Air Canada’s corporate strategy made decisions that helped lead to their survival and success. When Air Canada was in trouble in the restructuring strategy was used in order to make changes in the company. The turnaround process included creating low cost carriers like Tango in 2001, which was created after the 911 attack and that had “left airlines around the world struggling for survival” (Webber, 2001). In 2002 After Canada 3000 had gone out of business, Air Canada tried once again to launch a “low-cost carrier called Zip Air Inc” (Webber, 2002). Air Canada was also competing with WestJet Airlines Ltd., which was more profitable at the time. Unfortunately, with the high fuel costs and the “global economic slowdown and its impact on travel”
…show more content…
Customers were unsettled by this transaction, however, it was meant to increase people’s chances of securing a seat, especially since previously there was not enough supply and demand. By 2002 Air Canada had to liquidate and lay off roughly 8,800 workers (Milton, 2016). During this time Air Canada’s service also was lowered since there were fewer flights available, longer lines at the airport (due to not having enough workers), and there were no free meals available for most of the flights, which upset many customers. The employee cuts, including human resource department, did not help Air Canada as they were “still losing millions of dollars” (CBC, 1991). The Human Resource department was affected by the vast turnover and dismissal procedures, which also included HR professionals.
Eventually, Air Canada was no longer able to pay its creditors and loans resulting in the company filing for bankruptcy protection in 2003. This helped Air Canada get a chance to restructure the organization to stay afloat. During this process the company had “lined up $700 million US in special "debtor-in-possession" financing to keep operating” ("Air Canada granted bankruptcy protection",
Customers were unsettled by this transaction, however, it was meant to increase people’s chances of securing a seat, especially since previously there was not enough supply and demand. By 2002 Air Canada had to liquidate and lay off roughly 8,800 workers (Milton, 2016). During this time Air Canada’s service also was lowered since there were fewer flights available, longer lines at the airport (due to not having enough workers), and there were no free meals available for most of the flights, which upset many customers. The employee cuts, including human resource department, did not help Air Canada as they were “still losing millions of dollars” (CBC, 1991). The Human Resource department was affected by the vast turnover and dismissal procedures, which also included HR professionals.
Eventually, Air Canada was no longer able to pay its creditors and loans resulting in the company filing for bankruptcy protection in 2003. This helped Air Canada get a chance to restructure the organization to stay afloat. During this process the company had “lined up $700 million US in special "debtor-in-possession" financing to keep operating” ("Air Canada granted bankruptcy protection",