Economy

Air Canada adjusted earnings soar above estimate, revenue up in each segment

Air Canada adjusted earnings soar above estimate, revenue up in each segment”

Southwest Airlines announced in its second-quarter earnings that it would "proactively extend the MAX-related flight schedule adjustments through January 5, 2020, to provide reliability of our operation and dependability for our customers booking their fall and holiday travel".

Other airlines have taken major hits to earnings due to the MAX grounding.

Air Canada will continue to support Boeing despite the issues with the Max fleet, the executives said.

The grounding has forced carriers worldwide to cancel thousands of flights and adjust their schedules just as they were preparing for the peak summer travel season.

"Ideally, we are still looking forward to the return to service", Rousseau said.

Sorohan declined to comment on the likelihood of disruption in coming weeks, but described the timing of ballots for industrial action as "a little bit unusual" given concerns around the MAX and Brexit and said the airline was open to talks.

Air Canada reported a higher-than-expected profit for the second quarter on Tuesday, as the carrier flew more high-paying passengers, helping it weather the initial impact of the Boeing 737 Max grounding.

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Projected capacity for the third quarter is expected to drop about two per cent compared with the third quarter of 2018, Air Canada said Tuesday. Originally it was to increase 3%. Southwest Airlines Co. has also erased the jets from its timetable until 2020. It also hired rivals such as Qatar Airways to operate some flights on its behalf.

According to a report in Bloomberg, Canada's largest air carrier will reduce capacity and curb earnings for the 3rd quarter even as it beat forecasts in the second.

An FAA test pilot ran scenarios in an effort to intentionally activate a stall-prevention system known as MCAS, which was identified as an issue in the crashes of flights by Lion Air and Ethiopian Airlines. Air Canada's full-year guidance remains suspended in light of the Max grounding. Most were flying the 24 Max aircraft Air Canada operated before the airplane was grounded earlier this year.

Besides the 12 Max aircraft that should have been delivered by this month, Air Canada was planning to receive another 14 jets by mid-2020, boosting the fleet to 50.

The two-dozen Max 8s now in Air Canada's fleet could return to service within two to three months of airspace bans being lifted, he added.

In recent weeks the airline has been hit by the threat of strike action by pilots in the United Kingdom and Ireland and cabin crew in Portugal. No hiring will take place "until we have clarity", Rousseau said.

"We have always held true to our values of safety, quality and integrity and those values are complementary and mutually reinforcing with productivity and company performance", the company said in a statement.



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