Capacity is being cut because seats are not being sold. Even with fewer seats I think there will be plenty of award space in the back cabins. As well, it is in AC's interest to release and sell as many seats to AE as possible since it is a reliable customer. But I also agree with Academic that the higher prices for awards to cover off fees and surcharges is having an effect on how many people are redeeming miles these days. I also suspect that Canadian will retrench for the coming months and put off most optional travel until the economy improves. (Demand will remain high ex-Alberta and Saskatchewan but drop off ex-Ontario and Quebec.)