Air Canada Announces 1,900 Layoffs And 25% Route Reduction; Canadian Airlines Devastated

Air Canada Announces 1,900 Layoffs And 25% Route Reduction; Canadian Airlines Devastated

January 13, 2021 Jim Byers

Hard on the heels of a similar announcement by WestJet last week, Air Canada today (Wednesday) said it’s being forced to lay off 1,900 workers and slash capacity by 25%.

Canada’s largest airline said the moves are a result of decreased travel demand brought on by COVID-19 and the ensuing quarantines and travel restrictions directed by governments in Canada and around the world.

The province of Ontario, Canada’s largest, issued a 28-day “stay at home” order on Tuesday. The order allows airlines to fly, but Canadian governments have been hammering out a “don’t travel” message for weeks.

“As a result of these system-wide changes, there will be a workforce reduction of approximately 1700 employees, in addition to the over 200 impacted employees at our Express carriers,” officials said. “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,” said Lucie Guillemette, Executive Vice President and Chief Commercial Officer at Air Canada. “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,”

That will almost certainly have a strong impact on tourism and hospitality jobs in the Caribbean, perhaps the most tourism-reliant region on the planet.

“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 per cent 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 per cent 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.

Air Canada on Tuesday said it was slashing all service in and out of several Canadian airports: Fredericton (New Brunswick), Kamloops (British Columbia), Gander (Newfoundland), Yellowknife (Northwest Territories) and Prince Rupert (British Columbia). It’s also halting service to and from Labrador, and, according to the Globe and Mail, both Comox and Sandspit, British Columbia.

Air Canada last year eliminated service in and out of Sydney, Nova Scotia and several other Canadian cities.

WestJet last week said it’s been forced to temporarily lay off 1,000 workers and cut capacity by 30% to deal with the pandemic. Combined with Air Canada, that’s nearly 2,900 jobs lost in a five-day period in the Canadian airline industry.