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You're right. I read on CBC News this morning that Newfoundland are saying this could last until November for them. It's the longest projection I read so far lately. Not good for vacations and travel.
 

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You're right. I read on CBC News this morning that Newfoundland are saying this could last until November for them. It's the longest projection I read so far lately. Not good for vacations and travel.
I think COVID-19 will continue to be a threat well into next winter and into 2021. I think it could come back quite strongly along with seasonal flu.

I am a frequent traveller (normally) and quite healthy, but I would not dream of buying a plane ticket to anywhere, even for next year. Not until we have a better grasp on this disease.

But things could change. With extensive testing, including antibody tests, we might find that everyone already basically has it. If that's true it would tell us that the disease is actually not extremely dangerous (to healthy people) and then we can all return to life as normal.
 

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I bought Air Canada when it dropped to about $13ish recently, and am still holding it. My thinking was that there's no way the Canadian government would let this company go under. In addition to that, I felt that the price had too much emotion priced into it. Of course, there's a legitimacy to it in the sense that future earning have dropped, but I think the market over corrected with too much emotion packed in. What do you guys think? Is this a good buy moving forward? Or should I sell off and take the profits.
 

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They didn't let it go under before, but it doesn't mean shareholders won't be wiped out. At least you got it at a slight discount to book, but there is no value in the current price for me.
 

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james4beach said:
I think COVID-19 will continue to be a threat well into next winter and into 2021
When AC initially announced the first batch of layoffs, they informed the pilots not to expect a recall until spring of 2021 at best.
 

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AC is retiring 79 tails. All E190, 767 and 319 parked as of today. This will have an enormous ripple effect on the industry.

Wow is all I can say.
 

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I hear a lot from new investors about buying AC stock recently. I shudder. I'm surprised the stock is above $10. It's currently trading at a premium to book value.
 

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AC is retiring 79 tails. All E190, 767 and 319 parked as of today. This will have an enormous ripple effect on the industry.
Can you tell us what this means? Does this mean all E190, 767, 319 are done flying permanently? Or would they bring them back if business improves?
 

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I read somewhere that those planes were being used as a stopgap for the 737 max. No need to keep them running without any demand, may as well retire them and deal with it later. That said, there was a bloomberg article where Air Canada is saying they expect this to be felt for at least 3 years. They're predicting large staff cuts as well....
 

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Can you tell us what this means? Does this mean all E190, 767, 319 are done flying permanently? Or would they bring them back if business improves?
This is permanent. It is also not a stopgap for the max. The E190's are parked immediately. The 767 and 319 with be "out in time" according to the CEO.

AC is expecting +24 MAX and +14 220s in 2020. Thus net -41 aircraft. There is an equipment bid for pilots and you can expect layoffs dating back into 2017/2018 once the bid is complete.

That being said, AC really only requires a few hundred pilots today. They are just burning money, so I would not be surprised if the layoffs go deeper.
 

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This is permanent. It is also not a stopgap for the max. The E190's are parked immediately. The 767 and 319 with be "out in time" according to the CEO.

AC is expecting +24 MAX and +14 220s in 2020. Thus net -41 aircraft. There is an equipment bid for pilots and you can expect layoffs dating back into 2017/2018 once the bid is complete.

That being said, AC really only requires a few hundred pilots today. They are just burning money, so I would not be surprised if the layoffs go deeper.
Unbelievable.

I had a vivid 'air travel' dream last night. In a smallish plane, something like a CRJ, approaching the Greater Toronto Area... I was watching our position over the lake.

Back on the stock... I'm also surprised that the price isn't much lower.
 

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I hear a lot from new investors about buying AC stock recently. I shudder. I'm surprised the stock is above $10. It's currently trading at a premium to book value.
I agree - What would anyone even consider it. Last time they failed, I think that even the bond holders lost all or part of their investments. As with Alitalia, best solution may be to nationalize AC. Maybe offer others like Westjet , Transat etc alternative bailouts, perhaps equity based.
 

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Imagine....government takes on operations end of year....mass layoffs....no pensions....stock goes to zero. Would that surprise anyone really.
 

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What is the new debt that AC is issuing today? Is this to finance the Air Transat buyout?


announced that it has commenced a marketed public offering of Class A Variable Voting Shares and/or Class B Voting Shares of the Company ("Shares") for gross proceeds of approximately C$500 million [ ... ] and a concurrent marketed private placement of convertible senior unsecured notes ("Convertible Notes") for gross proceeds of approximately US$400 million
Going on for $1B of new money for "general corporate purposes". I suspect they'll need it to keep running, but it seems like a lot to ask investors for unless they have a specific acquisition in mind.
 

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They released information to employees a while back that they were burning roughly $22M per DAY with the current operation.

Aside from that, I don't have anything else to add. I'm curious too.
 

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$1B buys them 45 more days of burning through money. They should have laid everyone off faster. AC isn't worth considering above $10 and maybe not even above $7-8 - 50% to book value after writedowns is needed before even bothering to look further.
 
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