, 2006.

The airline has notified Mr. Binns and federal Transport Minister Jean Lapierre about its decision.

On April 26 in the PEI Legislature, opposition Liberal leader Robert Ghiz criticized the provincial Progressive Conservative government for interfering with air schedules and ignoring the implications of the WestJet subsidies. But Mr. Binns played down a letter of complaint written April 21 by Air Canada's senior director of corporate affairs, Lyse Charette.

The government's meddling forced Montreal-based Air Canada to scrap plans to boost passenger and cargo service in the summer to the island, Ms. Charette said.

Ms. Cooke added that Air Canada has been a loyal corporate citizen in Prince Edward Island, helping the local economy by transporting visitors from Canada and Japan wanting to see Anne of Green Gables tourist attractions.

"Air Canada and its regional and associated carriers are proud to have served Charlottetown for more than 30 years -- longer and more consistently than any other carrier -- and to have contributed over that period to the economic development of the province," Ms. Cooke said.

WestJet spokeswoman Gillian Bentley said the Calgary-based discount airline has yet to decide whether to extend its Toronto-Charlottetown flights beyond the targeted ending date of Sept. 15.

"It will depend on how the service is going and our aircraft availability," Ms. Bentley said. "For Charlottetown, it's more of a tourist and seasonal thing. We have to be sure that the numbers are there and it's got to be a feasible route."

A unit of Northwest Airlines Corp. of Eagan, Minn., is providing Detroit-Charlottetown summer service with the aid of $200,000 in PEI subsidies, critics say.

"The government's decision to support other carriers during the lucrative summer peak season has distorted market forces," Ms. Cooke said.

Air Canada has been benefiting from flying Japanese passengers on its Tokyo-Toronto route before connecting them on to the Toronto-Charlottetown service. But Canada's flag carrier sees Northwest as a competitive rival for carrying international visitors to Charlottetown.

Air Canada continues route expansion with more non-stop flights and improved schedules across Canada and the United States

MONTREAL, July 18 /CNW Telbec/ - Air Canada today announced major schedule enhancements in Canada and the United States with the introduction of daily non-stop services between Vancouver-San Diego, Abbotsford-Toronto, Abbotsford-Calgary, Calgary-Newark and Calgary-Orlando. The airline is also implementing significant schedule improvements with additional flights and more routes with jet service across its network, North America wide.

The new routes and additional flights will be operated by Air Canada and Air Canada Jazz, and are being introduced to respond to new market opportunities made possible with the renewal of the carriers' fleets that has begun with the delivery of new Embraer and Bombardier jet aircraft.

"The arrival of next-generation jet aircraft in our North American fleets allows Air Canada and Jazz to offer customers more point-to-point, non-stop flights, enhanced schedules and more jet service," said Ben Smith, Vice President, Network Planning. "Fifteen consecutive months of record-breaking load factors reflect the high demand for the Air Canada product, and the introduction of new fuel-efficient Embraer and Canadair Regional Jet aircraft will allow us to pursue new market opportunities. Our focus remains on strategic growth as we continue to take delivery of these new aircraft that will meet travellers' needs by offering the best schedules, the most choice and the lowest fares on an everyday basis."

Consumers in Western Canada in particular will benefit from many new non-stop services and improved schedules with more jet flying. With these schedule improvements, Air Canada and Air Canada Jazz will offer up to 188 flights per day to and from Calgary on 32 routes, more than any other carrier. Overall, the carriers will serve 60 destinations in Canada and 50 in the United States, operating more than 1,300 flights per day on 194 non-stop routes. This winter, Air Canada will operate up to 36 flights per day to and from Florida on 15 non-stop routes; and up to 44 flights per day to and from California on nine non-stop routes, the most flights of any carrier to these popular destinations.

With the addition of Embraer and Bombardier aircraft in their North American fleets, Air Canada and Air Canada Jazz will introduce the following new services:

NEW ROUTES

Vancouver-San Diego: Effective December 17, 2005, Air Canada Jazz will introduce daily non-stop flights using 75-seat Canadair Regional Jet CRJ-705 aircraft.

