ISLAMABAD (PEN) : Air Canada is on the brink of suspending most of its operations, as negotiations with the pilot union face a critical deadlock over wage demands,
With nearly 670 flights operated daily by Air Canada and its low-cost subsidiary, Air Canada Rouge, the potential shutdown could disrupt travel for up to 110,000 passengers each day.
The airline’s pilots are seeking to align their salaries more closely with their U.S. counterparts, who secured high-paying labor agreements in 2023 amid a shortage of pilots and increased travel demand.
“Air Canada is hopeful that an agreement can still be reached with our pilots if the ALPA moderates its wage demands, which are significantly above the average Canadian wage increases,” said CEO Michael Rousseau.
The Air Line Pilots Association (ALPA), representing over 5,200 of Air Canada’s pilots, has not yet commented on the situation.
Despite ongoing discussions, the airline and union remain far apart. ALPA pilots have pointed out that pay rates at U.S. rival Delta Air Lines can be up to 45% higher than those at Air Canada.
TD Cowen analyst Thomas Fitzgerald acknowledged the pilots’ frustration but noted that the U.S. pilot market faces different challenges, including higher barriers to entry.
A mandated three-week cooling-off period, which began on August 27, prevents the union from striking during this time.
Should the shutdown proceed, Air Canada expects it will take seven to ten days to resume normal operations. Flights will be canceled over a three-day period, with a complete shutdown possible as early as 00:01 EDT on September 18.
The airline’s stock has already fallen by more than 18% this year. Air Canada is working with other airlines to find alternative arrangements for passengers affected by the cancellations.
