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An Air Canada Boeing 737 MAX taxies to its gate. (Photo: AirlineGeeks | James Dinsdale)

Air Canada Looking Toward Slow, Steady Recovery

More than a year into the Covid-19 pandemic, many airlines have returned to operating bolstered schedules with flights filled with passengers once again. Airports have been busy and airlines have ramped up flight schedules and opened up recruitment drives as air travel returns to a new, yet familiar normal.

The return of air travel might have been slower than initially predicted, but it has brought back much-needed earnings for several airlines as their numbers begin to improve quarter over quarter.

Montreal-based Air Canada reported its second quarter financial results on July 23, showcasing better earnings than in recent quarters amidst big losses, as restrictions began to ease and demand for air travel is slowly returning.

In the report, the airline announced improved operating revenues of $837 million, which is an increase of 59% from the second quarter of 2020. However, operating losses were still at a massive $1.13 billion, but considered an improvement when compared to $1.56 billion in the second quarter of 2020.

“The Covid-19 pandemic continued to weigh on Air Canada and the Canadian airline industry in the second quarter, with its impact on travel reflected in our results,” Air Canada President and Chief Executive Officer Michael Rousseau said in a statement.

Increased Seating Capacity

Despite passenger bookings being lower than pre-pandemic levels, the national carrier is anticipating demand for air travel to rise again in the next few months.

The easing of restrictions, such as the eliminated requirement for a quarantine period if passengers are fully vaccinated, as well as the positive increase of vaccination rates, has led to a significant increase in passenger bookings in June and July.

To cater to the anticipated demand, Air Canada made the decision to increase its seating capacity by 78%, as compared with last year’s second quarter when capacity had to be reduced by 86% from the second quarter of 2019. The airline also plans to increase its seating capacity by 85% year-over-year in the third quarter of this year.

Additional Flights

Air Canada also made plans to add to its flight schedules, having pre-planned ambitious winter schedules and peak summer schedules.

Just recently, the airline also announced its summer transborder schedule, which includes a total of 55 routes and 34 destinations within the U.S, as well as almost 220 daily flights between the U.S. and Canada.

The airline doesn’t plan to stop = there, as Mark Galardo, Senior Vice President, Network Planning and Revenue Management at Air Canada, said in a press release.

“We are planning to restore services to all 57 U.S. destinations previously served as conditions allow,” he said.

While the current demand for air travel is mainly for leisure destinations, Air Canada is looking for a much more dramatic return for overall demand in the latter part of this year.

Corporate demand is expected to increase around September to October, while demand for Atlantic destinations would increase after that as passengers would look for suns and beaches during winter.

Not Afraid of Competition

With the outlook of a good recovery, Air Canada is also stepping up to go up against increased competition from the likes of Porter Airlines, which recently announced its own expansion plans.

There is also the rise of budget carrier Flair Airlines, which planned for cheaper, no-frills flights between the U.S. and Canada, posing a threat to Air Canada as it has the ability to undercut the Canadian flag carrier on prices, attracting more passengers.

Air Canada remains unfazed and confident, however, stating that it would readily welcome healthy competition, as it says it is ready to deal with the obstacles its competitors may present.

Author

  • Fascinated by aircraft from a very young age, Charlotte’s dream was to work alongside the big birds one day. Pursuing her dream, she went on to achieve her diploma in Aviation Management and is currently working on her degree in Aviation Business in Administration with a minor in Air Traffic Management. When she’s not busy with school assignments, you can find her aircraft spotting for long hours at the airport. In Charlotte’s heart, the Queen of the Skies will always be her favorite aircraft.

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