Air Canada's COVID-19 actions

[rudder]

7 minutes ago, UpperDeck said:

Like to see the FM clause in the CUPE contract which guarantees no layoffs for the term of the contract. Principle question is whether term of contract is impossible to perform. Would cost AC lots of money but is economic benefit to claiming party sufficient to warrant Force Majeure?

L60.06 FORCE MAJEURE
L60.06.01 The provisions of L60.02 and L60.03 do not apply in the case of Force Majeure. The provisions of L60.02 and L60.03 will be suspended for the period of time during which the effects of the Force Majeure have an impact, such that the targets will be adjusted proportionately to reflect the period during which they have been suspended.
L60.06.02 Force Majeure means, by way of example only and without limitation, events of the nature and scale which have a significant deleterious impact on the operation or finances of the Company, or, for the purposes of the guarantees set out in L60.03.02, on the operations or financial performance of any of its bases or the market demand for its services, on the whole, or, for the purposes of the guarantees set out in L60.03.02, at any of its bases, including: an Act of God, a strike or other labour disruption, legal or illegal, by employees employed by Air Canada or a CPA Carrier, a national emergency, the involuntary revocation of the Company’s operating certificate, a grounding of a number of the Company’s aircraft, a reduction in the Company’s operations resulting from a decrease in available fuel supply caused by either governmental action or by commercial suppliers being unable to meet the Company’s demands, the unavailability of aircraft scheduled for delivery, a severe downturn in the economy, which would include two consecutive quarters of decline in Canada’s GDP, the outbreak of war, a pandemic, a terrorist attack, or dramatic increases in the price of jet fuel, which would include an unexpected 30% year over year increase in the price.
L60.06.03 For clarity, Force Majeure does not include the price of fuel, except as described above, or other supplies, the price of aircraft, a downturn in the economy short of severe, the financial state of the Company, or the relative profitability or unprofitability of the Company’s then-current operations, unless any of these circumstances is related to a Force Majeure event as defined herein.

[UpperDeck]

Thank you, Rudder. Not much more to be said on THAT subject....lol

[boestar]

If anyone thinks that any airline would survive this without laying off staff they are living in a fantasy world.  You cannot pay staff for nothing and expect to survive. 

These are exceptional circumstances and we are all in this together.  Suck it up and wait it out.

[Geminoid]

So the news has been reporting layoffs of 5000 AC flight attendants, including ALL Rouge flight attendants.  What's happening to pilots?  Ramp rats?  Customer service staff?  No planes to fly, or load, or process boarding.

[mrlupin]

The other unions simply have not chosen to tell the media until AC makes their announcement.

[conehead]

59 minutes ago, mrlupin said:

The other unions simply have not chosen to tell the media until AC makes their announcement.

Any layoffs in Maintenance yet?

[boestar]

1 hour ago, conehead said:

Any layoffs in Maintenance yet?

This is actually the perfect time for maintenance to catch up on deferred maintenance and MEL's

 

[conehead]

44 minutes ago, boestar said:

This is actually the perfect time for maintenance to catch up on deferred maintenance and MEL's

 

I agree, but Calin has stated he’s looking for $500,000,000 in savings. There will be layoffs.

[rudder]

8 minutes ago, conehead said:

I agree, but Calin has stated he’s looking for $500,000,000 in savings. There will be layoffs.

Well, I know one way to preserve $720MM in cash.....

[MD2]

On 3/16/2020 at 2:36 PM, dagger said:

No idea, frankly, but it may be wrapped into a bailout of the industry - AC takes it on, gets some credit for it.

Personally, I believe that deal is dead or at least will be reopened and with a bail-out of sort involved, there are other airlines that can do that.

[dagger]

32 minutes ago, MD2 said:

Personally, I believe that deal is dead or at least will be reopened and with a bail-out of sort involved, there are other airlines that can do that.

Which other airlines do you have in mind? Seriously, which other airlines do you think can do that.

[Guest]

Air Canada to Operate Special Flight from Morocco to Bring Canadians Home

Provided by Air Canada/CNW

• First of a planned series of flights to assist Canadians returning home

MONTREAL, March 20, 2020 /CNW Telbec/ – Air Canada announced today that the airline, in collaboration with the Government of Canada, will operate a special flight March 21 from Morocco to bring Canadians home.