Abbotsford-Toronto: Effective December 17, 2005, Air Canada will introduce daily non-stop flights using 93-seat Embraer 190 aircraft. Air Canada will thus offer the only daily non-stop service between these two cities.

Abbotsford-Calgary: Effective December 17, 2005, Air Canada Jazz will introduce three-times daily non-stop flights using 75-seat Canadair Regional Jet CRJ-705 aircraft, the only carrier offering business class service between these two cities.

Calgary-Newark: Effective December 1, 2005, Air Canada will introduce daily non-stop flights using 93-seat Embraer 190 aircraft. Air Canada will thus offer the only year-round daily non-stop service between these two cities.

Calgary-Orlando: Effective December 17, 2005, Air Canada will introduce twice weekly non-stop flights on Saturday and Sunday during the winter season using 120-seat Airbus A319 aircraft, the only carrier offering business class service between these two cities.

On June 2, 2005, Air Canada announced new non-stop services made possible with the renewal of its North American fleet: Vancouver-Las Vegas (October 30, 2005), Calgary-Las Vegas (October 30, 2005), Edmonton-Regina (August 1, 2005), Edmonton-Saskatoon (August 1, 2005), Hamilton-Montreal (September 18, 2005) and Hamilton-Ottawa (September 18, 2005).

IMPROVED SCHEDULES

Air Canada is enhancing service on the following routes with the introduction of more flights and year-round service this coming fall and winter compared to last year:

Vancouver-San Francisco: Up to three daily non-stop flights with the introduction of one additional flight effective December 17, 2005.

Kelowna-Toronto: Effective February 4, 2006, Air Canada will increase service to offer daily non-stop flights using 93-seat Embraer 190 aircraft.

Calgary-Houston: Up to three daily non-stop flights with the introduction of one additional flight effective immediately.

Calgary-Los Angeles: Up to three daily non-stop flights with the introduction of one additional flight effective December 17, 2005.

Fort McMurray-Calgary: Up to two daily non-stop flights with the introduction of jet service effective October 30, 2005.

Toronto-Denver: Up to three daily non-stop flights with the introduction of one additional flight effective October 30, 2005.

Toronto-Las Vegas: Up to three daily non-stop flights with the introduction of one additional daily flight effective October 1, 2005.

Toronto-Los Angeles: Up to five daily non-stop flights with the introduction of one additional flight effective immediately.

Toronto-Pittsburgh: Up to three daily non-stop flights with the introduction of one additional flight effective October 30, 2005.

Ottawa-Orlando: Effective December 17, 2005, Air Canada will increase service to daily flights on this seasonal route, the only non-stop service.

Ottawa-Fort Lauderdale: Effective December 17, 2005, Air Canada will increase service to daily flights on this seasonal route, the only non-stop service, operating a mix of Airbus and Embraer aircraft.

Montreal-Las Vegas: Effective October 30, 2005, Air Canada will increase service to offer daily flights, the only non-stop service, operating a mix of Airbus and Embraer aircraft.

Montreal-San Francisco: Effective December 17, 2005, Air Canada will introduce year-round service offering the only daily non-stop flights, using 120-seat Airbus A319 aircraft.

Moncton-Montreal: Effective immediately, Air Canada Jazz will increase service to four daily non-stop flights with the introduction of one additional flight, using 50-seat CRJ aircraft.

Deer Lake-Montreal: Effective October 30, 2005, Air Canada will extend summer flights to year-round service offering the only daily non-stop flights, using 50-seat Canadair Regional Jet CRJ-200 aircraft operated by Air Canada Jazz.

St. John's NF-Montreal: Effective October 30, 2005, Air Canada will extend summer flights to year-round service offering the only daily non-stop flights, using 75-seat Canadair Regional Jet CRJ-705 aircraft operated by Air Canada Jazz.

