- Air Canada plans to extend its Air Canada Express partnership with PAL Airlines through 2032
- The extension will add four years to the existing agreement, increasing the number of PAL Airlines from six to eleven
- PAL Airlines began operating for Air Canada Express in 2023
- Air Canada and PAL Airlines have signed a letter on intent for regional routes in Eastern Canada and Quebec
Proposed Air Canada agreement will expand PAL Airlines Partnership through 2032
Air Canada (TSX:AC) is doubling down on regional connectivity in Eastern Canada. The company is announcing plans to significantly expand its commercial agreement with PAL Airlines. The move underscores the flag carrier’s long-term commitment to smaller markets amid an evolving aviation landscape.
Under a newly signed letter of intent, Air Canada and PAL Airlines aim to extend their existing partnership by an additional four years. With the extension, the agreement’s horizon moves to 2032. The deal would also expand the number of PAL-operated aircraft flying on behalf of Air Canada from six to eleven. This adds five Dash 8-400 turboprops dedicated to regional routes across Quebec and Eastern Canada.
While final negotiations are still underway, the proposed expansion signals confidence in a partnership that began in 2023. Since that time, the arrangement has become a key pillar of Air Canada’s regional network.
Implications for Passengers & Communities
For Air Canada, the agreement addresses a strategic priority: maintaining reliable service to smaller communities.
“Air Canada is committed to regional connectivity,” said Mark Galardo, Executive Vice President, Chief Commercial Officer, and President of Cargo at Air Canada in a press release. “Our proposed agreement with PAL Airlines will enable us to protect existing services from Montréal to destinations in Québec and New Brunswick and support the overall growth of our regional network.”
Accordingly, for communities in Quebec, New Brunswick and across Eastern Canada, the deal offers transportation reassurance. By doing this, the airline will maintain and potentially expand travel routes essential for business, healthcare and tourism.
Part of a Bigger Air Canada Playbook
In addition, the PAL agreement also fits within Air Canada’s broader corporate narrative. The airline remains Canada’s largest carrier, founding member of StarAlliance, and a Four-Star Skytrax-rated airline. The domestic feeder network can help to support its diversified portfolio. The portfolio spans across passenger travel, Aeroplan loyalty, Air Canada Vacations and Air Canada Cargo.
Considering the airline continues to pursue its long-term climate ambition of net-zero greenhouse has emissions by 2050. The use turboprops like the Dash 8-400 may also play a role by reducing emissions on shorter segments compared to larger jets.
Air Canada is Canada’s largest airline with a presence in more than 180 airports in Canada, the United States and internationally across six continents.
Air Canada stock (TSX:AC) is currently trading at C$19.66 and is up 1.55 per cent since the year began.
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