Trans-Canada Air Lines (1937–1965) Air Canada's predecessor,
Trans-Canada Air Lines (TCA), was created by federal legislation as a subsidiary of
Canadian National Railway (CNR) on 11 April 1937. 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 those on the Pacific coast. Using $5 million in Crown seed money, two
Lockheed Model 10 Electras and one
Boeing Stearman biplane were purchased from
Canadian Airways and experienced airline executives from
United Airlines and
American Airlines were brought in.
Lockheed Model 14 Super Electra at
Malton Airport, 1939 Passenger flights began on 1 September 1937, with an Electra carrying two passengers and mail from
Vancouver to
Seattle, a $14.20 round trip, Transcontinental routes from Montreal to Vancouver began on 1 April 1939, using 12
Lockheed Model 14 Super Electras and six
Lockheed Model 18 Lodestars.
Renamed Air Canada and early years (1965–1990) By 1964, TCA had grown to become Canada's national airline and, in 1964,
Jean Chrétien submitted a
private member's bill to change the name of the airline from Trans-Canada Airlines to
Air Canada, which TCA had long used as its French-language name. This bill failed but it was later resubmitted and passed, with the name change taking effect on 1 January 1965. During the 1970s, government regulations ensured Air Canada's dominance over domestic regional carriers and rival
CP Air. Short-haul carriers were each restricted to one of five regions, and could not compete directly with Air Canada and CP Air. The carrier's fleet expansion saw the acquisition of
Boeing 727,
Boeing 747, and
Lockheed Tristar jetliners. With new fleet expenditures outpacing earnings, Air Canada officials indicated that the carrier would need additional sources of capital to fund its modernization. and in
1989 became completely
privatized. By 1994, Air Canada returned to profitability. demanding higher wages. Finally,
Deutsche Bank unveiled an $850 million financing package for Air Canada, if it would cut $200 million in annual costs in addition to the $1.1 billion that the unions agreed on in 2003. The offer was accepted after last-minute talks between CEO
Robert Milton and CAW president
Buzz Hargrove resulted in union concessions. ACE Aviation Holdings became the new parent company under which the reorganized Air Canada was held. In October 2004, Canadian singer
Celine Dion became the face of Air Canada, hoping to relaunch the airline and draw in a more international market after 18 months of bankruptcy protection.
Fleet modernization in the 'Frosted Leaf' livery at
Frankfurt Airport. In 2005, the airline ordered a number of Boeing 787-8s. On 31 October 2004, the last Air Canada
Boeing 747 flight landed in
Toronto from
Frankfurt as AC873, ending 33 years of 747 service with the airline. The
Boeing 747-400 fleet was replaced by the
Airbus A340 fleet. On 19 October 2004, Air Canada unveiled a new aircraft colour scheme and uniforms. A Boeing 767-300ER was painted in the new silver-blue colour, and the dark green/almost black tail was replaced with a new version of the
maple leaf known as the 'Frosted Leaf'. On 9 November 2005, Air Canada agreed to renew its widebody fleet by purchasing 16
Boeing 777s (10 -300ERs, 6 -200LRs), and 14
Boeing 787-8s. It placed options on 18 Boeing 777s and 46 Boeing 787-8s and -9s. Deliveries of the 777s began in March 2007 and deliveries of the 787s began in May 2014. On 24 April 2007, Air Canada exercised half of its options for the
Boeing 787 Dreamliner. The firm order for the Dreamliners then stood at 37 plus 23 options, for a total of 60. The airline also cancelled orders for two Boeing 777Fs. In November 2007, Air Canada leased an additional
Boeing 777-300ER.