MORE FLIGHTS ON KEY ROUTES

Due to increased demand for Air Canada's key domestic services that have experienced sustained record high load factors, Air Canada is increasing the number of daily flights on the following key routes:

Vancouver-Toronto: Up to 15 daily non-stop flights this winter with the introduction of one additional flight.

Vancouver-Calgary: Up to 17 daily non-stop flights this winter with the introduction of three additional flights.

Calgary-Toronto: Up to 10 daily non-stop flights this winter with the introduction of one additional flight.

Edmonton-Toronto: Up to seven daily non-stop flights this winter with the introduction of one additional flight.

Winnipeg-Toronto: Up to nine daily non-stop flights this winter with the introduction of one additional flight.

Toronto-Montreal: Up to 52 daily flights this winter with the introduction of two additional flights.

NEW JET SERVICE

By October 30, 2005, Air Canada Jazz will have converted the following routes from Dash-8 turboprop to 50-seat CRJ jet service offering customers enhanced comfort and the convenience of faster travel times: Vancouver-Prince George, Vancouver-Fort St. John, Calgary-Saskatoon, Calgary-Regina, Calgary-Fort McMurray, Edmonton-Saskatoon, Edmonton-Regina, Winnipeg-Saskatoon, Winnipeg-Regina, Winnipeg-Thunder Bay, Toronto-Baltimore, Toronto-Detroit, Ottawa-Boston, Montreal-Charlottetown, Halifax-Boston and Halifax-Goose Bay.

Air Canada Jazz took delivery of its first 75-seat CRJ-705 aircraft on May 27, 2005 for a total of 15 by December 2005. The new CRJ-705s are being introduced on the following routes: Calgary-Houston (June 1, 2005), Toronto-Houston (July 1, 2005) and Toronto-Dallas (August 1, 2005).

Customers will have a choice of Hospitality or Executive Class service, a new feature on the Toronto-Houston and Dallas routes. Executive Class offers 37 inches of legroom, and Hospitality service offers an industry leading 34 inches of legroom. Both cabins feature all-leather seating, and in-seat audio and personal television systems will be installed beginning in the fall 2005.

Air Canada will begin taking delivery of the first of 15 Embraer 175 aircraft in July 2005, joining 45 Embraer 190 aircraft set to begin arrival in November 2005. The Embraer 175 aircraft has nine seats in Executive Class offering 38 inches of legroom, and 64 seats in Hospitality with up to 34 inches of legroom. The Embraer 190 has nine seats in Executive Class offering 38 inches of legroom and 84 seats in Hospitality offering 33 inches of legroom. Both cabins feature in-seat audio and video on demand to be installed in the fall 2005, in-seat power within reach of every passenger, no middle seats, generous overhead bins, wide aisles and a spacious interior.

Air Canada pulling out of P.E.I. in off-season
WestJet subsidies made it difficult for the airline to continue

BY ANDREW PHILIPS
Telegraph-Journal

New Brunswick airport heads don't plan on getting involved in a nasty dispute between Charlottetown's airport and Air Canada, which has opted to stop flying into the Prince Edward Island capital during the off-season.

John Buchanan, president and chief executive officer of Saint John Airport Authority, declined to comment on Air Canada's decision to make good on an earlier threat to stop flying to Charlottetown after the provincial government granted a $300,000 revenue guarantee to lure rival WestJet Airlines to the island this summer.

"It's an unfortunate situation that needs to be addressed between the airport authority and Air Canada," Mr. Buchanan said speaking in his role as president of the Atlantic Canadian Airports Association.

Mr. Buchanan and his counterpart in Moncton, Rob Robichaud, also opted not to speculate whether their facilities might get the now disbanded Air Canada Charlottetown-Toronto route.

Air Canada spokeswoman Isabelle Arthur said the airline hasn't decided where it might add a route to replace the Charlottetown offering.

