Air Canada suspends service, closes stations and reduces workforce due to COVID-19

Air Canada announced Tuesday that it is indefinitely suspending service on 30 domestic regional routes and closing eight stations at regional airports in Canada.

These structural changes to Air Canada's domestic regional network are being made as a result of continuing weak demand for both business and leisure travel due to COVID-19 and provincial and federal government-imposed travel restrictions and border closures, which are diminishing prospects for a near-to-mid-term recovery.

As the company has previously reported, Air Canada expects the industry's recovery will take a minimum of three years. As a consequence, other changes to its network and schedule, as well as further service suspensions, will be considered over the coming weeks as the airline takes steps to decisively reduce its overall cost structure and cash burn rate.

As a result of COVID-19, Air Canada reported a net loss of $1.05 billion in the first quarter of 2020. The carrier has undertaken a range of structural changes:

• A workforce reduction of approximately 20,000 employees, representing more than 50 percent of its staff, achieved through layoffs, severances, early retirements and special leaves;
• The permanent removal of 79 aircraft from its mainline and rouge fleets.

Affected customers will be contacted by Air Canada and offered options, including alternative routing where available.

Spirit AeroSystems layoffs

Spirit AeroSystems, Inc. on Thursday continued its previously announced workforce reductions by issuing layoff notices to approximately 150 salaried and management workers in Wichita, Kan. In addition, a significant number of Spirit salaried employees have expressed interest in voluntary retirement and voluntary layoff programs. The company is offering a lump sum severance payment and career transition services to employees who are laid off, and a lump sum severance payment and enhanced healthcare and pension options to eligible employees who decide to participate in the voluntary retirement program.

At the same time Spirit is reducing its salaried and management population, the company is hiring several hundred more factory workers, including assembly, composite, metals and process mechanics, and quality inspectors. These company actions to balance the workforce are being taken to meet record demand from its customers, and become more competitive in a cost-sensitive environment. Spirit is already producing at record rates and ramping up for further increases later this year and in early 2014. Spirit's backlog remains robust at about $38 billion.

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