MIAMI – To fight the effects that COVID-19 has on the airline industry, Air Canada (AC) is concentrating its regional services on a single operator.

In today’s press release, AC announced the intention to amend its Capacity Purchase Agreement (CPA) with Jazz Aviation (QK), the property of Chorus Aviation Inc., under which QK operates part of AC Express services.

Under the revised agreement, QK will inherit all Embraer E175 fleet from Sky Regional thus becoming the sole operator for AC Express. The next CPA pending is an agreement between QK and ALPA (Air Line Pilots Association). If a deal is reached, the amended CPA shall have a retroactive effect from January 1, 2021.

Air Canada Embraer E175SU C-FEJB – Photo : Air Canada

A Costs Reduction of US$316m

Commenting on the matter, Richard Steer, Senior Vice President Operations and Express Carriers: “Air Canada is consolidating its regional flying with Jazz in response to the ongoing devastating impact of COVID-19 upon the airline industry.”

“This necessary realignment of our regional services will help Air Canada achieve efficiencies and reduce operating costs and cash burn by consolidating its regional operations with one provider. Moreover, by streamlining the regional fleet, this agreement will also position Air Canada to operate more competitively with a single provider as traffic returns following the pandemic.”

The results expected from these new arrangements consists of cost savings up to US$316m (C$400m) over the 15-year term of the CPA.

Sky regional was thanked by Michael Rousseau, President and Chief Executive Officer of Air Canada which stated, “Sky Regional has provided excellent service to Air Canada and its passengers over the past decade with an impeccable safety record and excellent on-time performance and cost management. We thank Sky and all of its employees for their effort, dedication, and valued partnership.”

Featured image: Express-E175-2. Photo: Air Canada