900 New jobs at Air Canada LCC

[flatface]

Deleted

[navajo_jay]

http://www.theglobeandmail.com/report-o ... le4557500/

Air Canada says it will hire about 400 flight attendants and some 500 airport customer service agents and baggage handlers.

In addition to the hires at the main airline, the company says it will hire about 150 flight attendants and 50 pilots for its low-cost airline – which is slated to launch in 2013.

[scopiton]

Jobs in the oil patch and other sectors continue to lure away workers.

god damn oil, it will always be a problem for AC.....

ooops, 50 pilots only ? looks like those who recently signed a contract may see the terms change.
just sayin'

[Fanblade]

ooops, 50 pilots only ? looks like those who recently signed a contract may see the terms change.
just sayin'

Startup with 6 319's was always the stated plan. 767 introduced in 2014 as 787 arrives.

10 aircraft after year one. 50 after year 5.

The pilot numbers look reasonable to me for the initial 6 fins.

If ur interested apply. They will go junior at those pay rates.

On the pay scale the next pay increase for this EMJ FO is 320 FO or 767LCC CA. Go figure.......

Just sayin'

[scopiton]

They will go junior at those pay rates.

you bet.

will the LCC generate enough money when the time to pay the check to boeing comes ?
go p.12, under section 6, and read the commitments and contingencies.

http://www.aircanada.com/en/about/inves ... FSN_q2.pdf
all numbers are in $ millions.

Ac has a capital commitment to boeing of $894 for 2014. $596 in 2013.
Principal and interest rates repayment on the long term debt and finance lease of $1,429 in 2015. $603 in 2013
compared to December 2011, in June 2012 Ac reduced its debt from $3,906 to $3,773. p.10 that's $133 less, even if it used $238 in cash to pay for it. if I'm not wrong. It would worth checking last year's report but I feel lazy.
may be the interest rate is high, S&P gave a BBish to air canada's credit rating.

and we all know that in 2014 comes the end of the agreement signed with the government about the retirement funding.

to summarize, Ac's repayments and financing obligations will increase a serious notch in the next 2/3 years, and lets keep in mind they posted an operating loss of 93 millions for the 6 month ending of 2012...

no wonder why they fought hard on the contracts, and why they're all in with this Lcc.
2013/16 will be interesting.
go figure...

[vic777]

Ac has a capital commitment to boeing of $894 for 2014. $596 in 2013.

This will absolutely be no problem if Obama gets reelected, with QE3 a done deal we're looking at Obama going to infinite Quantitative Easing ... the American Dollar will soon be worthless. Unless of course Canada goes the way of Europe. The only hope for an America led by Obama is Worldwide Collapse. Can Obama pull it off? (of course AC has probably got the same guy playing the currency market as they do buying Oil futures)

[Max_Diff]

LCC or not....AC will be claiming bankruptcy within 2 years. Its a done deal.

[ratherbee]

How many times have I heard "its a done deal"?

Loads are up, yields are up, CND$ is up, labour contracts are done, cash reserves are well over $2B and the pension payments are managable (assuming the Feds agree to extend funding restrictions). The stock price has climbed steadily since our contract was finally settled. AC has productivity gains and flexibility to protect their network and our jobs. We are hiring. Looks like there will be lots of work for all of us including Jazz and the other CPA carriers.

Nope, bankruptcy for AC is far less likely today than it has been for more than a decade.

[Norwegianwood]

Nope, bankruptcy for AC is far less likely today than it has been for more than a decade.

Where have I see these words before? Oh I remember, it was 100 years ago when the Titanic was labeled "unsinkable"

[hithere]

The only way you would see AC enter bankruptcy again is if they dont get the extension on pension relief. there are several other large Canadian corporations seeking similar pension relief.There is no way Harper wants all these CCAA filings under his watch so its a only a matter of time before he agrees to an extension on the pension relief

[Hadji Ramjet]

If LCC is separate and AC goes back into CCAA, could they not just shovel all the work over to LCC?

[flytdeck]

If LCC is separate and AC goes back into CCAA, could they not just shovel all the work over to LCC?

Almost exactly right. It was a bit of a surprise to see LCC fall under Air Canada ownership, but in the short term, it makes a lot of sense. A quick review of Air Canada development for the past 15 years would indicate the following may occur.

• Evolve LCC using Air Canada resources until sustainable as an entity.
• Split LCC from the mainline (like Aeroplan) as "releasing hidden value"
• Devolve AC until unsustainable, then demolish (handily eliminating pension and other obligations)
• Reward executive management with an obscene bonus for successfully "eliminating" the debt burden

The LCC will have a struggle on domestic routes though possible a bit more success on international destinations. The problem will be competing with the emerging mega-carriers in the Middle East.

The key will be to reduce costs as much as possible except, of course, at the senior management level. AC shares may be an interesting play up until the time the LCC is severed then, once the "hidden value" is released, they will likely be junk.

In the long run, the employees who have made a career at Air Canada will be those most affected. As the saying goes; "Hope for the best but plan for the worst".

[ratherbee]

Not close to being right.

As long as AC avoids CCAA, then our contract is in force. Read the preamble to the LCC LOU. It ties the LCC to our contract and scope clause. I was told this language was written by our in-house lawyer who recently quit because our leaders ignored his advice during FOS.

