Though Air Canada lost money in the first quarter, executives insist the company remains on an upward swing thanks largely to efforts to boost revenue from business travellers.
And key to those efforts is expansion onto domestic and US flights of the company's formerly international-only business class product called "signature class".
Starting in June, Air Canada will begin selling that product on flights to Toronto from Los Angeles, San Francisco and Vancouver, says president of passenger airlines Benjamin Smith during the company's first quarter earnings call on 30 April.
The company offers signature class, which includes lie-flat seats and a host of other amenities, on Boeing 767s, 777s, 787s and Airbus A330s, Smith says.
The decision to deploy aircraft with lie-flat seats on transcontinental flights mirrors moves made by several US carriers, and reflects Air Canada's efforts to boost profits from high-yielding business-class travelers.
"Investment in our premium customer experience greatly contributed to our first-quarter yields," says Smith.
Air Canada's revenue from business-class passengers jumped C$88 million ($69 million), or 13.8%, year-over-year in the first quarter, he notes.
Based on those figures, the company generated business class revenue of about $726 million in the first quarter.
Likewise, Air Canada's business class yields jumped 4.3% year-over-year in the period, Smith adds.
The business class gains were not enough to push Air Canada to a profit: the company posted a net loss of C$170 million in the first quarter.
Still, executives noted that the first quarter tends to be weak, and say business-class revenue is among reasons Air Canada's first quarter passenger revenue jumped 12% year-over-year to $3.5 billion, a company record.
Companywide yields also inched up 0.4% in the first quarter, and passenger revenue per available seat mile increased 3% year-over-year, Air Canada reports.
As it boosts revenue, Air Canada continues to move forward with a plan wring C$250 million in costs out of the business by 2019.
Chief executive Calin Rovinescu says Air Canada remains on track to reach that goal, having already cut, or identified means to cut, 50% of the total.
Source: Cirium Dashboard
