Air Canada said it plans to double the size of its Airbus A220 fleet and expand its collection of Boeing 787-10 Dreamliners and fuel-efficient Airbus 321 XLRs as part of an ambitious push to reach $30 billion in revenue by 2028.
The airline revealed at its 2024 Investor Day in Toronto it intends to acquire about 90 new aircraft over the next three years and spend $1 billion to reconfigure and upgrade existing aircraft cabins.
“We are in an excellent position to successfully execute our long-term plans,” said Michael Rousseau, president and CEO of Air Canada, in a live-streamed presentation on Dec. 17.
“Our commitment to excellence will ensure its execution.”
Air Canada plans to acquire 36 new single-aisle Airbus A220s, 14 Boeing 787-10 Dreamliners, 25 Airbus 321XLRs and 12 Boeing 737 Max aircraft by 2028.
These acquisitions make up about half of the airline’s planned $18 billion in capital investments over the next three years, aimed at harnessing rising demand for air travel and capturing more international passengers.
The capital expenditures are projected to deliver major operational savings, including 15 to 20 percent better fuel and maintenance costs than the composite average of the current fleet, said John Di Bert, executive vice-president and chief financial officer.
“The training time for new crews serving the new aircraft and the time invested in developing and implementing modern technologies does put a cap on productivity gains in the short term,” he said.
“However, from the summer of 2026 through the end of the decade, we see a faster rate of productivity improvement.”
Air Canada is betting on the A220, originally developed as part of Bombardier’s CSeries, as the key to better regional market performance, and for growth in sixth-freedom transport, which allows for travel between two foreign countries with stops in Canada.
The airline projects 24 percent less cost per available seat mile (CASM) with its A220s, plus the possibility of new routes like Toronto to Monterrey, Mexico; Toronto to Sacramento; and Montreal to Austin, Texas.
Adding Dreamliners will enhance Air Canada’s premium and cargo performance, with 30 percent more business class seats versus legacy Airbus A330 aircraft, and about 25 percent more cargo potential, the airline said. The Dreamliners are also projected to deliver 10 percent CASM savings.
Similarly, the A321XLR delivers about 30 percent lower fuel burn than older-generation A321ceos and 12 percent better revenue per available seat mile (RASM), Air Canada said.
Air Canada Rouge, the airline’s lower-cost carrier, aims to leverage the Boeing 737 Max to become more competitive in the leisure market, with 20 percent lower projected CASM than the existing A320-based fleet.
The company is also investing $1 billion to reconfigure and enhance existing aircraft with fleet-wide Wi-Fi, “modern and comfortable seating,” and enhanced cabin storage.
Air Canada’s sixth-freedom ambitions include capturing two percent of U.S. market share, saying 80 percent of the addressable U.S. to international market can “efficiently connect” through its hubs in Toronto, Vancouver and Montreal.
“Air Canada is a world-class airline that competes on the global stage,” said Mark Galardo, executive vice-president, Revenue and Network Planning, and president, Cargo.
“We have grown beyond our roots as Canada’s flag carrier to build a leading network that spans all six continents, and in doing so, can rival some of the greatest international carriers.”
Wouldn’t by a thing from the usa.
As a shareholder and a frequent flyer , this is all good news. I just wish that Air Canada could attack its Toronto YYZ operational issues and customer service issues with the same fervour that it applies to its fleet and network planning.