Air Canada Loses $81 Million Across First Quarter

Daniel Fowkes
03 May 2024
· Airlines 
An Air Canada Airbus A220-300 in Montreal

Air Canada has published its first quarter 2024 results, which saw larger-than-expected losses like other leading carriers.

In Q1, Air Canada said it lost C $81 million due to increased costs across its operations.

The quarter saw operating revenues of 5.2 billion, which represented a 7% increase year over year, where operating income also equated to 11 million.

Additionally, Air Canada said that despite its losses, the quarter was solid, with strong performance that transported 11 million passengers. Operations further improved with a 13% increase in system-wide on-time arrivals.

Air Canada believes improving its operational reliability will be incredibly important as it moves into the summer schedule. The summer season is arguably the busiest and most critical time to ensure smooth operations.

More 737 MAXs Needed

Air Canada also used the first quarter results to discuss its future outlook, focusing on its fleet.

The airline said it was looking to lease additional Boeing 737 MAX jets to help cover for expected capacity.

Air Canada will look to lease additional Boeing 737 MAX jets to help cover for forecasted demand increases.

The leasing of these 737-8s would see delivery occur towards the latter stages of 2024, permitting contracts to be signed. Once a reconfiguration is completed, they will enter service formally in 2025.

More and more airlines are moving towards the leasing market to cover short-term forecasted capacity increases. Additionally, with persistent delays in acquiring new aircraft, leasing is a way to get appropriate cover sooner rather than later.

An Industry-wide Problem

Most of Air Canada’s recorded losses stem from increasing operating costs plaguing the broader aviation industry.

Several other leading airlines have reported first-quarter losses. Although this period of the year is typically slower, the losses have all been higher than expected.

As airlines battle to grow, their operation costs rise. Away from natural increases in operating, airlines have rectified pay disputes with employees, which have left wage bills higher than in previous years.

These companies that have rectified pay disputes will now be forced to identify ways to cut costs and re-evaluate their employee base. Air Canada is one of the latest airlines to see its quarterly results affected by wage increases.

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