Air Canada Implodes


Well, we called this one.

Actually, I called it the day the airline came out of bankruptcy several years ago.

If you want to see what happens to an airline when the financial types pull off a slick version of bankruptcy (one in which inherent problems with an airline are not really changed — but bankers, hedge funds, and airline executives make off with a lot of cash in the process) you need look no further than the sickening situation that began at Air Canada when the airline came out of bankruptcy in 2004 and which will end when the airline ends up back in bankruptcy again. An event which is probably not that far down the road.

This week Montie Brewer, CEO of Air Canada was forced out of the airline as CEO. Technically, he “resigned.” Yes, well, that was only after he was told he was fired.

I don’t blame Montie for the position Air Canada finds itself in today. I blame Robert Milton, the former CEO of Air Canada, and all the rest of that airline’s top executives who made off with a s%^* load of money when the airline came out of bankruptcy in 2004. It was this group, along with the various banks and hedge funds that fueled the airline’s exit, all wrapped around a nice new holding company, ACE Holdings, that is to blame for the situation Air Canada is in today.

Milton was made Chairman, President and CEO of ACE.

Very convenient. And yes, the position has also been very lucrative.

To the bankers, to the hedge funds, and to Milton. And his friends.

And guess what? Two of the members of that Milton brain trust are now back at the top of Air Canada — Calin Rovinescu and Duncan Dee.

In an article in the Globe and Mail, Milton was quoted as saying, “Look at this as Calin’s and Duncan’s chance to make good things happen with a terrible backdrop.”

How so very convenient. I mean, what are friends for anyway?

Air Canada has been on the PlaneBusiness Titanic Watch for more than a year.