Air Canada to cut 2,000 jobs
Fewer flight routes
Canwest News Service
Published: Tuesday, June 17, 2008
MONTREAL - Record high fuel prices have prompted Air Canada to trim its flight schedules and cut up to 2,000 jobs, the airline announced Tuesday.
"I regret having to take these actions but they are necessary to remain competitive going forward," Montie Brewer, Air Canada's president and chief operating officer, said in a news release. "Air Canada, like most global airlines, needs to adapt its business and reduce flying that has become unprofitable in the current fuel environment."
The airline plans to reduce total system capacity by seven per cent in the fourth quarter of 2008 and the first quarter of 2009, in relation to to the same period a year earlier. Brewer warned that if fuel prices remain at current levels, there will be further reductions in its operations.
Air Canada plans to reduce total system capacity by seven per cent in the fourth quarter of 2008 and the first quarter of 2009, said CEO Montie Brewer.
Ted Rhodes/Calgary Herald
The company says a revised fall/winter travel schedule will be available shortly.
Air Canada says every $1 increase in the price of oil per barrel adds an estimated $26 million to the company's annual fuel costs. Fuel is the carrier's single largest expense item, accounting for more than 30 per cent of total operating costs, estimated to reach close to $1 billion more in 2008 than in 2007.
"The loss of jobs is painful in view of our employees' hard work in bringing the airline back to profitability over the past four years," Brewer said.
According to the company's website, Air Canada is the 14th-largest commercial airline in the world, with approximately 23,900 full-time employees.
Last month, high fuel prices prompted the carrier to announce a fuel surcharge for most flights and create a base fee for flights to the United States.
The airline said it was imposing fuel surcharges of $20, $40 and $60 on travellers for domestic and trans-border flights, depending on the distance.
Travellers now pay $30 for medium-distance flight and $45 for long-distance flights within Canada, while a flat-rate fee of $40 attached to all flights to the U.S.
The surcharge for short flights remains the same.
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