Milton is in big trouble... only got $100 million out of the $4 billion that he's asking. I am afraid more layoffs might be looming!
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Air Canada's share of aid set at C$100 million
OTTAWA, Oct 2 (Reuters) - Air Canada's (Toronto:AC.TO - news) share of the Canadian government aid package to the country's airline sector is set at C$100 million ($64 million), Transport Minister David Collenette said on Tuesday.
Collenette told reporters that the government prefers a private-sector solution to Air Canada's financial woes, beyond the aid that is part of C$160 million of financial help Ottawa has agreed to provide over the next few days.
``I think the government would prefer a private-sector solution,'' Collenette said.
He added that certain private-sector investors have expressed an interest in possibly investing in Air Canada as part of any restructuring of the airline, which is the country's biggest carrier and world number 10. Collenette declined to name the potential investors or indicate whether a restructuring would entail a move by the airline to seek court protection from its creditors.
During a bitter takeover battle for Air Canada two years ago in which Toronto conglomerate Onex Corp. (Toronto:OCX.TO - news), backed by American Airlines parent AMR Corp. (NYSE:AMR - news), made a play for the Montreal-based carrier, members of the Star Alliance aviation group such as UAL Corp.'s (NYSE:UAL - news) United Airlines and Deutsche Lufthansa AG (quote from Yahoo! UK & Ireland: LHAG.F) came to Air Canada's defense.
Air Canada won that battle, mainly through a Quebec court ruling that reaffirmed government-legislated limits on any one individual or group owning more than 10 percent of Air Canada shares or any nonresident entity from holding more than 25 percent. Air Canada subsequently took over financially insolvent Canadian Airlines.
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<font face="Verdana, Arial, Helvetica, sans-serif" size="2">
Air Canada's share of aid set at C$100 million
OTTAWA, Oct 2 (Reuters) - Air Canada's (Toronto:AC.TO - news) share of the Canadian government aid package to the country's airline sector is set at C$100 million ($64 million), Transport Minister David Collenette said on Tuesday.
Collenette told reporters that the government prefers a private-sector solution to Air Canada's financial woes, beyond the aid that is part of C$160 million of financial help Ottawa has agreed to provide over the next few days.
``I think the government would prefer a private-sector solution,'' Collenette said.
He added that certain private-sector investors have expressed an interest in possibly investing in Air Canada as part of any restructuring of the airline, which is the country's biggest carrier and world number 10. Collenette declined to name the potential investors or indicate whether a restructuring would entail a move by the airline to seek court protection from its creditors.
During a bitter takeover battle for Air Canada two years ago in which Toronto conglomerate Onex Corp. (Toronto:OCX.TO - news), backed by American Airlines parent AMR Corp. (NYSE:AMR - news), made a play for the Montreal-based carrier, members of the Star Alliance aviation group such as UAL Corp.'s (NYSE:UAL - news) United Airlines and Deutsche Lufthansa AG (quote from Yahoo! UK & Ireland: LHAG.F) came to Air Canada's defense.
Air Canada won that battle, mainly through a Quebec court ruling that reaffirmed government-legislated limits on any one individual or group owning more than 10 percent of Air Canada shares or any nonresident entity from holding more than 25 percent. Air Canada subsequently took over financially insolvent Canadian Airlines.
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<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Empress:
Milton is in big trouble... only got $100 million out of the $4 billion that he's asking. I am afraid more layoffs might be looming!
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- his own? I'd jump at the chance to do a turnaround, and I would bet a number of other, better qualified, people would as well. Onex could come onboard for 35% and run the show right now, staying in Star at that!<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Empress:
Milton is in big trouble... only got $100 million out of the $4 billion that he's asking. I am afraid more layoffs might be looming!
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Whee! 100 measly posts
Actually, CBC online is reporting that $160 million will be provided to AC almost immediately relating to the grounding of all flights from September 11 - 13/14. This to me seems fair given the events that were out of AC control. It is the 3-4 billion amount that makes my jaw drop and wonder just what AC management have been smoking.
