Air Canada Expands Flight Schedule Following Union Strike

Air Canada is increasing its flight schedule today as part of its operational recovery following a three-day strike by flight attendants. The airline is prioritizing outbound international flights as it works to restore normal service. However, Air Canada has warned that it will take between seven to ten days to fully resume regular operations due to repositioning of aircraft and crew. As a result, some flights may still be cancelled until the schedule stabilizes.

Customers whose flights have been cancelled will have the option of receiving a full refund or a credit for future travel if they cannot be rebooked on another airline. The strike ended after Air Canada and the union representing over 10,000 flight attendants reached a new tentative agreement on March 5, 2024, with assistance from a federal mediator.

Implications of the Settlement

The resolution of the labour dispute has significant implications beyond the immediate return to service. The settlement appears to have ended the controversial practice of compensating flight attendants only while planes are in service. Additionally, the situation raises questions about the federal government’s ability to enforce back-to-work orders in essential industries.

Bea Bruske, President of the Canadian Labour Congress, expressed to the Canadian Press that the outcome may set a precedent for unions to challenge government mandates. She stated, “It sets a precedent for the reality that section 107 is no longer effective; it is effectively dead.” This sentiment suggests a shift in the balance of power between labour unions and government authority.

Market Reactions and Future Outlook

Despite potential increases in operational costs stemming from the new labour agreement, RBC Capital Markets has identified Air Canada as its “top investment idea.” Analysts expect a notable improvement in free cash flow for the airline in 2028 and 2029. A recent report highlights Air Canada’s strong operational performance during the year, even amidst a decline in transborder traffic, which has bolstered confidence in the airline’s management.

Furthermore, capital expenditures are anticipated to decrease in the coming years, which could enhance the airline’s financial stability. As Air Canada navigates the complexities of post-strike recovery, its strategic focus on international routes and operational efficiency will be critical.

In related business news, Target has seen its shares decline in pre-market trading following a drop in sales and profit for the latest quarter. The retailer has appointed Michael Fiddelke as its new CEO, which has not met with unanimous approval among investors, many of whom had hoped for an external candidate to lead the company.

In another development, Canaccord Genuity has announced its acquisition of Australian financial services firm Wilsons Advisory. This move marks Canaccord’s largest acquisition in a decade and is expected to enhance its global presence, although the financial terms of the deal have yet to be disclosed.

As Air Canada works to recover from the disruptions caused by the recent strike, the response from investors and the market will be closely monitored in the months ahead.