COMMERCE 4PA3 Lecture Notes - Lecture 3: Trans-Canada Air Lines, Canadian Pacific Air Lines, Canadian Airlines

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18 Oct 2018
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In 1995, senior management had to make decisions regarding the airlines cost position by approximately million (save money?) on annual basis which they anticipated would increase profitability and cash flow; grown after a 14% shrinkage. The alternative was to downsize, focus on profitable international routes and exiting some markets. By june 30th, 1995 management had to reach agreement with unions. The negotiations had created confusion and resulted in negative press which hurt the stock price. Management had to prepare recommendation for the board. Exhibit #1: genealogy of major canadian air carriers. Prior to 1989 there were a ton of airlines that were basically categorized into 3 tiers; national carriers, regional carriers, commuters and charters. These were all under regulation by the government. Trans canada airlines was the first one established which is the predecessor of air canada and its main competitor was canadian pacific airlines which was later bought by pwa.

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