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Air Canada Stock Drops 9 Percent After Large First-Quarter Loss

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8 months ago

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Air Canada Manila
Air Canada posted a first-quarter adjusted loss of C$0.27 per share: Getty Images

Air Canada posted a larger first-quarter loss than projected on Thursday, citing higher operating costs related to labor and aircraft maintenance, overshadowing early signs of a recovery in corporate demand. Air Canada’s shares fell 9% to C$18.58 in afternoon trading in Toronto.

North American carriers are grappling with rising expenses as they add flights and run older, less fuel-efficient planes, while a lack of new aircraft makes it difficult to benefit on robust travel demand.

According to Mark Galardo, Air Canada’s vice president of network planning, corporate demand is up 10% to 20% year on year into the second quarter, with new demand coming from the technology industry.

“We’re starting to see some very encouraging signals in corporate demand,” Galardo told analysts.

Canada’s largest airline did not experience the same first-quarter bounce in corporate travel that lifted U.S. airline profitability.

Montreal-based Air Canada has also stated that it is negotiating compensation with RTX engine manufacturer Pratt & Whitney following issues with its geared turbofan engines, which have grounded seven of its A220 planes.

The carrier, which is currently in contract talks with its pilots, reported a 21% increase in labor expenses during the quarter.

Air Canada’s operating expenses increased 6% to C$5.22 billion ($3.80 billion), the airline reported, despite a revival in significant spending by corporate clients who had been mostly absent from the post-pandemic travel boom.

The airline confirmed its 2024 core profit estimate, estimating adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) in the range of C$3.7 billion to C$4.2 billion.

Air Canada posted a first-quarter adjusted loss of C$0.27 per share, compared to analysts’ average projections of a C$0.07 loss, according to LSEG data. Its quarterly operating revenue increased 7% to C$5.23 billion, exceeding Wall Street’s estimate of C$5.19 billion.

Air Canada Seating

New seat selection fee for passengers: Getty Images

Air Canada walks back new seat selection policy

Air Canada has temporarily rescinded its proposal to levy a new seat selection fee for passengers booked on the lowest rates. Customers with rates that did not include free seat selection prior to check-in were randomly given a seat at check-in, with the option to change to another available seat for free, CTV News reports

However, some Air Canada customers received alerts earlier this month that the airline would soon charge travelers standard or basic rates to change their automatically allocated seats at check-in.

Kerry Berlinquette, an Ontario-based travel agency, posted a photograph of a warning she received on April 18 on her Facebook page.

“We’re introducing a new seating assignment process for Standard or Basic Fares,” according to the announcement.

“When customers enter the check-in flow, our system will automatically assign a free seat for those who have not purchased a seat in advance.” If customers want to alter their automatically allocated seat, they can do so for a charge.

“It stinks. It was awful enough having to compete for a seat 24 hours before the flight. “Just another money grab,” one Facebook user said in response to Berlinquette’s post.

“It’s frustrating when traditional airlines behave like budget airlines,” a Reddit user commented on April 24. “They have abolished free checked baggage, and now they have removed the chance to select free seats upon check-in. “What will happen next?”

I don’t know why everyone is mad at @AirCanada for introducing another junk fee. They have been trending towards the bottom end of the discount airline market since their last bailout. Their service, food, on time rating, cleanliness, and generally quality is horrible.

— Kritical Defiance (@KriticalDave) April 25, 2024

The message, which said that the change will take effect on April 24, sparked a flood of complaints from furious customers on Facebook, X, and Reddit.

So Air Canada can now split your party at their discretion to force you to spend money to ensure your party sits together. (Previously it was a safe gamble at 24 hours you could find seats together) pic.twitter.com/rTvxfVqqGy

— Steven Clark (@TheFwordNB) April 25, 2024

Following significant criticism, Air Canada sent a comment (opens in a new tab) to airline industry news website Pax News, confirming the policy change.

“What has changed, and is consistent with our branded fares, is that after seats are assigned at check-in for no fee, customers who now wish to change to a different seat from the one we assigned them will have to pay the same fee they would have paid prior to check-in,” the airline wrote to Pax News. The airline would continue to assign seats to ensure families on the same booking are seated together for no fee, as per Canada’s Air Passenger Protection Regulations.

“This is the practice at other airlines, including some in Canada.”

However, on April 26, Air Canada suspended the new cost. The flag carrier refused to clarify whether consumer backlash had influenced the decision and declined to address CTVNews.ca’s queries about why it had implemented the fee and how long the pause would stay.

