Air Canada Intends to Extend and Expand Commercial Agreement with PAL Airlines

Executive Summary

• Air Canada and PAL Airlines signed a letter of intent to extend their regional partnership for an additional four years, through 2032.
• The agreement will increase the number of PAL‑operated Dash 8‑400 aircraft serving Air Canada Express from six to eleven.
• Expansion aims to protect and grow regional air service in Eastern Canada (Québec, New Brunswick, Atlantic provinces).

Key Details

• Extension Term: Existing partnership extended by four years, now running until 2032.
• Fleet Increase: PAL Airlines’ fleet covered under the agreement will rise by five Dash 8‑400 aircraft, bringing total to eleven aircraft operating on behalf of Air Canada Express.
• Geographic Focus: Additional capacity will serve routes originating in Montréal and other destinations across Québec, New Brunswick, and Atlantic Canada.
• Letter of Intent: The parties have signed an LOI; final terms remain subject to negotiation and regulatory approvals.
• Strategic Rationale (Air Canada): Protect existing services, enhance regional connectivity, and support growth of the Air Canada Express network in Eastern Canada.
• Strategic Rationale (PAL Airlines): Strengthen PAL’s presence in Eastern and Atlantic Canada, provide flexible solutions for regional connectivity, and solidify its role as a key partner to Air Canada.

Notable Quotes

• “Air Canada is committed to regional connectivity… 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.” – Mark Galardo, EVP & Chief Commercial Officer, Air Canada.
• “PAL Airlines is proud to work on expanding our agreement with Air Canada… this proposed extended arrangement … reflects their confidence in our operation, supports the continued growth of our airline, and will solidify our presence in the regions which have supported our development.” – Calvin Ash, President, PAL Airlines.