Air Canada Revises 2025 Profit Forecast After Flight Attendant Strike

Air Canada announced it expects a C$375 million ($269.82 million) impact on its operating income following a four-day strike by its flight attendants in August. The labor disruption, led by 10,000 members of the Canadian Union of Public Employees (CUPE), forced the Montreal-based airline to withdraw its previous 2025 outlook. The company has now issued revised financial guidance, reflecting the operational and financial fallout.

According to the new forecast, Air Canada anticipates adjusted core profit in 2025 to range between C$2.9 billion and C$3.1 billion. This marks a downward adjustment from its earlier projection of C$3.2 billion to C$3.6 billion. Additionally, the airline now expects available seat mile capacity to increase between 0.5% and 1%, compared to the prior estimate of 1% to 3%.

The strike, which drew national attention, began after flight attendants defied government attempts to mandate a return to work. The walkout ended when a tentative agreement was reached, but the wage deal was overwhelmingly rejected by union members in September. Despite the rejection, both parties agreed that no further labor disruptions would occur, ensuring that flights would continue without interruption. The unresolved dispute will now be settled through arbitration.

Air Canada’s labor negotiations come at a time when global airlines are navigating rising costs, shifting travel demand, and heightened labor activism. For Canada’s largest carrier, maintaining service stability while addressing employee concerns remains critical to its financial recovery and long-term competitiveness.

The airline’s revised outlook highlights the financial strain caused by labor unrest and underscores the importance of stable labor relations in the aviation industry. As the arbitration process unfolds, investors and travelers alike will be watching closely for signs of resolution and its impact on Air Canada’s operations and profitability.