BTW, I am still smiling over an article in the National Post this morning which talked about the way AC MLL employees in YYZ T2 treated 2 cabinet ministers and Aline Chretien at closing time the other evening. It's nice to see that we're all considered equal FFs!
BTW, I am still smiling over an article in the National Post this morning which talked about the way AC MLL employees in YYZ T2 treated 2 cabinet ministers and Aline Chretien at closing time the other evening. It's nice to see that we're all considered equal FFs!
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<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by msn:
I'd jump at the chance to do a turnaround, and I would bet a number of other, better qualified, people would as well.</font>
How much are they paying Milton?<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by msn:
I'd jump at the chance to do a turnaround, and I would bet a number of other, better qualified, people would as well.</font>
Exactly. And if the lounge had remained open, then the press would have jumped on AC for trying to curry favour with the PM and cabinet ministers. Or if the cancelled flight had gone out with just them on board, similar stories. By the way, the reported kept on calling it the First Class Lounge. When will these turkeys get it right?
As noted, this is only the first of several measures from the government, and covers the couple of days all airlines were grounded. As for a "private sector solution", dream on...
As noted, this is only the first of several measures from the government, and covers the couple of days all airlines were grounded. As for a "private sector solution", dream on...
Quote:
<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by After Burner:
How much are they paying Milton?</font>
Don't know - but since AC still trades on US boards, there should be an SEC filing for the top 5 officers of the company.<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by After Burner:
How much are they paying Milton?</font>
I'd do it for under 1% of the stock issued, no base salary. That's incentive.
Coddling won't help airline
Don Martin
Calgary Herald
OTTAWA - The clock watchers staffing Air Canada's first-class lounge in Toronto last week probably couldn't help themselves. Enforcing minor rules arbitrarily and petty regulations religiously are attitudes deeply rooted in the airline's founding culture as a Crown corporation.
It was 11 p.m. on the dot. Time to lock up. The well-heeled customers stranded by a cancelled Air Canada flight to Ottawa last Monday -- scrubbed not for weather or safety concerns, but for being shy a minimum quota of passengers -- were told to leave for the departure gate and stew for another hour.
The lounge staff, cloaked in protective union seniority, really didn't care the weary customers looked strangely familiar, particularly the prim and proper lady with auburn hair usually seen standing beside her husband, Prime Minister Jean Chrtien.
But no bells rang and Aline Chrtien, Defence Minister Art Eggleton and Human Resources Development Minister Jane Stewart, among others, were dutifully kicked out of the lounge. A rule is a rule. This may only be a trifle, but this incident provides a searing insight into the reason Air Canada was ailing long before the big chill hit on Sept. 11.
The arbitrary cancellation of a scheduled flight without prior notice derives from the cockiness of having the largest fleet of aircraft flying a dominant schedule.
Closing the first-class lounge before the last flights have departed, a cheap perk for the premium-fare clientele the airline so desperately needs to fill the front seats, underlines the infuriating self-interest of an oh-so-smug workforce.
And to evict Canada's first lady and key Cabinet ministers on the eve of a billion-plus bailout pitch to the Prime Minister reflects a confident arrogance that Air Canada's economic importance renders it immune to any retaliatory whims.
Some insiders recognize there's a hard sell ahead, particularly after president Robert Milton's disastrous demand for a U.S.-airline-matching $4-billion bailout, which was spoonfed to national media a few days after the attacks over the objections of his own communications staff.
But the pervasive attitude of being an economic untouchable is precisely the reason why Air Canada must never, EVER be allowed back inside the protective cocoon of public ownership.
I am absolutely convinced staking a taxpayer claim on the Air Canada money pit is not the government's secret plan. It was only leaked to make a distasteful billion-dollar loan guarantee seem downright appetizing. The first step will be taken today when the airline is expected to receive a booster shot of taxpayer dollars as compensation for being grounded in the days following the terrorist attacks. So far, so good, I guess.