“We paused the implementation for operational reasons to ensure a smooth rollout for our customers and employees,” an unnamed spokesman told CTVNews.ca in an email on Monday.

“We will communicate next steps at the appropriate time.”

Air Canada would not be the first Canadian airline to impose a price for seat selection after check-in. However, airlines that charge a seat selection fee, such as Flair and Porter, are typically low-cost carriers with lower base tickets than Canada’s flag carrier.

One exception is WestJet, Canada’s second-largest airline after Air Canada, which charges a price for seat selection.

Source: Reuters, CTV

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Geoff Brown is a seasoned staff writer at VORNews, a reputable online publication. With his sharp writing skills he consistently delivers high-quality, engaging content that resonates with readers. Geoff's' articles are well-researched, informative, and written in a clear, concise style that keeps audiences hooked. His ability to craft compelling narratives while seamlessly incorporating relevant keywords has made him a valuable asset to the VORNews team.

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Sonic the Hedgehog Dominates Christmas Wish Lists

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1 day ago

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2024-12-21

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Sonic the Hedgehog
Sonic the Hedgehog Merchandise are hot Christmas Items

Sonic the Hedgehog is dominating Christmas wish lists this year. The lovable blue hedgehog is back in the spotlight, from sonic the hedgehog toys and games to sonic the hedgehog coloring pages and movie hype.

Sonic-themed holiday merchandise is on fire, from quirky sweaters to action figures flying off shelves. Sonic the Hedgehog Christmas outfits for kids are selling out fast, making them a go-to gift option for festive fun.

Retailers have been quick to recognize Sonic’s holiday appeal. Special promotions and exclusive items, like the Sonic holiday t-shirts, are everywhere.

Everyone’s stocking up on Sonic merchandise, from big-box stores to boutique retailers.

Online shopping platforms are seeing a surge in searches for Sonic items. Whether it’s Sonic Christmas-themed tops or Sonic the Hedgehog coloring pages, Sonic the Hedgehog toys or Sonic and the Hedgehog 3, the demand is skyrocketing.

Retailers who tap into this trend are sure to see strong holiday sales.

Sonic has been around since the early 90s, but his popularity never wanes. With the release of Sonic 3, fans are more excited than ever.

sonic the hedgehog 4

Sonic the Hedgehog 4

Meanwhile, Paramount Pictures is preparing “Sonic the Hedgehog 4,” with the newest addition in the family-friendly genre set for a spring 2027 release.

The announcement comes as “Sonic 3” opens in theatres on Friday, estimated to gross $55 million to $60 million from 3,800 North American locations.

The sequel is shaping up to be a good holiday season blockbuster for Paramount, which explains the desire in future “Sonic” adventures. On the international front, the film will be released on Christmas Day in 52 markets.

On Rotten Tomatoes, critics gave “Sonic 3” an outstanding 87% fresh score.

The first two films grossed a total of $725.2 million at the global box office and generated over $180 million in global consumer expenditure through home entertainment rentals and digital purchases.

They also inspired a spinoff Paramount+ series, “Knuckles,” which premiered earlier this year.

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Amazon Strike Called By Teamsters Union 10,000 Walkout

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2 days ago

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2024-12-20

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Amazon Strike Called By Teamsters Union
Teamsters members were demonstrating at "hundreds" of other Amazon locations.

An Amazon strike has hit facilities in the United States in an effort by the Teamsters union to pressure the corporation for a labour agreement during a peak shopping season.

The Teamsters union told the Associated Press that Amazon delivery drivers at seven facilities in the United States walked off the job on Thursday after the firm failed to discuss a labour contract.

According to the union, Amazon employees in Teamsters union jackets were protesting at “hundreds” of additional Amazon facilities, which the union billed as the “largest strike” in US history involving the company.

The corporation, which employs over 800,000 people in its US delivery network, stated that its services will be unaffected.

It was unclear how many people, including members of Germany’s United Services Union, participated in Thursday’s demonstration. The Teamsters union reported that thousands of Amazon employees were implicated in the United States.

Amazon Strike at 10 Locations

Overall, the group claims to represent “nearly 10,000” Amazon strikers, having signed up thousands of people at roughly ten locations across the country, many of whom have joined in recent months.

The organization has claimed recognition from Amazon going on strike, claiming the firm illegally neglected its obligation to bargain collectively over salary and working conditions.

The Teamsters is a long-standing US union with nearly one million members. It is well-known for securing lucrative contracts for its members at companies like delivery behemoth UPS.

Most of the Teamsters’ Amazon campaigns have concerned drivers working for third-party delivery companies that partner with the tech behemoth.

