Air Canada (AC) says it is preparing for a shutdown of its operations as contentious contract negotiations with its pilots’ union drag on.
The airline has announced that it will have to start grounding aircraft as early as Sept. 13 ahead of a potential strike from the Air Line Pilots Association.
Air Canada added that a work stoppage at the carrier is increasingly likely and that it plans to shutdown operations if a 72-hour strike notice is issued by the union.
In a news release, Air Canada said negotiations aimed at reaching a new collective agreement with the pilots are stuck due to what management calls “excessive” wage demands.
For its part, the union has accused Air Canada of “corporate greed,” noting that the carrier has posted record profits in recent quarters.
The pay dispute at Air Canada comes after pilots at United Airlines (UAL) secured a 40% wage increases over four years, and WestJet pilots got a 24% pay increase.
Air Canada has offered a 30% pay raise for the pilots over four years, plus improvements to other benefits. The pilots’ union has asked for a pay raise of as much as 60%.
In August, Air Canada’s pilots voted 98% in favour of a strike mandate.
A shutdown by Air Canada could throw the country’s transportation and travel sectors into chaos as the airline operates 670 daily flights involving more than 110,000 passengers.
Air Canada said that, once a shutdown occurs, resuming normal operations will take the airline about 10 days.
The stock of Air Canada has fallen nearly 30% over the last 12 months to trade at $15.07 per share. In the past five years, the airline’s stock has declined 65%.