But in the months ahead, long-range relief may be provided if Air Canada successfully argues the fragile Canadian economy could not withstand the shock of a monopoly carrier's failure.
Sources say the government has not yet been handed a doomsday scenario if the airline is denied a bailout. They admit, however, that Air Canada could limp along for years, selling off its assets one jet at a time, cutting more planes, retreating from money-losing routes, starting a pretzels-and-pop discount service and continuing to lay off staff, which would worsen customer service. In other words, a slow, ugly, debt-ridden death.
So what's the alternative? Well, bankruptcy protection does have a bright side. It would eliminate the billion-dollar debt Air Canada inherited from the Canadian Airlines merger, which benefited the banks and nobody else. A restructuring under new ownership would shock the corporate mentality out of its lethargy. And it would undoubtedly force Air Canada into a less dominant position, allowing competition to prosper.
But there's little chance of that. The Transport Minister is determined to nurse Air Canada back to its Sept. 10 health. Off its deathbed. Back to a mere crisis.
Don Martin
Calgary Herald
OTTAWA - The clock watchers staffing Air Canada's first-class lounge in Toronto last week probably couldn't help themselves. Enforcing minor rules arbitrarily and petty regulations religiously are attitudes deeply rooted in the airline's founding culture as a Crown corporation.
It was 11 p.m. on the dot. Time to lock up. The well-heeled customers stranded by a cancelled Air Canada flight to Ottawa last Monday -- scrubbed not for weather or safety concerns, but for being shy a minimum quota of passengers -- were told to leave for the departure gate and stew for another hour.
The lounge staff, cloaked in protective union seniority, really didn't care the weary customers looked strangely familiar, particularly the prim and proper lady with auburn hair usually seen standing beside her husband, Prime Minister Jean Chrtien.
But no bells rang and Aline Chrtien, Defence Minister Art Eggleton and Human Resources Development Minister Jane Stewart, among others, were dutifully kicked out of the lounge. A rule is a rule. This may only be a trifle, but this incident provides a searing insight into the reason Air Canada was ailing long before the big chill hit on Sept. 11.
The arbitrary cancellation of a scheduled flight without prior notice derives from the cockiness of having the largest fleet of aircraft flying a dominant schedule.
Closing the first-class lounge before the last flights have departed, a cheap perk for the premium-fare clientele the airline so desperately needs to fill the front seats, underlines the infuriating self-interest of an oh-so-smug workforce.
And to evict Canada's first lady and key Cabinet ministers on the eve of a billion-plus bailout pitch to the Prime Minister reflects a confident arrogance that Air Canada's economic importance renders it immune to any retaliatory whims.
Some insiders recognize there's a hard sell ahead, particularly after president Robert Milton's disastrous demand for a U.S.-airline-matching $4-billion bailout, which was spoonfed to national media a few days after the attacks over the objections of his own communications staff.
But the pervasive attitude of being an economic untouchable is precisely the reason why Air Canada must never, EVER be allowed back inside the protective cocoon of public ownership.
I am absolutely convinced staking a taxpayer claim on the Air Canada money pit is not the government's secret plan. It was only leaked to make a distasteful billion-dollar loan guarantee seem downright appetizing. The first step will be taken today when the airline is expected to receive a booster shot of taxpayer dollars as compensation for being grounded in the days following the terrorist attacks. So far, so good, I guess.
But in the months ahead, long-range relief may be provided if Air Canada successfully argues the fragile Canadian economy could not withstand the shock of a monopoly carrier's failure.
Sources say the government has not yet been handed a doomsday scenario if the airline is denied a bailout. They admit, however, that Air Canada could limp along for years, selling off its assets one jet at a time, cutting more planes, retreating from money-losing routes, starting a pretzels-and-pop discount service and continuing to lay off staff, which would worsen customer service. In other words, a slow, ugly, debt-ridden death.
