As a new wave of lockdown restrictions sweeps across many regions in Canada, the demand for air travel continues to remain low. As a result, Air Canada has announced it will cut 1,700 jobs and cancel additional routes in an effort to reduce its operations in the new year.
The 25% contraction in the airline’s service will be in effect throughout the first quarter of 2021, and will also affect an additional 200 employees that are stationed with Air Canada’s Express carriers. The latest reduction will put Air Canada at approximately 80% below first quarter 2019 capacity levels.
Indeed, air travel in Canada has remained low even during the holiday season, which during normal years accounts for significantly higher volumes compared to the remainder of the year. According to recent data released by Statistics Canada, air arrivals from overseas countries totaled 46,600 in the fourth quarter, while average daily arrivals for December reached a total of 662.
Information for this briefing was found via Air Canada and Statistics Canada. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.