Amazon denies that it is liable as an employer in those circumstances, which is a point of legal contention. In at least one case, labour officials have taken a preliminary stance in favour of the union.

Stalled Contract Negotiations

Amazon employees at a major warehouse on Staten Island in New York have also chosen to join the Teamsters. Their warehouse is the only Amazon facility in the United States where labour officials have formally recognized a union win.

However, the Amazon strike is because contract negotiations have not progressed since the 2022 vote. It was not one of the areas scheduled to go on strike on Thursday.

Amazon, one of the largest employers in the United States, has long received criticism for its working conditions and has been the target of activists seeking to gain traction among its employees.

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Amazon Encounters Numerous Strikes As Unions Aim At The Holiday Shopping Surge.

Published

3 days ago

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2024-12-19

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Amazon

(VOR News) – Thousands of Amazon employees at various sites across the country were scheduled to go on strike on Thursday in an effort by the Teamsters union to pressure the retail behemoth to acknowledge its unionised workers in the United States.

The walkout is expected to concentrate on seven Amazon locations across the country during the holiday purchasing surge and may be the most significant union action against Amazon in the nation’s history.

The business announced on Thursday morning that there had been no effect on operations. It also stated that it is “continuing to concentrate on fulfilling customers’ holiday orders.”

The International Brotherhood of Teamsters maintains that it represents more than 10,000 Amazon employees and contractors in aviation centres, warehouses, and delivery centres.

Amazon has refused to acknowledge the union for many years.

The retail giant, which employs approximately 1.5 million individuals, excludes contractors and part-timers. A strike has been initiated by delivery couriers and warehouse employees at seven distinct locations in order to exert pressure on the company to negotiate a collective bargaining agreement that would encompass modifications to compensation, amenities, and working conditions.

Picketing was intended for New York, Atlanta, Los Angeles, San Francisco, and Skokie, Illinois.

Also, the Teamsters assert that they are establishing picket lines at “hundreds” of additional warehouses and delivery centres by encouraging non-unionized workers to picket under U.S. labour law, which protects workers’ ability to take collective action to further their interests.

“Amazon workers are exercising their power,” Randy Korgan stated to NPR.

“They now realise there is a pathway to take on a corporate giant like this – and that they hold the power.” Amazon responds by accusing the Teamsters of fabricating information regarding the strikes, asserting that the participants are “entirely” outsiders rather than employees or subcontractors of the corporation.

Amazon spokesperson Kelly Nantel stated that “the reality is that they were unable to secure sufficient support from our employees and partners and have invited external parties to harass and intimidate our team.” For more than a year, the Teamsters have been intentionally misleading the public by claiming to represent “thousands of employees and drivers.” They do not.

The Teamsters did not provide a specific duration for the strike; however, they informed NPR that it would extend beyond one day. Workers would receive $1,000 per week in strike money, as per the union.

Teamsters President Sean O’Brien issued a statement in which he stated, “If your package is delayed during the holidays, you can attribute it to Amazon’s insatiable greed.” We established a firm deadline for Amazon to attend the meeting and treat our members equitably. They disregarded it.

The Teamsters granted until December 15 to convene with its unionised employees and develop a collective bargaining agreement.

Amazon has opposed all unionisation efforts in court, asserting that unions were not advantageous to its employees and emphasising the compensation and benefits that the organisation currently provides.

Amazon has been accused of discriminatory labour practices on numerous occasions, including the termination of labour organisers. Furthermore, it has disputed its official status as a contract employer.

Teamsters organize Amazon delivery couriers and other employees.

In June, Amazon established its first unionised warehouse in Staten Island, New York, two years after making history by voting to join the fledgling Amazon Labour Union, which is also affiliated with the Teamsters.

The union is one of the most influential in the United States and Canada, with 1.3 million members. On Thursday, the German United Services Union declared that Amazon employees in Germany would participate in a strike in conjunction with their American counterparts.

In the past, Amazon has experienced demonstrations in Germany and Spain that were related to the holiday season in order to advocate for improved wages and working conditions.

“The holiday season has arrived.” Delivery is anticipated. Patricia Campos-Medina, the executive director of Cornell University’s Worker Institute, asserts that “this is the moment in which workers have control over the supply chain.”

The Teamsters have reported that Amazon’s profits have increased both during and after the pandemic. The corporation is currently valued at over $2.3 trillion, with net income of $15 billion in the most recent quarter alone. It is the second-largest private employer in the United States, following Walmart.

SOURCE: NPR

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