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Alberta's Aviation Heritage
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Industry Difficulties

"No Frills" Airlines


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Passenger Airlines (1980-Present)

Westjet B-737 passenger planeIn 1974, the Alberta government purchased a controlling share in Pacific Western Airlines (PWA), because there were indications that the NDP government in British Columbia was about to take control of the airline. The head office of PWA was moved to Calgary, and the maintenance works relocated to Edmonton. In 1983, the Alberta government changed its policy and sold its controlling share in the airline.

By the 1980s the mood had changed and many wanted deregulation, which came into being in 1987. Pacific Western Airlines merged with other small airlines and formed Canadian Airlines, a new competitor with Air Canada. There was a period of rapid expansion and optimism among the large airlines in Canada, but there were also unforeseen changes, including an economic down turn in Asia, that affected Canadian Airlines' profitability. At the same time, Air Canada faced new challenges from other airlines.

By the 1990s, both airlines were facing increasing debt as they faced a reality of rising costs and fewer passengers. Competition from the low cost, no frills airline, West Jet, had an impact as well. Several attempts were made to merge Canadian Airlines and Air Canada as a result. Following changes in the regulations by the federal government in 1999, the two airlines merged under the Air Canada banner.

The new and larger Air Canada continued to face trouble with increasing debt. New no frills airlines emerged, threatening Air Canada, bringing it to seek bankruptcy protection on April 1, 2003. After considerable restructuring, Air Canada emerged from bankruptcy protection on September 30, 2004.

Air Canada continues to face competition and a new way of doing business with the ongoing success of discount airlines like WestJet and Jetsgo.

Air Canada has responded by creating a series of discount air services that included AC Jetz, Zip, Tango, and Jazz, its own discount carriers. Some of these airlines have continued, while others like Tango only remain as a discount ticket option on regular Air Canada flights.

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Alberta's Aviation Heritage

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