unwise
22nd Apr 2002, 12:36
Nav Canada, the country's air-traffic control company, says it is facing a "major crisis" as it deals with a $145-million revenue shortfall and the looming possibility its controllers might strike.
"The true test of a successful business is surviving a major crisis," chief executive officer John Crichton said in a speech at the company's annual meeting in Ottawa yesterday.
"This is our first."
The firm's major cash source is airlines. It charges them per plane for its navigation services. As airlines parked their planes after Sept. 11, a significant portion of Nav Canada's revenue withered away.
Airlines are only now starting to put some of their jets back in the air, and traffic remains about 15 per cent below Nav Canada's expectations, said company spokesman Louis Garneau.
The company also faces a potential strike by its 2,300 air-traffic controllers at airports across the country. The workers' contracts expired March 31.
In a decision last month, the Canada Industrial Relations Board ruled that the workers can delay air travel within Canada to some degree. The board said the controllers cannot take any action that would affect air service to remote locations, to the U.S., or to overseas destinations. Emergency air service must also be maintained.
Talk of Strike Is Premature
Nav Canada said any talk of a strike is premature. It says it has not even received a list of demands from the workers, who are represented by the Canadian Auto Workers Union.
The company, which said it can weather the storm, has cut its costs by $85 million. Most managers have seen their pay scaled back or frozen.
The firm is asking its unionized workers to accept wage freezes through an extension of their contracts to Aug. 31, the end of Nav Canada's fiscal year. Only one union, representing financial administrators, has so far agreed.
"This continues to be a concern," Crichton said. "We hope to be in a position to negotiate new agreements with all bargaining agents, taking into account the seriousness of our financial situation and the need for all stakeholders, including represented employees, to contribute to our mitigation plan."
Crichton said the company's operational integrity "won't be compromised."
Nav Canada boasts one of the best safety records internationally. Since 1996, at the same time air traffic increased by 20 per cent, it maintained an average of about two operating irregularities per 100,000 aircraft movements.
"The true test of a successful business is surviving a major crisis," chief executive officer John Crichton said in a speech at the company's annual meeting in Ottawa yesterday.
"This is our first."
The firm's major cash source is airlines. It charges them per plane for its navigation services. As airlines parked their planes after Sept. 11, a significant portion of Nav Canada's revenue withered away.
Airlines are only now starting to put some of their jets back in the air, and traffic remains about 15 per cent below Nav Canada's expectations, said company spokesman Louis Garneau.
The company also faces a potential strike by its 2,300 air-traffic controllers at airports across the country. The workers' contracts expired March 31.
In a decision last month, the Canada Industrial Relations Board ruled that the workers can delay air travel within Canada to some degree. The board said the controllers cannot take any action that would affect air service to remote locations, to the U.S., or to overseas destinations. Emergency air service must also be maintained.
Talk of Strike Is Premature
Nav Canada said any talk of a strike is premature. It says it has not even received a list of demands from the workers, who are represented by the Canadian Auto Workers Union.
The company, which said it can weather the storm, has cut its costs by $85 million. Most managers have seen their pay scaled back or frozen.
The firm is asking its unionized workers to accept wage freezes through an extension of their contracts to Aug. 31, the end of Nav Canada's fiscal year. Only one union, representing financial administrators, has so far agreed.
"This continues to be a concern," Crichton said. "We hope to be in a position to negotiate new agreements with all bargaining agents, taking into account the seriousness of our financial situation and the need for all stakeholders, including represented employees, to contribute to our mitigation plan."
Crichton said the company's operational integrity "won't be compromised."
Nav Canada boasts one of the best safety records internationally. Since 1996, at the same time air traffic increased by 20 per cent, it maintained an average of about two operating irregularities per 100,000 aircraft movements.