The biggest risk to our careers is another CCAA. I didn't like the last one too much, you? So the idiots who are stilling booking off, taxing slow, and using red pens need to give their heads a shake. Their stupid actions take us closer to CCAA where all bets are off and the Company can open up our contracts - like last time in "03 and "04.

For those who think that we can buy the airline and give ourselves pay raises, well all I can say is get outside and get some fresh air.

[Old fella]

OK you Air Canada people, what is this new LCC gonna do for me(as a fare paying dude) that I can't get on your airline now. I recently booked to YYZ from the Maritimes with you and it cost just under $800.00 for 2 return and that includes all charges/tax/NC fee and the like. That's very good in my books, can't see your airline doing any better than that. Matter of fact, if you shop carefully AC has beaten Porter on fares running into YTZ........

Now I can be cynical and crusty(and I am) so the aim is to pay you guys/gals less, charge me more while adding significant $$$$ to the coffers of your overpaid top end suits who run the outfit but will still call it LCC.

[scopiton]

Loads are up, yields are up, CND$ is up, labour contracts are done, cash reserves are well over $2B and the pension payments are managable (assuming the Feds agree to extend funding restrictions). The stock price has climbed steadily since our contract was finally settled. AC has productivity gains and flexibility to protect their network and our jobs. We are hiring. Looks like there will be lots of work for all of us including Jazz and the other CPA carriers.

Nope, bankruptcy for AC is far less likely today than it has been for more than a decade.

you're correct ratherbee, those numbers are encouraging.
however debts represent 140% of total assets, cash flow represents only 6% of total debt, and free cash flow is only 235m$, which mean the company doesn't generate much cash in itself once everything is paid.
Cash and cash equivalent are pretty high as you said, but compared to the operating expense on the first 6 months it doesn't represent much. workforce salary for this period for instance is around 1b$ and total operating expenses are close to 3bn.
payments of interests on the long term debt represent 32% of Earning before interests and taxes and aircraft rental.

AC used all the leverage it could to borrow money and it looks like this debt isn't producing much value for now and therefore is very expensive.

in the end, I guess the most important is to be able to pay the bills.

[Mig29]

Rick said it best under 2 minutes!!

[Bede]

How will this LCC be different than the LCC carriers tried before (Tango and Zip)? I know it's vacation flying, but the domestic thing didn't work out before, I have my doubts on this one.

[TKTguy]

Join the club Bede

[yycflyguy]

How will this LCC be different than the LCC carriers tried before (Tango and Zip)? I know it's vacation flying, but the domestic thing didn't work out before, I have my doubts on this one.

It has nothing to do with sustainability. It is a tool to transfer legacy costs to a LCC model piece by piece. The E175s are gone after only 2 months of the FOS taking effect. AC will be a shell of itself in a couple of years.

[Mig29]

How will this LCC be different than the LCC carriers tried before (Tango and Zip)? I know it's vacation flying, but the domestic thing didn't work out before, I have my doubts on this one.

It has nothing to do with sustainability. It is a tool to transfer legacy costs to a LCC model piece by piece. The E175s are gone after only 2 months of the FOS taking effect. AC will be a shell of itself in a couple of years.

I agree. It gives AC legal authority to screw with anyone's contract and get around any obstacles as they fit, in order to be "competitive" in providing dividends and bonuses to upper management and shareholders.

It's got nothing to do with being really competitive with other carriers and providing "improvements" to the flying public.

[Wheels]

How will this LCC be different than the LCC carriers tried before (Tango and Zip)? I know it's vacation flying, but the domestic thing didn't work out before, I have my doubts on this one.

The difference is that this time around AC isn't trying to run a low cost model with high cost employees shackled down with pensions and strict work rules. The new LCC allows them to operate even cheaper than the SunWings, Transats and especially West Jet.
Watch in the coming years as more and more work is removed from mainline and shelled out to Sky Regional and the LCC.

[mbav8r]

Anyone know if any other group has a "scope" on AC flying or will they be paying 22,000/yr for flight attendants at the LCC?

[yycflyguy]

Anyone know if any other group has a "scope" on AC flying or will they be paying 22,000/yr for flight attendants at the LCC?

CUPE did not get the right to follow work in their arbitrated agreement. The intent is to hire off the street so your salary range for FAs is ballpark.

[Old fella]

Anyone know if any other group has a "scope" on AC flying or will they be paying 22,000/yr for flight attendants at the LCC?

CUPE did not get the right to follow work in their arbitrated agreement. The intent is to hire off the street so your salary range for FAs is ballpark.

.

You can't be serious. That is $10.00 per hr call-center wages.... then again some will be attracted to it due travel benefits(passes I assume). Bet employee turnover will be high - like call centers.

[yycflyguy]

Anyone know if any other group has a "scope" on AC flying or will they be paying 22,000/yr for flight attendants at the LCC?

CUPE did not get the right to follow work in their arbitrated agreement. The intent is to hire off the street so your salary range for FAs is ballpark.

.

You can't be serious. That is $10.00 per hr call-center wages.... then again some will be attracted to it due travel benefits(passes I assume). Bet employee turnover will be high - like call centers.

Yup. That's the idea.