Another airline confirms new low-cost unit

Air Canada discount unit likely to launch from 2013

Air Canada is the latest airline to confirm plans to operate low-cost flights to leisure destinations. A discount unit rollout will take place from 2013, slowly becoming a 50-aircraft operation that could return the airline to profit. The news comes this week after union resistance to the launch of a low-cost carrier finally crumbled. Weak quarterly results for the second quarter appear to have persuaded all parties that a low-cost unit may be the only way to cut costs and boost revenues. Air Canada plans to pay less to pilots flying the new carrier.
One transport analyst thinks the new airline will have just three to five aircraft by the end of 2013, with 50 planes possible only at the end of decade. The new unit will fly to “sun belt” destinations in the United States such as Florida and Nevada, the Caribbean and Europe – not within Canada.
Reuters

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