Air Canada reverses course on $6 billion Boeing order
Air Canada said it is backing out of a deal to buy 18 Boeing 777s and 14 787s after its pilots union rejected a series of cost-cutting measures.
Air Canada, which emerged from bankruptcy last fall, ordered the planes in April and the union’s leadership endorsed the purchase of the new planes earlier this month. Among the planes Air Canada intended to purchase were 777 freighter models.
There is no penalty for canceling the order, Air Canada said.
Air Canada said it will turn to the used aircraft market for widebody aircraft. It’s business plan calls for three additional 777-300s in 2006. The 787s, mid-size aircraft Boeing is developing for long-haul service, were intended to replace Boeing 767s. Air Canada said it intended address its long-term aircraft requirements in the future.