Air Canada Slashes Routes by 25% and Announces 1,700 Layoffs

Air Canada announced today it is adjusting its network under its COVID-19 Mitigation and Recovery Plan by further reducing first quarter system capacity by an additional 25 percent. As a result of these system-wide changes, there will be a workforce reduction of approximately 1,700 employees, in addition to the over 200 impacted employees at our Express carriers. The airline is working with its unions on mitigation programs.

“Since the implementation by the Federal and Provincial Governments of these increased travel restrictions and other measures, in addition to the existing quarantine requirements, we have seen an immediate impact to our close-in bookings and have made the difficult but necessary decision to further adjust our schedule and rationalize our transborder, Caribbean and domestic routes to better reflect expected demand and to reduce cash burn. We regret the impact these difficult decisions will have on our employees who have worked very hard during the pandemic looking after our customers, as well as on the affected communities,” said Lucie Guillemette, Executive Vice President and Chief Commercial Officer at Air Canada.

“While this is not the news we were hoping to announce this early into the year, we are nonetheless encouraged that Health Canada has already approved two vaccines and that the Government of Canada expects the vast majority of eligible Canadians to be vaccinated by September. We look forward to seeing our business start to return to normal and to bringing back some of our more than 20,000 employees currently on furlough and layoff,” concluded Ms. Guillemette.

Air Canada will be reducing approximately 25 percent of its planned capacity for the balance of the first quarter of 2021. With this reduction, capacity in the first quarter of 2021 will be about 20 percent of what Air Canada operated in the first quarter of 2019.

Air Canada will continue to evaluate and adjust its route network as required in response to the trajectory of the pandemic, government-imposed travel restrictions and quarantines, and to market and regulatory conditions.

Affected customers on all routes will be contacted by Air Canada and offered options, including refunds for eligible customers and alternative routings where available.

WestJet last week trimmed its capacity by 30% and laid off or furloughed 1,000 workers.

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