Air Canada announced ambitious projections for revenue growth, targeting a 36% increase by 2028, driven by a surge in leisure travel demand. This forecast was shared during Air Canada's 2024 Investor Day, where the airline outlined its strategy to leverage the global travel boom, particularly in the leisure sectors. Air Canada's optimism is anchored in the recovery and growth of international travel post the global health crisis, with a significant focus on expanding its network to leisure destinations.
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The airline plans to increase its capacity, especially on routes to Asia-Pacific, Europe, and within North America, where leisure travel has shown robust recovery. The projected revenue for 2028 is expected to reach approximately C$30 billion, up from the current year's forecast. The strategy includes expanding its fleet with 18 new Boeing 787 Dreamliners, which are pivotal for long-haul routes to leisure hotspots. These aircraft will not only increase capacity but also improve efficiency and passenger experience with new cabin configurations, including premium economy seats, which have seen a significant uptick in demand.
Air Canada also plans to introduce more Airbus A220 and A321XLR aircraft for short to medium-haul routes, enhancing connectivity to less-served leisure markets. To capitalize on this growth, Air Canada is not just focusing on expanding its physical assets but also on improving its digital infrastructure. The airline aims to enhance its digital booking platforms, loyalty programs, and ancillary services like in-flight entertainment and Wi-Fi, which are increasingly important to modern travelers. This digital transformation is seen as crucial for capturing the younger, tech-savvy demographic that drives much of the leisure travel market. Moreover, Air Canada is banking on a recovery in business travel, which, while not yet at pre-pandemic levels, is expected to contribute significantly to the revenue surge over the next few years. The airline is optimizing its network to serve business and leisure travelers more effectively, including new routes and increased frequencies on key business corridors.
The airline's CEO, Michael Rousseau, highlighted the importance of this dual focus, stating, "Our strategy is to cater to both the burgeoning leisure travel market and the recovering business sector. This approach will ensure sustainable growth and profitability." However, this growth plan is not without challenges. Air Canada will need to navigate supply chain issues, rising fuel costs, and potential geopolitical tensions affecting travel patterns. The airline has also mentioned plans for operational efficiency improvements and cost management to ensure that revenue growth translates into profitability.