“We understand it’s a challenging time for all Canadians who are still abroad and anxious to come back home. Our teams are working around the clock with the Canadian Government and offering our global reach to do everything we can to repatriate as many Canadians as possible, recognizing that we will not be able to assist all,” said Calin Rovinescu, President and Chief Executive Officer of Air Canada.

Air Canada will operate a wide body aircraft, with 450 seats, from, Casablanca, Morocco to Montreal. Global Affairs Canada is coordinating local arrangements for Canadians wishing to return home.

“We are doing everything possible to assist Canadians abroad to return home and we appreciate the support of Air Canada, which is providing its technical and operational expertise to help us. It is an excellent example of the type of cooperation and support the Government of Canada is encouraging in the face of this unprecedented public health crisis,” said the Honourable François-Philippe Champagne, Minister of Foreign Affairs.

The Canadian Government has also announced that it will provide financial assistance for Canadians abroad directly impacted by the COVID-19 outbreak to help secure their return.

It is important for those travelling to be reminded that only Canadian citizens, permanent residents and members of their immediate family holding a valid travel document will be permitted to board these flights to Canada. All passengers will undergo a health screening before boarding the aircraft. Any passenger presenting symptoms consistent with COVID-19 will be denied boarding unless they can present a medical certificate confirming any symptoms are not related to COVID-19.  Upon arrival in Canada, all passengers will be requested to self-isolate for a period of 14 days.

[conehead]

That’s an odd rendezvous point.

[Guest]

23 minutes ago, conehead said:

That’s an odd rendezvous point.

Thousands of Canadians are stranded in Morocco, many uncertain as to when and how they’ll get home. Flights out of the North African kingdom have slowed to a trickle after the government there halted international travel in and out of the country due to the novel coronavirus outbreak.

According to an email from Global Affairs Canada, there are currently more than 4,468 Canadians in Morocco who have registered with the voluntary Registration of Canadians Abroad service. “Limited flights are currently still available,” the federal department insists, “and may be offered on some airlines later this week.

“We are actively doing all we can to assist Canadians currently in the country,” it added, cold comfort to those looking for help and unable to find any.

The Canadian embassy in Morocco, meanwhile, tweeted that all international flights will be suspended by the Moroccan government on Thursday.

For Ottawa’s Grace Welch, that means her holiday now largely consists of staying in her hotel in Marrakech, on her laptop, trying to find a flight out. She has an EasyJet flight to London booked for Friday, but she suspects that may now be cancelled, leaving her with nowhere to go or stay. In the meantime, restaurants and cafés in Morocco have closed, although hotel food service and supermarkets remain open.   https://ottawacitizen.com/news/local-news/stranded-in-morocco-many-ottawans-are-uncertain-as-to-when-and-how-theyll-get-home

[conehead]

Wow, thanks Malcolm.  I had no idea there were so many Canadians in Morocco.  Now I’m wondering why...

[Guest]

15 minutes ago, conehead said:

Wow, thanks Malcolm.  I had no idea there were so many Canadians in Morocco.  Now I’m wondering why...

Great tour destination?  or 

Quote

Moroccan Canadians are Canadians of Moroccan descent or Morocco-born people who reside in Canada, as well as people from the state of Morocco who are ethno-linguistic and religious minorities. According to the 2011 Census there were 71,910 Canadians who claimed full or partial Moroccan ancestry, an increase compared to the 2006 Census.^[1]

 

[j.k.]

Transat just gave 30 day notice to all of their pilots.

[MD2]

23 hours ago, dagger said:

Which other airlines do you have in mind? Seriously, which other airlines do you think can do that.

Not too hard to perceive using one's imagination. Airlines with the lowest cost and more extreme measures to preserve cash on this side will be able to help consolidate the market on the other side. It was one thing for Air Canada to propose to purchase Transat on its own dime, which still created some questions around capacity and its dominant position on certain routes and airports, it's quite another to propose to do the same on a bail-out. Depending on the position in which Transat will find itself financially on the other side, and especially if the purchase is with some public bail-out money, likely there will be other interested parties. That's all. 

[dagger]

7 hours ago, MD2 said:

Not too hard to perceive using one's imagination. Airlines with the lowest cost and more extreme measures to preserve cash on this side will be able to help consolidate the market on the other side. It was one thing for Air Canada to propose to purchase Transat on its own dime, which still created some questions around capacity and its dominant position on certain routes and airports, it's quite another to propose to do the same on a bail-out. Depending on the position in which Transat will find itself financially on the other side, and especially if the purchase is with some public bail-out money, likely there will be other interested parties. That's all. 