"That aircraft will be put back into the system," Ms. Arthur said.
Mr. Robichaud said he's saddened, but not entirely particularly surprised, that Air Canada made good on its earlier threat.

"I'm never particularly pleased to hear of a community losing air service," said Mr. Robichaud, who noted any regional air-service is beneficial because it raises the area's profile. "At the end of the day, it's their (Air Canada's) decision."

But Ms. Arthur said the Island government's WestJet subsidies made it difficult for the airline to continue the service in the winter, when there are traditionally fewer travellers.

She also noted Air Canada will continue flying to Montreal and Halifax from Charlottetown and plans to begin seasonal Jazz service from the airport again next spring.

In the past, Air Canada has also received government subsidies to fly into certain locations, but those areas included places such as Bathurst, where Air Canada would have been the only carrier serving the market.

As for WestJet, the Calgary-based carrier continues to play its cards close to its chest, declining to say if it will continue flying between Toronto and Charlottetown past its previously announced, Sept. 15 end date.

"It will depend on how the service is going and our aircraft availability," WestJet spokeswoman Gillian Bentley said.

"For Charlottetown, it's more of a tourist and seasonal thing. We have to be sure that the numbers are there and it's got to be a feasible route."

Agency slams door on Air Canada cargo plan
Battle with Cargojet: Denies route bid, launches inquiry into operations
Chris Sorensen
20 July 2005
National Post

Air Canada's cargo unit has suffered an embarrassing setback after federal regulators turned down its request to fly all-cargo freighters between Toronto, Calgary and Shanghai, and launched an inquiry into the airline's existing cargo operations.

Transport Canada said yesterday it will not approve Air Canada's application to add a controversial Calgary stop to its Toronto-Shanghai service -- the latest development in what is shaping up to be a nasty battle between Air Canada Cargo and rival Cargojet Income Fund.

"We did decide that, in this case, the interest of the Canadian public wouldn't be served," said Lucie Vignola, a Transport Canada spokeswoman.

One of the loudest critics of Air Canada's plan was Cargojet, which said Air Canada's decision to add a Calgary stop to original application to serve Toronto and Shanghai was an attempt to "scoop the cream" from a profitable route. Cargojet, which was previously under contract to fly cargo between Toronto and Calgary for Air Canada, also argued Air Canada's use of leased U.S. aircraft and crews on the domestic leg of the route was unfair and threatened to open the door to U.S. competitors.

"We are just asking for a level playing field," said Ajay Virmani, chief executive of Cargojet Income Fund. "[Air Canada] tried to use a back-door approach instead of being upfront."

Laura Cooke, an Air Canada spokeswoman, said the airline was "surprised and disappointed" by the agency's decision, but added the airline's Toronto-Shanghai service will continue without the Calgary stop.

Cargojet and Air Canada are increasingly locking horns as Air Canada Cargo, a division of ACE Aviation Holdings Inc., tries to get back into the dedicated air cargo market it abandoned in the 1990s, and Cargojet, which rose from the ashes of Canada 3000's bankruptcy, attempts to protect the sizable market share it has built in just a few years.

Cargojet, a domestic-only carrier with scheduled overnight service to 13 Canadian cities, said Air Canada is not playing by the rules. It complained to the Canadian Transportation Agency (CTA) that Air Canada ran domestic cargo routes on its leased U.S. freighters without a proper licence during the past year.

The CTA responded by launching an inquiry. According to a letter sent by the CTA to both parties, Air Canada initially denied Cargojet's allegations in a sworn affidavit, but later admitted it did solicit business for a Toronto-Vancouver route on one of the leased planes in question.

In its letter, the CTA said it was "deeply concerned" about Air Canada's failure to file a full and accurate affidavit in response to the allegations raised by Cargojet. "Air Canada either failed to conduct a diligent enquiry ... or it failed, upon discovery of these irregularities, to amend its affidavit accordingly."

