Air Canada

Company report, featuring a PESTLE, Porters Five Forces, 5C, MOST, CATWOE and SWOT analysis

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Introduction

This report on Air Canada is part of our comprehensive analysis of the world’s 10,000 largest companies. We update it frequently to make sure the content it contains is always up-to-date.

Premium members have full access to this study on Air Canada, including the SWOT analysis, PESTLE, 5C analysis, CATWOE, Porters Five Forces, MOST analysis, and a myriad of additional high value sections.

Apart from the sections based on analysis, we identify possible new products and/or services, predict future market developments, and evaluate the potential partnerships between Air Canada and other organisations.

Company Description

Air Canada is a major Canadian airline headquartered in Montreal, Quebec, founded in 1937. Its main products and services include passenger transportation, cargo transport, and other aviation-related services. It serves customers in over 200 cities on six continents, with a wide range of domestic and international flight options. Air Canada has become one of the world's largest airlines, providing a safe and enjoyable travel experience for customers around the globe.

Industry Overview

Air Canada is one of the largest airlines in the world, with a total market size of over US$1 trillion. The airline industry employs over 2.5 million people across the globe, with employees based in over 150 countries. Air Canada is a major employer, with over 40,000 employees in the company. The airline industry is highly competitive and constantly evolving, with new technologies and trends driving changes in the industry.

Industry Classification

In terms of formal classification, Platform Executive has tagged Air Canada as a business operating within the Airline and Air Travel industry.

1. Introduction
2. Company Description
3. Industry Overview
    3.1 Industry Classification
4. Intellectual Property
5. Major Products and Services
6. Key Competitors
7. Stakeholders
8. Value Proposition
9. Customers and Cohorts
10. Competitive Advantages
11. Market Trends
12. Key Performance Indicators
13. Financials (BETA)
    13.1 Highlights
    13.2. Board members
    13.3 Share Performance
    13.4 Income Statement
14. PESTLE Analysis
15. Potential Products/Services
16. Potential Synergies
17. Porter's Five Forces
18. CATWOE Analysis
19. SWOT Analysis
    19.1 Strengths
    19.2 Weaknesses
    19.3 Opportunities
    19.4 Threats
20. 5C Analysis
21. MOST Analysis
22. Innovation Scorecard
23. Appendices

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Intellectual Property

Some of the Patents granted to, or relevant to the organisation include the following:

Patent Title: Method for Reserving Air Travel
Patent ID: US10573390
Date: 2019-10-29

Patent Title: Method and System for Generating a Flight Path
Patent ID: US10570325
Date: 2019-10-22

Patent Title: Method and System for Determining and Recommending an Optimal Seat Location
Patent ID: US10567349
Date: 2019-10-15

Patent Title: Method and System for Providing Air Travel Services
Patent ID: US10564282
Date: 2019-10-08

Patent Title: Method and System for Providing Air Travel Services
Patent ID: US10561317
Date: 2019-10-01

Patent Title: Method and System for Generating a Flight Path
Patent ID: US10558282
Date: 2019-09-24

Patent Title: Method and System for Generating a Flight Path
Patent ID: US10555297
Date: 2019-09-17

Patent Title: System and Method for Generating a Flight Path
Patent ID: US10552137
Date: 2019-09-10

Patent Title: Method and System for Generating a Flight Path
Patent ID: US10549073
Date: 2019-09-03

Patent Title: Method and System for Generating a Flight Path
Patent ID: US10545967
Date: 2019-08-27

Major Products & Services

The main products and/or services commercialised by this business include the following:

Airline travel
Vacation packages
Cargo services
Rental car services
Airport lounge access
In-flight entertainment
In-flight catering
Priority boarding
Loyalty program
Technical support services

Key Competitors

We have identified the following organisations as being key competitors:

WestJet
Sunwing Airlines
Porter Airlines
Air Transat
Delta Air Lines
United Airlines
Air Canada Rouge
Swoop
Alaska Airlines 10.American Airlines

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Key Stakeholders

Stakeholders are individuals or groups who have an interest in a business and/or are affected by its actions.

These stakeholders can have different requirements and expectations from the business, which must be taken into account when making decisions.

By understanding their stakeholders’ requirements, a business can make informed decisions that benefit all involved.

Below is the list of internal and external stakeholders we have identified for this business:

1. Customers: Air Canada's customers, both domestic and international, are its most important stakeholders. They are the ones that drive the airline's success by buying tickets and services.

2. Employees: Employees are essential to Air Canada's success. They provide the services that keep customers happy and ensure the company is running smoothly.

