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Air Canada Slashes First Quarter Capacity

In the face of continued quarantines and travel restrictions, the carrier says it plans to operate at just 20 percent of its 2019 levels

January 19, 2021

Air Canada says it is cutting its planned first quarter capacity by another 25 percent, meaning the carrier will only operate around 20 percent of capacity in the first quarter, compared to 2019 levels.

The airline also announced further reductions in its workforce of around 1,700 employees, in addition to over 200 impacted staff at its Express carriers.

The cuts are coming as the result of “new pre-departure testing requirements, provincial lockdowns and travel restrictions,” according to the carrier.

Earlier this month, the Canadian government announced it would require all arriving air passengers to produce a negative COVID-19 test result taken within 72 hours prior to departing for Canada. The government emphasized that new testing requirement is in addition to – and not a substitute for – the current 14-day mandatory quarantine.

“Since the implementation by the Federal and Provincial Governments of these increased travel restrictions and other measures, in addition to the existing quarantine requirements, we have seen an immediate impact to our close-in bookings and have made the difficult but necessary decision to further adjust our schedule and rationalize our transborder, Caribbean and domestic routes to better reflect expected demand and to reduce cash burn,” said Lucie Guillemette, executive vice president and chief commercial officer at Air Canada.

“While this is not the news we were hoping to announce this early into the year, we are nonetheless encouraged that Health Canada has already approved two vaccines and that the Government of Canada expects the vast majority of eligible Canadians to be vaccinated by September,” Guillemette said.

“We look forward to seeing our business start to return to normal and to bringing back some of our more than 20,000 employees currently on furlough and layoff.”

Air Canada assured customers that any affected ticket holders would be contacted and offered options including “refunds for eligible customers and alternative routings where available.”

The carrier added that it would “continue to evaluate and adjust its route network as required in response to the trajectory of the pandemic, government-imposed travel restrictions and quarantines, and to market and regulatory conditions.”