Air Canada's Ms. Cooke said the airline had no comment on the inquiry, other than to say the airline planned to co-operate fully.

Mr. Virmani said he is not trying to thwart Air Canada's cargo aspirations, even though Cargojet is in the midst of hammering out a strategic partnership with the Calgary Airport Authority that would see Cargojet provide the city with an air cargo link to China.

Caught in the middle of the spat is the Calgary airport, which is trying to raise its profile as an international cargo and logistics hub.

"We need that [China] service," said Stephan Poirier, the director of cargo and logistics for the airport. He said the airport is not taking sides in the dispute, but that it is eager to have a Canadian cargo carrier fly between Calgary and the huge Chinese market.

"It's disappointing that Air Canada can't do it today. But that's the way it goes. There's not much we can do about it."

Go to >>>> (http://skyscrapercity.com/showthread.php?t=230785) Air Canada continues route expansion with more non-stop flights and improved schedules across Canada and the United States

Ottawa nixes Air Canada lease of U.S. jet for Toronto-Calgary cargo
Wednesday, July 20, 2005


TORONTO (CP) - The federal transport minister has denied Air Canada's application to pick up and drop off cargo in Calgary using a leased American plane and crew en route between Toronto and China.

Canada's largest airline operates a jet on a so-called wet lease, including crew, from Washington-based Gemini Air Cargo, and plans to ship cargo from Toronto to Shanghai using the American aircraft. The flight must make a technical stop in Calgary, said Air Canada spokeswoman Laura Cooke.

Because of Transport Minister Jean Lapierre's decision Tuesday, the airline will not be able to pick up or drop off cargo in Calgary on the route

Air Canada (TSX:ACE.B) had applied for an exemption from Canadian aviation regulations governing foreign airline operations within the country.

"Air Canada Cargo is both disappointed and surprised at Transport Canada's decision to deny our ability to offer cargo services between Toronto and Calgary, then on to China," Cooke said.

"The ultimate loser we believe will be businesses and shippers in Toronto who now will not have a choice about shipping," she added. "And shippers and businesses in Calgary have now lost an opportunity for direct cargo services to a booming Chinese market."

However, competitor Cargojet (TSX:CJT.UN) praised the denial of Air Canada's application.

Ajay Virmani, chief executive of Mississauga, Ont.-based Cargojet, said the application had "met with heavy opposition from all major industry stakeholders, all of whom cited lack of economic benefits for Canadian shippers and the aviation industry."

Virmani added: "We are pleased that the minister has endorsed the views of the industry acknowledging that this application does not meet public interest requirements nor is it beneficial to Canadian consumers."

Washington-based Gemini Air Cargo describes itself as the world's largest aircraft, crew, maintenance and insurance operator of DC-10 freighter aircraft.

The E75 Has Arrived!!! :banana: :pepper: :banana2:

DCCI urges increase in flights between Dubai and Canada
BY A STAFF REPORTER

21 July 2005



DUBAI — Dubai Chamber of Commerce and Industry (DCCI) urged Canada to launch and increase the number of direct flights between Dubai and Canada due to its significant role in supporting the bilateral trade between the two countries.


Abdul Rahman Ghanem Al Mutaiwee, Director General of Dubai Chamber of Commerce and Industry (DCCI), told Graham Rush, Head of Consulate and Senior Trade Commissioner of Canada in the UAE, yesterday, citing the example of Australia, that the increasing number of flights between Dubai and Australia has largely contributed in enhancing the trade exchange between the two countries.

The meeting also discussed the ways of developing and supporting the commercial ties between Canada and Dubai through the activation of the key role of the Canadian Business Council in Dubai and setting a date for another visit of a Canadian high-ranking official delegation to the Dubai Chamber in September.

Al Mutaiwee said: "It would be highly important to activate the roles of the Canadian Business Council in Dubai and the Arab-Canadian Business Council in Canada due to their important contribution in developing the commercial relations and trade exchange between the two countries, in addition to the urgent need to launch and increase air flights between Dubai and Canada through the Emirates and the Air Canada airlines."