Historically, the Canadian government has never ponied up the kind of big bailout cash for airlines that the US does, and will. We already see United, for example, jockeying for cash, telling employees they may be laid off if the government doesn't come up with a big bailout. Now ask yourself, if UA gets a lot of cash, without strings, is it really going to keep on the 70% of its staff with nothing to do? That would be an extraordinarily stupid use of bailout cash because if this proves to be a long slow recovery, the airline would run out of cash paying tens of thousands of employees over months to stay at home. So linking continued employment to a bailout is BS. That why Canadian carriers are moving aggressively on layoffs, likely work sharing for the rest, etc. They know the government isn't going to make them whole. This will be a substantial money losing year for all Canadian carriers, no matter what relief they get from the feds. In all likelihood, the help that comes will be in any form but no-strings cash. It might be loans, deferrals, perhaps rebates that convert into tax liabilities that will reduce future profitability, etc etc. Its unlikely that airlines will get enough help to make them attractive for a takeover, just less of a dog under current circumstances. 

By the way I love our airlines, but I subscribe to the notion that sometimes, because of crappy factors like pandemics or volcanoes or terrorists, airlines will have bad years financially. That's the nature of the business. The government in this case should probably offer help, but not so much to make up for all the lost profitability. There will be very good years ahead, there is going to be a lot of pent-up demand to visit relatives and be tourists again, and all those business conferences and trade shows will be much more useful to go to for having been cancelled in 2020. And while some people are obviously being hurt financially, a lot of others have nothing to spend money on - prime candidates to reward themselves with a trip once things move back towards normal. Remember, the 1918-19 Spanish flu was followed by the Roaring Twenties. That's why I think the massive bailouts US airlines want - and may get - are nuts. Let the money go to people, let the airlines have enough to stay solvent and solid with the expectation that they will make back all their losses - and more - starting next year.

[Turbofan]

AC pilot MOA

6 months

- 162 furloughed.  Given notice today.

- Up to a maximum of 600 more layoffs depending on Retirement incentive uptake.

- No lay-off until May 1

- Early Retirement incentive offer to 500 pilots

- 55 hours per month

 

 

[neverminds]

And Rouge pilots get paid at mainline rates even though the majority of their aircraft(maybe all) are parked.

Between Idle Rouge pilots  being paid at 55 hours a month at mainline rates and Idle Max pilots being paid at 70 hours, Air Canada must have the most expensive inactive rosters in the history of aviation 

[conehead]

12 hours ago, neverminds said:

And Rouge pilots get paid at mainline rates even though the majority of their aircraft(maybe all) are parked.

Between Idle Rouge pilots  being paid at 55 hours a month at mainline rates and Idle Max pilots being paid at 70 hours, Air Canada must have the most expensive inactive rosters in the history of aviation 

Yeah, that’s gonna be a drain on resources.

[mrlupin]

That doesn't sound right... AC is going to bleeding $$, and it will keep most of it's pilots while sending half of flight attendants on off duty status?

 

Maybe that's just round 1?

Who knows at this point, if the numbers keep increasing, it would not be surprising to see a stop to all air travel for a period of time.

[rudder]

18 minutes ago, mrlupin said:

That doesn't sound right... AC is going to bleeding $$, and it will keep most of it's pilots while sending half of flight attendants on off duty status?

 

Maybe that's just round 1?

Who knows at this point, if the numbers keep increasing, it would not be surprising to see a stop to all air travel for a period of time.

It is a math exercise.

Quantify the gross payroll reduction from the ACPA MOA. Add in what the retraining cost of implementing a pilot reduction bid would be. That is what AC has effectively saved.

Same exercise going on with other labour groups. CUPE laying off 50% of most junior FA’s (including all of the lower paid Rouge FA’s) does not reduce FA payroll by anywhere close to 50% due to demographics of remaining FA’s and their actual pay rates.

AC seems to be hoping for a maximum 6 month peak crisis. That may be optimistic but it seems reasonable based on current information.

[boestar]

AC also needs to be able to react should this thing settle down faster than expected.  Getting rid of everyone means weeks to get the fires going again as opposed to days if they keep people on ready to go.