Air Canada’s declining yields could continue as it prepares for a capacity push in CY2015

Air Canada is planning to grow its CY2015 capacity at higher levels than most of its North American global airline peers as its new low-cost airline rouge has exceeded expectations, which is giving the airline confidence that the lower cost capacity it plans to introduce should help the company reach its medium term cost reduction targets.

The airline is not yet offering unit revenue or yield guidance for CY2015, but given that its focus during the past couple of years has been adding capacity into leisure markets, the decline in yields Air Canada has recorded throughout CY2014 are likely to carry over into CY2015.

As Air Canada prepares for a capacity push in CY2015, it continues to record a solid financial performance in CY2014, posting strong results in 3Q2014 despite falling yields and unit revenues.