Air Canada outlines financial hit from August cabin crew strike

Air Canada lowered its annual financial guidance while outlining the cost impact of a cabin crew strike which caused more than 3,200 flight cancellations in August.

The airline estimated an revenue impact of C$430 million (£230 million) mainly due to refunds issued to passengers, customer compensation and lower than expected travel bookings in August and early September. 

However, C$145 million (£77.5 million) in costs are estimated to have been avoided due to less flying activity, largely attributable to lower fuel expenses. 

This was partially offset by an estimated C$90 million (£48 million) of incremental costs associated with reimbursements to customers for out-of-pocket expenses and labour-related operating costs.

The carrier said while issuing updated 2025 financial guidance: “Air Canada deeply regrets the impact of the disruption on its customers and remains committed to resolving every claim submitted by affected customers quickly and accurately, having done so for more than 60,000 claims to date.” 

The financial impact of the labour disruption in August by the Canadian Union of Public Employees (CUPE), the union representing cabin crew saw full year earnings forecasts reduced to C$2.9-C$3.1 billion from a previous target of C$3.2-C$3.6 billion.

The airline expects operated capacity for the quarter to September 30 to decline by about 2% year on year as a result of the cancellation of more than 3,200 flights.

Quarterly operating income is set to shrink to no more than C$300 million (£48 million) from more than C$1 billion (£535 million) in the same period last year.