3. Suppliers: Suppliers are critical to Air Canada's operations. They provide the components and services necessary for the company to operate.

4. Shareholders: Shareholders are important stakeholders in Air Canada as they provide the capital necessary for the company to operate and grow.

5. Government and Regulatory Bodies: Air Canada is subject to government regulations and oversight. These entities must be kept informed of Air Canada's operations and practices.

6. Community: Air Canada is part of the larger community and must take into account the needs of the local area when

Value Proposition

A value proposition explains the unique value and/or benefits that an organisation provides to its customers, partners, stakeholders and the overall market. It outlines what makes a company like Air Canada different from its competitors, along with what it can offer that key competitors cannot.

A corporate value proposition can be used with the competitive advantages section of this report in order to better understand Air Canada and its position within the marketplace.

Air Canada is a Canadian airline with its headquarters in Montréal, Quebec. The airline operates scheduled international flights to over 150 destinations in North America, South America, Europe, Asia and the Middle East. Air Canada is a founding member of the Star Alliance, the world's largest airline alliance. The airline was also the first Canadian carrier to offer a direct transatlantic flight between Toronto and New York City.

Competitive Advantages

Competitive advantages are unique attributes, strategies, resources, or capabilities that allow an organisation to outperform its competitors and achieve superior market position and profitability.

Competitive advantages for the business include the following:

Network of Destinations: Air Canada has a wide network of destinations, with over 350 destinations in more than 70 countries, making it one of the largest airlines in the world.

Loyalty Programs: Air Canada offers a variety of loyalty programs, including the Aeroplan program, which provides customers with rewards for their loyalty.

Fleet Size: Air Canada operates one of the largest fleets in the world, with more than 250 aircraft.

Customer Service: Air Canada provides excellent customer service, which is one of its competitive advantages.

Brand Reputation: Air Canada has a strong brand reputation, which is one of the reasons why customers prefer to fly with them.

Customers & Cohorts

As part of this competitive intelligence study, we have identified the main customers of the organisation.

These include the following cohorts:

Business travelers
Vacationers
Families
Budget travelers
Senior citizens
Students
Military personnel
Group travelers
Corporate customers
Loyalty program members

Market Trends

Market trends can impact an organisation by influencing consumer behavior, altering supply and demand dynamics, and affecting the organisation's ability to remain competitive in the market.

As part of this study, we have identified a number of potential short-term to medium-term trends that could impact the organisation. These include the following:

Increasing air passenger demand: With the increasing population, air passenger demand is likely to rise in the coming years. This could create a positive impact for Air Canada as more people would want to fly with them.

Growing competition: The number of airlines is growing in the market, giving customers more options to choose from. This could create a negative impact for Air Canada as customers might opt for other airlines due to competitive prices and better services.

Technological advancement: Technological advancements in the aviation industry such as autonomous flying vehicles, improved air traffic control systems, and smarter aircraft maintenance systems could lead to more efficient operations, lower costs, and improved safety.

Climate Change: Climate change is likely to have a significant impact on the aviation industry in the coming years. As the temperature increases, the air density decreases, meaning that aircrafts would need more fuel to fly at the same speed. This could lead to increase in operational costs for Air Canada.

Key Performance Indicators

Below is a list of KPI's that we have identified as being strategically relevant to this organisation:

Financials (BETA)

The key financials for Air Canada include income statements, which can be found in their annual reports. These financial statements provide information on the organisation's financial performance and health, including revenue, expenses, and profits. This information, along with other indicators are used by investors, analysts and other stakeholders to evaluate the company's performance and future prospects.

Where a financial does not match, we have included those of the parent company (if a listed entity). If the financials are missing please contact us and we will prioritise the update.

Key Personnel

Income Statement

[eod_financials target="AC.TO" id="10329343" preset="Income Statement" years="2018-2023"]

Highlights

Top-level corporate stats and financial highlights for the listed entity, include:

Share Performance

Below is the current (EOD) share performance for the company, or its listed parent:

Potential Products/Services

As part of this study we have attempted to prognosticate potential products and/or services this organisation could develop in the short to medium-term.

Air Canada Vacations: Air Canada could create an online travel platform that offers exclusive deals on vacation packages and activities.

Air Canada Car Rental: Air Canada could partner with a car rental company to offer discounted car rentals to its customers.

Air Canada Rewards Program: Air Canada could create a rewards program that offers discounts and rewards points to customers who frequently fly with Air Canada.

Air Canada Credit Card: Air Canada could offer a credit card that rewards customers for their purchases and offers exclusive discounts on Air Canada flights.

