Table of Contents
Recommendations
- Bankruptcy protection- the airline used this strategy to deal with financial problems caused by operational challenges which are beyond their control.
- Capacity – its is vital for airline operators to plan their capacity to minimize cost. They should maximize usage of their planes rather than increase their fleet size.
- Contend with competitors- regardless of operational challenges, the airline should push on to stay in the market.
- Negotiating with governments- Air Canada should negotiate with governments to have some restrictions reduced or abolished.
- The airlines should try to schedule their airlines in a way such that the weather will have less effects on them to avoid flight delays.
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Action Plan
- Following financial crisis in 2010, the airline controlled its finances by creating new agreements with suppliers and credit providers.
- Canada airline was forced to launch a low price Tango fares to compete with Westjet who host smaller players in a low budget segment.
- To cut costs and compete with international airlines, Air Canada has forged alliances with other operators for example it’s the founding member of star alliance.
- Air Canada entered into an agreement with EU governments. Restrictions for Air Canada were reduced. Following this it launched five direct airline services to major cities in Europe.
Summary
- Due to challenges in the environment, Air Canada had to make strategies in order to succeed. They came up with recommendation to ensure that they minimize losses.
- The recommendations were implemented and some of these include: signing deals with governments, forming alliances with other operators and making financial deals with their suppliers and credit providers.