Rush, while agreeing on the necessity to open up the air services between Dubai and Canada due to their key role in upgrading the trade and tourism sectors in the two countries, said: "Launching new direct flights between Dubai and Canada through Air Canada and the Emirates is a very significant issue that we should discuss with our Canadian government.

We would like to send a top official delegation from Canada to visit the Dubai Chamber of Commerce and Industry in September 20th to discuss several issues that would help enhance the trade exchange between our countries, especially as Dubai is turning into an international and regional business hub."

The Canadian Consul pointed out that the top official delegation will include more than 35 people of senior Canadian politicians, the Canadian Ambassador to the UAE, as well as the Consul General and the CEOs of about 25 Canadian companies, including those operating in Dubai.

The Director General of DCCI noted that this visit would be very important in terms of helping to create a mutual vision to activate and upgrade the trade exchange and attracting investments from both countries.

"The Dubai Chamber will arrange an effective meeting for the Canadian delegation with the DCCI Chairman and some of its major members, in addition to the representatives of the Canadian Business Council in Dubai and managers of some top Canadian companies that operate in the emirate. The visit will be a chance to discuss all issues that contribute to the development of trade ties between the two countries," said Al Mutaiwee.

He said that the top Canadian delegation visit to the DCCI in September would also be an opportunity to introduce the Canadian officials and investors to the astonishing economic development which Dubai is witnessing and which helped making the emirate an international and regional business center.

Dubai's total non-oil trade with Canada has increased in 2003 to Dh831.2 million ($226.3 million), compared to Dh681.3 million in 2002 ($185.5 million).

Dubai's total imports from Canada in 2003 touched Dh611.9 million ($166.6 million), while Dubai's total exports to Canada in the same year reached Dh138.8 million ($37.7 million), whereas Dubai's total re-exports to Canada in 2003 hit Dh80.5 million ($21.9 million).

I believe if Air Canada wants to have non-stop Dubai-Toronto they would have to purchase additional A340s to cover the long distance without stopping.

Air Canada cuts back P.E.I. flights
National carrier to suspend Toronto-Charlottetown service during fall, winter months

CHARLOTTETOWN (CP) - P.E.I. Premier Pat Binns has shrugged off Air Canada's decision to cancel its Toronto-Charlottetown service during the fall and winter months following a bitter dispute over provincial subsidies offered to rival WestJet Airlines Ltd.

The soft-spoken politician held a news conference yesterday to say the announcement was "not the end of the world," mainly because Air Canada (TSX:ACE.B) has said it will continue its flights between Montreal and Charlottetown.

The premier said the province will look to another airline to provide direct-flight service between Toronto and the provincial capital during fall and winter.

Air Canada, the country's largest airline, has said the Toronto-Charlottetown service will be suspended in October but will resume next spring.

Binns said his government tried to resolve the dispute with Air Canada in recent weeks but those talks failed.

"We were not able to come to a satisfactory agreement," he said. "Air Canada wanted exclusivity in regard to advertising and they also ... wanted involvement or a veto in terms of additional carriers coming in the future."

WestJet, lured to the Island by $500,000 in marketing and revenue incentives, has offered daily, non-stop service between Toronto and Charlottetown sine June 28. But that service is limited to the summer travel season.

A spokeswoman for Air Canada said the airline's move was "purely a business decision."

Laura Cooke said the P.E.I. government's year-round subsidies for WestJet (TSX:WJA) made it difficult for Air Canada to continue service in the fall and winter, when there are traditionally fewer travellers.

"Because the market forces have been distorted, from a business perspective, we can no longer justify offering a route during the leaner winter months," Cooke said.

"The subsidy to another business carrier is diluting what we can achieve during the summer months, which, historically, had subsidized the winter operation."

However, Binns said Air Canada had received subsidies from the P.E.I. government in the past.

