Air Canada's response . . . . . . .
Air Canada Notifies Boeing of Aircraft Order Cancellation Following Results of Pilot Vote
MONTREAL, June 18 /CNW Telbec/ - Air Canada said today that it has been
informed by the Air Canada Pilots Association (ACPA) that the tentative
agreement on costs and other issues relating to the Boeing order has been
rejected by the union membership. ACPA leadership had recommended ratification
of the tentative agreement which had been negotiated with the assistance of
Mediator Mr. M.G. Mitchnik. The Company accepts the pilots' decision and has
notified Boeing of the order cancellation.
The agreement with Boeing announced April 25 was subject to the
successful completion of certain conditions including the negotiation of
satisfactory terms by the airline with its pilots. The order is subject to
cancellation without penalty.
"We are naturally disappointed at having to cancel the wide body aircraft
order but these aircraft can only be brought into our fleet on a pre-
determined economic basis. Despite best efforts on the part of ACPA, the
agreement has been rejected," said Montie Brewer, President and CEO of Air
Canada. "Following a successful restructuring, Air Canada has been transformed
into a viable carrier. We cannot lose sight of the effort it took to get to
where the airline is today and while the cancellation of this aircraft order
will be disappointing to our employee group at large, including many of our
pilots, it is the right decision given the circumstances.
"The cancellation of the order is not material to our business plan over
the next few years. There is no longer a requirement for a cash outlay to
secure the order and we will seek to find alternative aircraft (of types
covered by the current collective agreement) in the used market for the three
777-300ER aircraft contemplated for 2006 delivery under this order (two for
Q2/06 and a third during Q4/06). We will adjust our plans and it is
anticipated that the company will continue to grow on an unaltered basis. The
critical component of the Boeing order were the 787 aircraft scheduled for
delivery in 2010 and beyond to replace our Boeing 767 fleet. In time we will
re-address this requirement.
"I thank ACPA's leadership for their efforts to secure an agreement which
would have allowed us to go forward with ordering new aircraft at this time.
It is naturally my hope that in time we will find ways to bring new aircraft
into the fleet in a manner acceptable to the company and our pilots," said Mr.
Brewer.
The agreement with Boeing included firm orders for 18 Boeing 777s, plus
purchase rights for 18 more, in a mix of the 777 family's newest models: the
777-300ER, the 777-200LR Worldliner , and the newly announced 777 Freighter.
Air Canada's 777 deliveries were scheduled to begin next year with the arrival
of three 777-300ERs in 2006. The renewal plan also included firm orders for 14
Boeing 787 Dreamliners, scheduled for delivery in 2010.
Montréal-based Air Canada provides scheduled and charter air
transportation for passengers and cargo to more than 150 destinations on five
continents. Canada's flag carrier is the 14th largest commercial airline in
the world and serves more than 29 million customers annually.
Air Canada is a founding member of Star Alliance providing the world's
most comprehensive air transportation network.