(Bloomberg) — Air Canada shares tumbled after the airline warned it may face higher operating costs in 2024 as it works out a new labor agreement with its more than 5,000 pilots.
The adjusted cost per available seat mile — a key measure of airline expenses — may increase 2.5% to 4.5% in 2024, the Montreal-based carrier said in its earnings report Friday. Shares of Canada’s largest airline fell as much as 6.9% in Toronto trading, the most in a year, and traded at C$19.94 at 11:28 a.m.
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Chief Financial Officer John Di Bert said on a conference call with analysts that the company is wrestling with cost headwinds from “lagging inflation” as well as regulatory changes and the pending deal with pilots.
“A new agreement with pilots will bring a change in wages and other cost-related items,” he said. “We have factored our best estimates into our guidance with a view of the Canadian market.”
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