So what's the alternative? Well, bankruptcy protection does have a bright side. It would eliminate the billion-dollar debt Air Canada inherited from the Canadian Airlines merger, which benefited the banks and nobody else. A restructuring under new ownership would shock the corporate mentality out of its lethargy. And it would undoubtedly force Air Canada into a less dominant position, allowing competition to prosper.
But there's little chance of that. The Transport Minister is determined to nurse Air Canada back to its Sept. 10 health. Off its deathbed. Back to a mere crisis.
AC has posted a "Questions and answers section on Air Canadas government stabilization initiatives"
http://www.aircanada.ca/news/usa/acqa.html
http://www.aircanada.ca/news/usa/acqa.html
Dup!
[This message has been edited by Empress (edited 10-02-2001).]
[This message has been edited by Empress (edited 10-02-2001).]
Lounges should remain open until the last flight has left. Irrespective of who is there. I have NEVER experienced this on another carrier, yet I have been through this several times with Air Canada. This arrogant attitude of indiferrence can be seen at every level of the company from Milton right down to the lounge staff.
By the way, "private sector solution" may = bankruptcy. Not necessarily a bad outcome IMO. It would allow the other carriers to pick-up the profitable bits of AC.
[This message has been edited by Fly Boy (edited 10-02-2001).]
By the way, "private sector solution" may = bankruptcy. Not necessarily a bad outcome IMO. It would allow the other carriers to pick-up the profitable bits of AC.
[This message has been edited by Fly Boy (edited 10-02-2001).]
Quote:
<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Fly Boy:
Coddling won't help airline
Air Canada could limp along for years</font>
Hence the term, LimpAir. LimpJet would be the new LCC.<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Fly Boy:
Coddling won't help airline
Air Canada could limp along for years</font>
Quote:
<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Fly Boy:
Lounges should remain open until the last flight has left. Irrespective of who is there. I have NEVER experienced this on another carrier, yet I have been through this several times with Air Canada. This arrogant attitude of indiferrence can be seen at every level of the company from Milton right down to the lounge staff.
By the way, "private sector solution" may = bankruptcy. Not necessarily a bad outcome IMO. It would allow the other carriers to pick-up the profitable bits of AC.
[This message has been edited by Fly Boy (edited 10-02-2001).]</font>
<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Fly Boy:
Lounges should remain open until the last flight has left. Irrespective of who is there. I have NEVER experienced this on another carrier, yet I have been through this several times with Air Canada. This arrogant attitude of indiferrence can be seen at every level of the company from Milton right down to the lounge staff.
By the way, "private sector solution" may = bankruptcy. Not necessarily a bad outcome IMO. It would allow the other carriers to pick-up the profitable bits of AC.
[This message has been edited by Fly Boy (edited 10-02-2001).]</font>
[QUOTE]Originally posted by Fly Boy:
[B]Lounges should remain open until the last flight has left. Irrespective of who is there. I have NEVER experienced this on another carrier, yet I have been through this several times with Air Canada.[B]
As one who flew in the US much more than in Canada, I can't count the number of times I have been asked to leave the RCC, or NW's club because it is closing even though my flight departure is still way off. The club's are a business, not a right. For the sake of a few inconvenienced passengers, they should be closed.
[B]By the way, "private sector solution" may = bankruptcy. Not necessarily a bad outcome IMO. [B]
Is that why you now are a member of AA? They have their problems now - one more now that you are a COMP'd member of their program
[B]Lounges should remain open until the last flight has left. Irrespective of who is there. I have NEVER experienced this on another carrier, yet I have been through this several times with Air Canada.[B]
As one who flew in the US much more than in Canada, I can't count the number of times I have been asked to leave the RCC, or NW's club because it is closing even though my flight departure is still way off. The club's are a business, not a right. For the sake of a few inconvenienced passengers, they should be closed.
[B]By the way, "private sector solution" may = bankruptcy. Not necessarily a bad outcome IMO. [B]
Is that why you now are a member of AA? They have their problems now - one more now that you are a COMP'd member of their program