Amidst falling demand driven by the pandemic, airlines have started to terminate aircraft in an effort to cut costs and right size the fleet for a reset on the growth profile for air travel. While a decision to reduce the fleet does make sense, some airlines could start suffering from a blowback as the market recovers and not enough lift is available or on order to support the recovery. One of the airlines that is trimming its fleet significantly is Air Canada. Combined with order book changes and an aging single aisle fleet things could become challenging in the coming years. In this article, AeroAnalysis shows that Air Canada aligns the fleet for the future and that includes changes to aircraft it committed to.
Air Canada reduces fleet significantly
As demand fell, Air Canada started dismantling the bigger part of its Air Canada Rouge fleet. The airline has cut the 25 Boeing 767-300ERs and has also decided to cut 22 Airbus A319ceo aircraft. Focusing on mainline single aisle, 13 Airbus A319ceo aircraft are cut as well as 14 Embraer E190s and the 2019 called for 28 aging fleet members to be removed by 2021.
|Aircraft model||Removals or future removals|
The Embraer aircraft were around 13 years old when they were removed from the fleet and those retirements were already scheduled. The Airbus A319ceo removals were scheduled to commence in 2021 when some aircraft would start reaching the age of 25 years while the Airbus A320ceo aircraft were to be removed from the active fleet as they started to hit the age of 30 years.
Air Canada cancels orders
The big question has become how Air Canada will be replacing the permanently retired lift as the company has also reduced its outstanding orders with Airbus and Boeing. Up until the end of October, Air Canada had 34 Airbus A220-300 aircraft that were yet to be delivered according to our Airbus Backlog Monitor. One aircraft has been delivered since, leaving 33 aircraft in backlog.
First wave of Boeing 737 MAX cancellations for the year hits Boeing:
•Air Canada: -11
•Air Lease Corporation: -9
•Business Jet VIP Customer: -1
•Oman Air: -10$BA #aerospace #aviation pic.twitter.com/y2xATta2dj
— Dhierin Bechai (@DPBechai) March 11, 2020
By the end of October, Air Canada still had outstanding orders for 26 Boeing 737 MAX aircraft. The airline had previously ordered 61 but cancelled 11 aircraft on order this year while 24 aircraft had already been delivered.
By the end of October there still where 59 aircraft on order providing significant lift capability to replace the Airbus A320ceo and Airbus A319ceo aircraft. However, the airline has decided to cancel 12 Airbus A220-300s and 10 Boeing 737 MAX aircraft bringing the number of single aisle aircraft in on order to 37 aircraft, less than half of the single aisle aircraft that will be leaving the Air Canada mainline and Rouge fleet in the coming years.
Bringing the Boeing 737 MAX back
However, what should be considered is that Air Canada has accepted some aircraft over the course of 2020 and there still is the MAX. Air Canada had 24 Boeing 737 MAX aircraft in the fleet when the aircraft was grounded. The majority of 2019, the Boeing 737 MAX was grounded. Getting back to 2019 air travel levels still does not include the lift provided by the Boeing 737 MAX. So, there are 24 Boeing 737 MAX aircraft to fill the gap and 11 Airbus A220 aircraft were delivered during the year while there was no supporting demand for these aircraft. So, there were already 35 Boeing 737 MAX and Airbus A220 aircraft in the fleet that either weren’t deployed or for which demand simply did not exist. To that we can add the 37 still on order and the 1 Airbus A320ceo that was delivered. By doing so, the number of aircraft already in the fleet and on order equals 73 aircraft.
With the changes in the order book, Air Canada brings its fleet requirements in the coming years in line with the order book supporting a market that will recover instead of grow. Effectively, Air Canada aligns the fleet and orders for the future.