Project XM Started in July 2006 and since completed,
Project XM: Extreme Makeover, was a $300 million aircraft interior replacement project to install new cabins on all aircraft. New aircraft such as the Boeing 777 were delivered with the new cabins factory installed. New cabin features included: • In Executive First, new horizontal fully flat Executive First Suites (on Boeing 767s, Boeing 777s, and Airbus A330s). • New seats in all classes on all aircraft, with new entertainment options. • Personal AVOD ( touchscreen LCD) in Economy class (domestic and international) and Executive Class (domestic). • Larger AVOD ( touchscreen LCD) equipped with noise-cancelling
Sennheiser headphones available in Executive First Suites. • Interactive games at all seats in Executive and Economy;
XM Radio Canada available at every seat. • USB ports to recharge electronic devices and for game controllers at all seats; 120 VAC plugs in most seats; • In Economy (2 per triple) (1 per double) (3 per quad). • In First Class/Executive (All seats)
Late 2000s financial difficulties High fuel prices and the
Great Recession caused Air Canada significant financial difficulties in the late 2000s. In June 2008, the airline announced it would lay off over 2,000 employees and cut its capacity by 7 per cent by the first quarter of 2009. President and CEO
Montie Brewer expressed confidence that the airline would weather the economic downturn. in 2015. Rovinescu served as the CEO of Air Canada from 2009 to 2021. Brewer resigned on 30 March 2009 and was replaced by
Călin Rovinescu on 1 April. Rovinescu became the first Canadian President since
Claude Taylor in 1992. Rovinescu, reported to be "an enforcer", was Air Canada's chief restructuring officer during its 2003 bankruptcy; he resigned that year after unions rejected his demands. Air Canada's contracts with four unions also expired around this time. The airline stated that its $2.85 billion pension shortfall (which grew from $1.2 billion in 2007) was a "liquidity risk" in its first-quarter report, and it required new financing and pension "relief" to conserve cash for 2010 operations. The company was obligated to pay $650 million into the pension fund but it suffered a 2009 Q1 loss of $400 million, so it requested a moratorium on its pension payments in 2009. The unions had insisted on financial guarantees before agreeing on a deal. Rejecting union calls for a direct bailout of the company, federal finance minister
Jim Flaherty instead appointed retired judge James Farley to mediate pension issues between the company, the unions representing its employees, and retirees. Farley had presided over the company's 2003 bankruptcy. In July 2009, Air Canada requested and received CA$1 billion in financial aid from a consortium of entities, including the Canadian government, ACE, and associate company Aeroplan. The Centre for Aviation reported that only CA$600 million was actually loaned to Air Canada; the rest of the money was from sale-leaseback accounting and "aggregating an array of biscuit-tin savings".
2010s In December 2010, ACE sold 44 million Air Canada shares, followed by the remaining 31 million shares in November 2012 to Cormark Securities Inc.
New branding and fleet in February 2017 with an
Airbus A321 On 9 February 2017, a new retro red and black aircraft livery was launched, to coincide with Air Canada's 80th anniversary and Canada's 150th anniversary of Confederation. The update includes design aspects from the logo used between 1964 and 1992, with an overall white colour scheme, with a black underside, tail fin with red maple leaf rondelle, black "Air Canada" lettering with a red maple leaf rondelle underneath, and a black "mask" surrounding the cockpit windows. at
Halifax Stanfield International Airport, 2020 In December 2013, Air Canada ordered 61
Boeing 737 MAX single-aisle narrow body aircraft to replace its existing fleet of Airbus A320 series aircraft with the first MAX 8 variant delivered on 2 November 2017. Some
Airbus A319s will be transferred to Air Canada's Rouge subsidiary, with the remaining fleet retired. As part of the deal, Boeing purchased 25 Embraer E190s from Air Canada that were retired in 2016. The same year, Air Canada signed an agreement with
Bombardier Aerospace to replace the E190s with
Airbus A220/CSeries aircraft from 2019. In July 2017, Air Canada reintroduced Premium Economy on its North American wide-body flights. In April 2018, Air Canada rebranded its international business class cabin as Air Canada Signature Class. Passengers could expect an enhanced menu, including the new Air Canada Signature Cocktail, as well as new amenity kits, a chauffeur service (using BMW vehicles) at its hubs during domestic to international connections, and access to the Air Canada Signature Suite at
Toronto Pearson International Airport. On select North American routes, Air Canada Signature Service is offered on widebody aircraft. In May 2018, Air Canada listed Taiwan as part of China to comply with a requirement of China's civil aviation administration. On 6 June 2018, Air Canada and
Air China signed a joint venture, the first joint venture between a North American and Chinese airline.
