Air Canada (AC) is moving to cancel 500 flights by Aug. 15 as it prepares for a strike to begin this weekend by its unionized flight attendants.
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The Montreal-based carrier said the canceled flights could potentially impact 100,000 travelers both to and from Canada and within the country. The disruption comes as 10,000 of the airline’s flight attendants prepare to walk off the job at midnight on Aug. 16.
The Canadian Union of Public Employees (CUPE), which represents the flight attendants, has issued a 72-hour strike notice to Air Canada, as required by law, setting the stage for the country’s flagship carrier to be grounded in coming days.
Bargaining Impasse
Air Canada and the union have been negotiating a new collective agreement for the flight attendants for months. However, both sides say that bargaining has reached an impasse over issues that include wages, scheduling, and duties carried out both in the air and on the ground.
The union’s leadership team rejected Air Canada’s offer of a 32.5% wage increase for the flight attendants, calling the offer “insufficient.” CUPE has also rebuffed a proposal from the airline to enter binding arbitration, saying it prefers to negotiate a deal at the bargaining table. AC stock is down 11% this year.
Is AC Stock a Buy?
Air Canada’s stock has a consensus Strong Buy rating among 12 Wall Street analysts. That rating is based on 10 Buy and two Hold recommendations issued in the last three months. The average AC price target of C$25.79 implies 30.79% upside from current levels.
