Abstract

This case examines the problems faced by Canada's leading airline company, Air Canada, during the 1990s that led to its filing for bankruptcy protection in 2003. It details the company's growth from its inception as a government owned entity in 1937 to becoming the 10th largest airline in the world by the 1990s. The case takes a look at the circumstances that led to Air Canada's merger with archrival Canadian Airlines International. It also covers the problems that cropped up after the merger and the remedial measures adopted. The case moves on to examine the various problems faced by Air Canada during the early 21st century, which forced it to seek creditor protection. Finally, it discusses the company's future prospects in light of its restructuring plan and the uncertainties that plague the Canadian and global airline industries.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• Competition in the airline industry.

Keywords

Troubles, Troubles Everywhere!, Background Note, Air Canada, CAI & ONEX - The Takeover Drama, Merger Traumas, Restructuring: Post-September 2001, Table I Air Canada - Sub Brands, The Bad Times Continue, Will the Problems Ever End