Air Canada

About Air Canada

Air Canada filed for bankruptcy protection on April 1, 2003. The airline was hit by SARS, the Iraq war, and a weak economy. High fuel costs and labor contracts added to financial pressure. Air Canada emerged from restructuring in September 2004 after cutting 10 billion in costs. The restructuring reduced the workforce by 4,000 and renegotiated labor contracts. Deutsche Bank provided exit financing. Air Canada returned to profitability briefly before facing challenges again. Air Canada filed for bankruptcy a second time in 2021 during the COVID pandemic. The airline industry has been particularly prone to bankruptcies due to high fixed costs, fuel price volatility, and sensitivity to economic conditions.