"We provided a subsidy to them to initiate that Montreal service and its been so successful that they run three airplanes a day from Montreal and two in the wintertime," Binns said yesterday.

WestJet spokeswoman Gillian Bentley said the Calgary-based discount airline has yet to decide whether to extend its Toronto-Charlottetown flights beyond the targeted ending date of Sept. 15.

Aeroplan Income Fund sets cash payout for August

MONTREAL, July 22 (Reuters) - Aeroplan Income Fund <AER_u.TO> said on Friday it will distribute its first cash payout in mid-August.

Aeroplan Income Fund, which owns 14 percent of the Aeroplan Limited Partnership frequent flyer program, said it would distribute 6.22 Canadian cents for each unit on Aug. 15, covering the June 29 to July 31 period.

That represents a monthly cash distribution of 5.83 Canadian cents a unit, the fund said.

Air Canada parent ACE Aviation Holdings Inc. owns the rest of Aeroplan LP.

The Aeroplan spinoff, the first by a major airline of its loyalty plan, set the program's market value at about C$2 billion ($1.6 billion).

Aeroplan Income units were off 17 Canadian cents at C$12.33 on the Toronto Stock Exchange on Friday afternoon. ACE Aviation shares were down 59 Canadian cents or 1.4 percent, at C$40.30.

($1=$1.22 Canadian)

Etihad Airways is starting Abu-Dhabi to Toronto service visa Brussels on Oct 31 2005, 3 times a week.
Now maybe AC and Emirates will wake up.

Air Canada has no ability to fly the Dubai route right now. They'll most likely have to put an A340 for the route, or fly a Boeing / Airbus jet and stop in Europe for refueling.

AC seems to be aggressively expanding its Asian and South American routes right now, and the Middle East is not a top priority.

Air Canada Flight Skids to a Stop
Josh Pringle
Tuesday, July 26, 2005 2:40 AM

An Air Canada pilot aborted take-off last night after an engine warning light came on at the Ottawa International Airport.

The airline says the Ottawa to Vancouver flight was almost at takeoff speed more than halfway down the runway when the pilot noticed the light and rejected take-off.

Passengers say the pilot came on the intercom immediately after braking, announced he lost the engine and apologized.

The heat generated by the braking was so intense, that all the aircraft's tires were shredded.

None of the 120 passengers onboard were injured.

ACE might sell part of repair unit following U.S. merger
Chris Sorensen
22 July 2005
National Post

Air Canada could be gearing up to sell part of its aircraft maintenance division following the merger of US Airways and America West Airlines scheduled to be completed this fall, an analyst says.

"Management have indicated that they will take a closer look at spinning off this unit once this deal closes," said Fadi Chamoun, an analyst at UBS Investment Research, who recently met senior management at the airline and its parent company ACE Aviation Holdings Inc.

This year, ACE revealed it had promised to invest US$75-million in the newly merged U.S. airline, to be called US Airways, in exchange for commitments for $1.5-billion worth of outsourced aircraft maintenance, repair and overhaul contracts to Air Canada Technical Services (ACTS) over a five-year period. The deal is expected to create about 700 jobs at ACTS.

Mr. Chamoun said the merger's success is key to a sale because the resulting contracts will reduce ACTS' reliance on Air Canada, which accounts for about 70% of its business.

Laura Cooke, a spokesman for Air Canada, said the airline's policy is not to comment on analyst reports, but noted that the company's stated goals are to maximize the value of its various operating units.

ACE Aviation recently raised $250-million by converting 12.5% of Aeroplan into an income trust, and several analysts have speculated ACTS is next in line to be presented to investors.

Horst Hueniken, an analyst at Westwind Partners, said another reason ACE needs to wait until the US Airways-America West merger closes is because it's not yet clear whether ACTS will perform the outsourced work at its Canadian bases or will buy some of the U.S. carriers' facilities.

He noted that Robert Milton, ACE chief executive, has expressed interest in buying the maintenance assets of distressed U.S. airlines.