Proposed acquisition of Transat A.T. On 16 May 2019, Air Canada announced it was in exclusive talks to buy
Transat A.T., the parent company that owns
Air Transat, for CA$520 million. On 27 June 2019, Transat A.T. agreed to be purchased by Air Canada for CA$13 per share. On 11 August 2019, Air Canada raised the purchase price of Transat A.T. to CA$18 per share. The overall value of the deal was now $720 million. On 23 August 2019, 95% of Transat A.T. shareholders approved the acquisition by Air Canada on that basis. The agreement was revised downwards in October 2020 to CA$5 per share, reflecting the challenges posed to the airline industry by the
COVID-19 pandemic. The plan was "expected to face intense scrutiny from the Competition Bureau and other regulatory authorities, including in Europe", according to CBC News. While the Government of Canada approved the takeover on 11 February 2021, it was dropped in April 2021 following a failure to secure
European Commission approval.
2020s COVID-19 pandemic Travel restrictions caused by the COVID-19 pandemic forced Air Canada to heavily restrict service. On 18 March 2020, the airline announced it would suspend most of its flights by 31 March. Service began to return to normal on 22 May, with flights to more cities being added over the summer. In its first quarterly financial report, Air Canada announced it had lost CA$1.05 billion, compared to a profit of CA$345 million in Q1 2019. The airline similarly suffered in the third quarter, reporting a loss of CA$685 million. It stated capacity in the fourth quarter of the 2020 fiscal year would be 75 per cent lower than the previous year. In June 2022, after the provincial governments across the country began lifting pandemic-era restrictions, Air Canada announced it was cancelling over 150 daily flights in the summer due to unprecedented and unexpected pressure in the aviation industry. In April 2021, the
Government of Canada acquired 6.4% of Air Canada as a part of a $5.9 billion
COVID-19 related assistance package, and has not ruled out further investment. In 2024, the Government sold its stake in Air Canada, confirming they "...did not intend to be a long-term owner of the shares." In September 2022, Air Canada welcomed the Government of Canada's decision to lift remaining COVID-19 restrictions, including requirements for wearing masks on aircraft, testing and quarantine, and the compulsory use of
ArriveCAN beginning 1 October 2022 and noted that the measures were not justified by science.
Fleet renewal, expansion, Airbus A320 family retrofit, and transfer of Boeing 737 MAX to Air Canada Rouge On 22 March 2022, Air Canada placed a order for 26
Airbus A321XLR aircraft, making Air Canada the second airline in Canada to fly the Airbus A321neo family of aircraft, alongside
Air Transat. On 23 October 2023, Air Canada announced that it would retrofit the Airbus A321, and 8 of its
Airbus A320 aircraft with the A220 standard to replace the XM cabin, which would feature Airspace XL bins, new entertainment screens, exterior cameras, and satellite based Wi-Fi. On 17 December 2024, Air Canada announced that it would transfer its
Boeing 737 MAX 8 aircraft to
Air Canada Rouge, and it would create a hub for Rouge at
Vancouver International Airport. Air Canada Rouge's Airbus A320 and A321 fleet will transfer to the mainline fleet as part of the transition, and would be retrofitted with the A220 standard.
Flight attendants strike In August 2025, Air Canada experienced a work stoppage involving more than 10,000 flight attendants represented by the
Canadian Union of Public Employees. The strike began on 16 August and led to the cancellation of approximately 130,000 passenger journeys per day. A tentative agreement was reached on 19 August, and operations resumed later that day. The wage component of the agreement was subsequently rejected by 99.1% of members, although other provisions remained in effect. The strike resulted in 3,200 flight cancellations and an estimated revenue loss of C$430 million.
CEO resignation On March 30, 2026, the company announced that its chief executive,
Michael Rousseau, will retire from his position by the end of September 2026. Air Canada's board said it would begin a process to find his replacement. ==Corporate affairs==