AC’s Rovinescu: Rouge Will Convert Into A Narrowbody Airline
Anna Kroupina, Open Jaw
Air Canada’s CEO, Calin Rovinescu pulled no punches during a recent Air Transport World webinar, qualifying the dire situation the airline industry finds itself in as a result of the coronavirus pandemic.
“We’ve moved very quickly from a severe human tragedy, which is not dealt with yet, to one that is catastrophic for our industry and, quite frankly, an economic tragedy,” he said. “It’s a train barreling at us and we have to be mindful how to deal with it.”
Rovinescu reviewed a number of actions the airline has taken to stem the bleeding caused by grounding 85-90% of its fleet and chastised the Canadian government for not providing any assistance to the industry.
One of the steps has been decommissioning the 767, both for mainline and for Rouge in the near future. The A319s are also being retired.
"Their retirement will simplify the airline's overall fleet, reduce its cost structure, and lower its carbon footprint," the airline indicated in its earnings report.
The medium-term plan is to turn Rouge into a narrowbody airline with transatlantic capability with a fleet of A320 and A321 aircraft. With lower operating costs, using narrowbody Rouge aircraft on previous mainline routes will likely support the carrier’s financial objectives.
“Once the 767s exit, Rouge will become primarily a narrowbody operator with Airbus A320 and A321s. From that, we will be able to serve lots of the leisure destinations that we had been building into the Rouge profile – the Caribbean, the US, the sun destinations, and even transatlantic routes," Rovinescu said during the webinar.
Air Canada Vacations Managing Director Nino Montagnese added that the move "will continue to support Air Canada Vacations packages."
“Restarting the aviation industry is not like reopening a pizzeria."
AC entered the pandemic with a strong balance sheet, Rovinescu noted, and will ultimately survive this slump. But it won't be quick, or easy.
Rovinescu pointed out that bringing an airline back online doesn't just happen overnight.
“Restarting the aviation industry is not like reopening a pizzeria," he stated. "Based on our requirements of taking aircraft out of maintenance, making sure we have the crew and connecting schedules built, these are all drivers that are important. We can’t go from 5% of passengers to 55% overnight."
Rovinescu predicted it will take a minimum of three years to get back to 2019 levels.
“We recognize it will be a slow buildup. We have no expectation of a V-shaped recovery.”
Air Canada expects Q3 2020 to yield 25% of last year’s activity, according to the airline's Q2 financial report, which stated, "The airline will continue to dynamically adjust capacity and take other measures as required to account for health warnings, travel restrictions, border closures globally and passenger demand."
Anna Kroupina Journalist
Anna is OJ's newest member and she joins the team as a writer/reporter. She co-writes the daily news and covers events. Although she's new to the industry, pursuing a career path in travel/tourism has been a goal since her first family road trip to the Florida Keys sparked a desire to discover the world and this exhilarating, fast-paced industry.
ELI DANIELS- June 15, 2020 @ 10:15
A320 & A321 not comfort to Europe and wont compete with other Euro carriers