Doug Parker, chief executive of America West, offered reassurances yesterday the merger was going forward.

"Our proposed merger with US Airways is well on track, with $565-million of committed equity, Department of Justice approval and teams from both companies working diligently on integration," Mr. Parker said in a statement.

ACTS has taken other steps in recent months to raise its profile as a stand-alone business.

In late March it signed a five-year deal worth $300-million with Delta Air Lines Inc. to service Delta's fleet of 208 Boeing 757 and 767 jets. The work began in May and was expected to create as many as 300 jobs at the company's base in Vancouver.

As well, the division has created its own Web site and branding campaign in an effort to attract new customers. In addition to Air Canada and its regional subsidiary, Jazz, ACTS does work for 80 customers including JetBlue Airways, United Airlines, Mexicana and the Department of National Defence.

ACTS earned $18-million on sales of $184-million in the last three months of 2004.

Westwind's Mr. Hueniken said it's possible ACTS could double its annual revenue as a result of the US Airways-America West deal.

WestJet sets flight bold new campaign
Also beefs up routes: Major drive to entice business travellers in 'Eastern Triangle'
Chris Sorensen
28 July 2005
National Post

Air Canada passengers flying through Toronto's Pearson International Airport might notice something unusual about the airline's departures and arrivals area in the palatial Terminal 1 -- giant billboards that trumpet the comfort and convenience of rival WestJet Airlines Ltd.

The bold ad campaign is part of a massive push by the Calgary-based low-cost carrier [which operates out of Terminal 3 in Toronto] to boost its presence in Eastern Canada following Jetsgo's abrupt collapse in March.

WestJet said yesterday it was adding more flights between Toronto and Vancouver and better flight times between the cities that comprise the so-called Eastern Triangle: Toronto, Montreal and Ottawa. The routes are viewed as key to capturing the business travel market, which has traditionally been dominated by Air Canada.

"We are very excited to offer Torontonians a more convenient schedule when travelling with WestJet," said Sean Durfy, the airline's executive vice-president of marketing and sales, in a statement.

But while WestJet is positioning itself to steal passengers from its competitors in Canada's largest city, some observers are wondering whether the airline's push into Central and Eastern Canada, where the former Jetsgo's operations were concentrated, is a case of too little, too late.

"Nothing is ever permanent, but as far as we are seeing now, WestJet appears to have missed an opportunity," said Nadi Tadros, an analyst at Desjardins Securities, referring to the gaping hole left by Jetsgo when it suddenly stopped flying on March 11 and filed for bankruptcy protection.

Mr. Tadros released a research note this week that showed that Air Canada added 916 flights to its domestic schedule since March while WestJet added just 137. Before its collapse, Jetsgo operated about 814 weekly flights, according to the survey.

That means Air Canada managed to capture five percentage points of Jetsgo's 7% market share while WestJet took just one percentage point, the report said. Moreover, the report noted that Air Canada's biggest gains came in Eastern Canada, where it has historically been the dominant carrier, although it also made gains in B.C. and the prairie provinces, WestJet's backyard.

"Air Canada appears to have filled the void," Mr. Tadros wrote. "(It) has added flight frequencies more broadly across the country than either WestJet or CanJet, gaining market share in every geography."

In other words, WestJet fought the war against Jetsgo only to see the spoils go to its main rival -- at least for the time being.

WestJet executives were not available for comment yesterday, but the airline said in a release it hoped to "develop Toronto as a centre for WestJet's domestic and transborder operations."

The airline also said it was planning to fly Toronto-Las Vegas and extend its summer service between Toronto and Charlottetown -- a route that Air Canada recently abandoned during the winter months because of a spat with the government of Prince Edward Island.

As well, Mr. Tadros acknowledged there is more than one way to measure the relative gains made by each airline. For example, Air Canada's post-restructuring business plan has called for more smaller jets flying more routes between more Canadian cities.