Air Canada, the country’s largest airline, said Monday it was finalizing contingency plans to suspend most of its operations as talks with a pilots’ union neared an impasse.
A complete shutdown of the airline’s operations could strand thousands of passengers across the country. Air Canada and its subsidiary Air Canada Rouge operate approximately 670 flights daily.
Talks between Air Canada and the Air Line Pilots Association (ALPA), which represents more than 5,200 pilots at Canada’s largest airline, are ongoing, but the two sides are still far apart, the company added.
If the two sides do not reach a settlement, the three-day suspension plan is likely to affect 110,000 passengers per day once the full lockdown is implemented, according to the airline’s projections, and the suspension is likely to begin as early as September 15.
Air Canada pilots have been pushing for unprecedented pay increases to close the pay gap with their higher-earning counterparts in the United States, who are set for record contracts in 2023 amid a pilot shortage and strong demand for travel.
The union and the airline entered a three-week cooling-off period, under Canadian law, on August 27.
“Air Canada believes there is still time to reach an agreement with our pilot group, provided the Canadian Pilots Union eases its wage demands, which are well above the average Canadian wage increase,” Air Canada CEO Michael Rousseau said Monday.
Alba did not immediately respond to Reuters’ request for comment.
Air Canada also expects it will take between 7 and 10 days to resume normal operations once fully shut down.
The airline’s shares have lost more than 18% of their value this year.
The company said it is in talks with other airlines to provide accommodation for its stranded passengers in the event of flight cancellations, adding that flights under the Air Canada Express brand will continue to operate as they are operated by third-party airlines.