Air Canada

Canadas national airline originated from the Canadian federal governments 1936 creation of Trans-Canada Airlines (TCA), which began operating its first transcontinental flight routes in 1938. In 1965, TCA was renamed Air Canada following government approval. Following the 1980s deregulation of the Canadian airline market, the airline was privatized in 1988. In 2001 Air Canada acquired its largest rival, Canadian Airlines. In 2003 the airline filed for bankruptcy protection and, the following year, emerged and reorganized under the holding company ACE Aviation Holdings Inc. In 2006, 34 million people flew with Air Canada as the airline celebrated its 70th anniversary. Air Canada is presently recognized as the Skytrax Best International Airline in North America, as well as being ranked as a 4 Star Airline by Skytrax in 2013.

Air Canada has a fleet of Airbus A330, Boeing 767, and Boeing 777 wide-body jetliners on long-haul routes, and uses Airbus A320 family aircraft, including the A319, A320, and A321 variations and Embraer E170/E190 family aircraft on short-haul routes. The carriers operating divisions include Air Canada Cargo and Air Canada Jetz. Its subsidiary, Air Canada Vacations, provides vacation packages to over 90 destinations. Together with its regional partners, the airline operates on average more than 1,530 scheduled flights daily.[8]

Air Canadas predecessor, Trans-Canada Airlines (TCA), was created by legislation of the federal government as a subsidiary of Canadian National Railway (CNR) on 11 April 1936.[1] The newly created Department of Transport under Minister C. D. Howe desired an airline, under government control, to link cities on the Atlantic coast to the Pacific coast. Using $5 million in government seed money, two Lockheed Model 10 Electras and one Boeing Stearman biplane were purchased from Canadian Airways.[9] Experienced airline executives from United Airlines and American Airlines were brought in.[1]

Passenger flights began on 1 September 1937, with an Electra carrying two passengers and mail from Vancouver to Seattle, a $14.20 round trip.[1] On 1 July 1938 TCA hired its first flight attendants.[10] Transcontinental routes from Montreal to Vancouver began on 1 April 1939, using 12 Lockheed Model 14 Super Electras and six Lockheed Model 18 Lodestars.[9] By January 1940 the airline had grown to about 500 employees.[10]

In 1942 Canadian Pacific Airlines suggested a merger with TCA. Prime Minister Mackenzie King rejected the proposal and introduced legislation regulating TCA as the only airline in Canada allowed to provide transcontinental flights. With the increase in air travel after World War II, CP Air was granted one coast-to-coast flight, and a few international routes.[1]

By 1964 TCA had grown to become Canadas national airline, and in 1964 [Lester B Pearson] submitted a private members bill to change the name of the airline from Trans-Canada Airlines to Air Canada. This bill failed but it was later resubmitted and passed, with the name change taking effect on 1 January 1965.[9]

During the 1970s government regulations ensured Air Canadas dominance over domestic regional carriers and rival CP Air.[13] Short-haul carriers were each restricted to one of five regions, and could not compete directly with Air Canada and CP Air.[13] CP Air itself was subject to capacity limits on intercontinental flights, and restricted from domestic operations. Air Canadas fares were also subject to regulation by the government.[13]

In the late 1970s, with reorganization at CNR, Air Canada became an independent Crown corporation. The Air Canada Act of 1978 ensured that the carrier would compete on a more equal footing with rival regional airlines and CP Air, and ended the governments direct regulatory control over Air Canadas routings, fares, and services.[13] The act also transferred ownership of the carrier from Canadian National Railway to a subsidiary of the national government.[1] Deregulation of the Canadian airline market, under the new National Transportation Act, 1987 officially opened the airline market in Canada to equal competition.[14] The carriers fleet expansion saw the acquisition of Boeing 727, Boeing 747, and Lockheed Tristar jetliners.[12]

With new fleet expenditures outpacing earnings, Air Canada officials indicated that the carrier would need additional sources of capital to fund its modernisation.[13] By 1985 the Canadian government was indicating a willingness to privatise both Canadian National Railways and Air Canada.[13] In 1988 Air Canada was privatised, and 43% of its shares are sold on the public market,[9] with the initial public offering completed in October of that year.[13] By this time, its long-haul rival CP Air had become Canadian Airlines International following its acquisition by Pacific Western Airlines.[12]

On 7 December 1987 Air Canada became the first airline in the world with a fleet-wide non-smoking policy,[15] and in 1989 became completely privatised.