News

Air Canada plans low-cost subsidiary

9 Aug 2012 by BusinessTraveller

Air Canada has confirmed plans to launch a low-cost subsidiary next year, flying to destinations in Europe, the US and the Caribbean.

US media outlets including Reuters state that the Canadian airline has “overcome union resistance to the launch of a low-cost carrier”, and will start offering “cheap flights to holiday destinations” next year.

There are plans for the low-cost spin off to eventually operate up to 50 B767 and A319 aircraft, although Air Canada’s CEO Calin Rovinescu is quoted as saying that “This doesn’t happen overnight”.

Planned destinations include Europe, the Caribbean, Mexico and sun belt destinations on the US such as Florida and Nevada.

The news follows the creation of Iberia Express, a similar low-cost subsidiary launched by Iberia earlier this year (see online news March 23).

Rovinescu confirmed the plans as the carrier’s latest financial results were announced, showing a net loss of $96 million for the second quarter of 2012 compared to a net loss of $46 million for the same period in 2011.

For more information visit aircanada.com.

Report by Mark Caswell

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