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By: - 19th June 2005 at 09:58 Permalink - Edited 1st January 1970 at 01:00
I can't understand why they ordered a large Boeing fleet in the first place when they had been acquiring Airbus 330/340s in recent years.
By: - 19th June 2005 at 11:52 Permalink - Edited 1st January 1970 at 01:00
And when they had little hope of realistically being able to afford them without the detriment of other aspects of their business.
By: - 19th June 2005 at 19:19 Permalink - Edited 1st January 1970 at 01:00
And the view from Boeing.....
Boeing Statement on Air Canada Order Cancellation
"SEATTLE, June 18, 2005 -- We share Air Canada 's disappointment at today's developments because we are looking forward to being a part of Air Canada 's vision for leadership. We are seeing very strong demand for the 777 and the 787, and we believe we will have many opportunities to place these aircraft elsewhere."
"..Air Canada's vision for leadership....." Don't you just love Managementspeak? :rolleyes:
By: - 19th June 2005 at 19:22 Permalink - Edited 1st January 1970 at 01:00
Here is Boeings Statement.
Still I don't understand the decision. :confused:
Boeing Statement on Air Canada Order Cancellation
SEATTLE, June 18, 2005 -- We share Air Canada 's disappointment at today's developments because we are looking forward to being a part of Air Canada 's vision for leadership. We are seeing very strong demand for the 777 and the 787, and we believe we will have many opportunities to place these aircraft elsewhere.
Source: Boeing.com - Boeing Statement on Air Canada Order Cancellation
By: - 19th June 2005 at 19:23 Permalink - Edited 1st January 1970 at 01:00
Damm, GA, you were faster!!!! :mad: ;) :D
By: - 19th June 2005 at 19:50 Permalink - Edited 1st January 1970 at 01:00
That's a shame to hear. I must admit though that I never quite understood this order. They already have a young fleet and their cash reserves are not that impressive.
The order will probably be renegotiated when AC is in a better shape.
This model was displayed at Le Bourget, along with models of every airline to have taken the 787 so far. Consider it a preview of massive thread(s) to come. ;)
By: - 19th June 2005 at 23:34 Permalink - Edited 1st January 1970 at 01:00
dissapointing but it happens.,!!
By: - 20th June 2005 at 01:50 Permalink - Edited 1st January 1970 at 01:00
Is there any chances Air Canada could renew the order at a later date once their problems are dealt with?
By: - 20th June 2005 at 15:10 Permalink - Edited 1st January 1970 at 01:00
yes there is..
By: - 20th June 2005 at 15:39 Permalink - Edited 1st January 1970 at 01:00
That's a shame to hear. I must admit though that I never quite understood this order. They already have a young fleet and their cash reserves are not that impressive.
IMHO it was mainly a ploy to force concessions from their employee groups, especially the pilots. AC put in the order knowing that they couldn't realisticly support the order without concessions. Even without the order AC needed concessions to stay competitive as well as balance their books a bit better. Prior to the order AC had little leverage against their employee groups/pilots. The Boeing order gave them that leverage but the pilots didn't bite the bait. With the failed concessions the order served little purpose for their future especially since it would only hurt their fragile financial situation so they cancelled the order. CO used the same tactics with their pilots but it worked for them so the 787 order stayed.
Posts: 193
By: Lawstud - 19th June 2005 at 09:08
Air Canada Notifies Boeing of Aircraft Order Cancellation Following Results of Pilot Vote
MONTREAL, June 18 /CNW Telbec/ - Air Canada said today that it has been
informed by the Air Canada Pilots Association (ACPA) that the tentative
agreement on costs and other issues relating to the Boeing order has been
rejected by the union membership. ACPA leadership had recommended ratification
of the tentative agreement which had been negotiated with the assistance of
Mediator Mr. M.G. Mitchnik. The Company accepts the pilots' decision and has
notified Boeing of the order cancellation.
The agreement with Boeing announced April 25 was subject to the
successful completion of certain conditions including the negotiation of
satisfactory terms by the airline with its pilots. The order is subject to
cancellation without penalty.
"We are naturally disappointed at having to cancel the wide body aircraft
order but these aircraft can only be brought into our fleet on a pre-
determined economic basis. Despite best efforts on the part of ACPA, the
agreement has been rejected," said Montie Brewer, President and CEO of Air
Canada. "Following a successful restructuring, Air Canada has been transformed
into a viable carrier. We cannot lose sight of the effort it took to get to
where the airline is today and while the cancellation of this aircraft order
will be disappointing to our employee group at large, including many of our
pilots, it is the right decision given the circumstances.
"The cancellation of the order is not material to our business plan over
the next few years. There is no longer a requirement for a cash outlay to
secure the order and we will seek to find alternative aircraft (of types
covered by the current collective agreement) in the used market for the three
777-300ER aircraft contemplated for 2006 delivery under this order (two for
Q2/06 and a third during Q4/06). We will adjust our plans and it is
anticipated that the company will continue to grow on an unaltered basis. The
critical component of the Boeing order were the 787 aircraft scheduled for
delivery in 2010 and beyond to replace our Boeing 767 fleet. In time we will
re-address this requirement.
"I thank ACPA's leadership for their efforts to secure an agreement which
would have allowed us to go forward with ordering new aircraft at this time.
It is naturally my hope that in time we will find ways to bring new aircraft
into the fleet in a manner acceptable to the company and our pilots," said Mr.
Brewer.
The agreement with Boeing included firm orders for 18 Boeing 777s, plus
purchase rights for 18 more, in a mix of the 777 family's newest models: the
777-300ER, the 777-200LR Worldliner , and the newly announced 777 Freighter.
Air Canada's 777 deliveries were scheduled to begin next year with the arrival
of three 777-300ERs in 2006. The renewal plan also included firm orders for 14
Boeing 787 Dreamliners, scheduled for delivery in 2010.
Montréal-based Air Canada provides scheduled and charter air
transportation for passengers and cargo to more than 150 destinations on five
continents. Canada's flag carrier is the 14th largest commercial airline in
the world and serves more than 29 million customers annually.
Air Canada is a founding member of Star Alliance providing the world's
most comprehensive air transportation network.
The statements made in this release concerning the Company's future
prospects are forward-looking statements that involve risks and uncertainties,
which may prevent expected future results from being achieved. For those
statements, we claim the protection of the safe harbour for forward-looking
statements contained in the securities laws. The Company cautions that actual
future performance could be affected by a number of factors, including
regulatory change and competitive factors, many of which are beyond the
Company's control. Therefore, future events and results may vary substantially
from what the Company currently foresees. Additional information identifying
risks and uncertainties is contained in the Company's 2004 Management's
Discussion and Analysis (MD&A) and in other filings with securities
commissions in Canada and the United States.
http://micro.newswire.ca/release.cgi?rkey=1306183496&view=13213-0&Start=0