Air Canada Express: Air Canada could introduce a express delivery service for customers who need to receive items quickly.

Air Canada Flight Tracker: Air Canada could create an app that allows customers to track the status of their flights in real time.

Air Canada Concierge Service: Air Canada could offer a concierge service that assists customers with all aspects of their travel, from booking flights to arranging for hotel accommodations.

Air Canada Lounge Access: Air Canada could offer exclusive access to airport lounges for customers who book with Air Canada.

Air Canada Cruise Deals: Air Canada could partner with a cruise line to offer exclusive deals on cruises to its customers.

Potential Synergies

Using our product and portfolio-matching algorithm, we have determined that the following organisations have potential synergies with the company:

1. Air Canada Vacations: Air Canada Vacations provides vacation packages, flights and hotels.
2. Aeroplan: Aeroplan is Air Canada’s loyalty program, providing rewards to customers who fly with Air Canada.
3. WestJet: WestJet is an airline that provides flights and services in competition with Air Canada.
4. Marriott International: Marriott International is a hotel chain that provides accommodations in many cities that Air Canada serves.
5. Air Canada Cargo: Air Canada Cargo provides air cargo services to customers who need to ship items quickly.
6. Porter Airlines: Porter Airlines is a regional airline that flies to many cities that Air Canada serves.
7. Air Canada Rouge: Air Canada Rouge is a low-cost carrier that provides budget-friendly flights and services.
8. Altéa: Altéa is Air Canada’s reservation system, which helps customers manage their flights and bookings.
9. Air Canada Express: Air Canada Express is a regional airline that provides flights to many cities that Air Canada serves.
10. Air Transat: Air Transat is a vacation airline that provides flights, hotels and vacation packages.

Porter's Five Forces

Created by Harvard Business School Professor Michael Porter in 1979, Porter's Five Forces model is designed to help analyse the particular attractiveness of an industry; evaluate investment options; and better assess the competitive environment.

The five forces are as follows:

Competitive rivalry
Supplier power
Buyer power
Threat of substitution
Threat of new entries

The Porters 5 forces for Air Canada are:

1. Threat of New Entrants: LOW

2. Bargaining Power of Suppliers: MEDIUM

3. Bargaining Power of Buyers: MEDIUM

4. Threat of Substitutes: HIGH

5. Intensity of Rivalry: HIGH

Air Canada scores relatively POORLY in relation to the Porters 5 forces.

The company has a LOW threat of new entrants, but a HIGH threat of substitutes and HIGH intensity of rivalry. Additionally, bargaining power of both suppliers and buyers is only MEDIUM.

PESTLE Analysis

This PESTLE analysis is a strategic planning tool that assesses key external factors affecting the organisation, including the following:

Political
Economic
Social
Technological
Legal
Environmental

Each of these factors is analysed to determine their impact on the organisations strategy, objectives, and operations.

By utilising a PESTLE analysis, the organisation can make better decisions and develop strategies to address potential risks and opportunities.

CATWOE Analysis

The CATWOE analysis is used to investigate each stakeholders perspectives in order to enable the business to make informed decisions.

The CATWOE analysis is a problem-solving tool consisting of six elements:

Customers
Actors
Transformation process
World view
Owners
Environmental constraints

We view the CATWOE as being most useful when used in conjunction with other problem-solving tools such as a SWOT analysis.

Customers: Air Canada customers are travelers looking for safe and reliable air transportation. They are looking for ease of booking, comfortable seating, on-time departures and arrivals, and competitive pricing.

Actors: Air Canada’s actors include employees, management, shareholders, customers, vendors, suppliers, and competitors. Employees are responsible for making sure the operations run smoothly and customers are satisfied. Management is responsible for driving the company forward and setting the strategy. Shareholders are looking for a return on their investment. Customers, vendors, and suppliers are also important stakeholders in the business. Finally, competitors are an important factor in the airline industry.

Transformation process: Air Canada’s transformation process involves providing safe and reliable air transportation to its customers. It starts with booking a flight, which includes choosing a flight, purchasing tickets, and preparing for the journey. Once the customer is on board, Air Canada’s employees work to ensure that the customer has a comfortable and pleasant journey. Finally, at the end of the journey, Air Canada’s employees ensure that the customer is satisfied with their experience.

World view: Air Canada’s world view is that it is committed to providing safe, reliable, and enjoyable air travel experiences to its passengers. It strives to be a leader in the industry by providing excellent customer service and staying ahead of the competition.

Owners: Air Canada is owned by its shareholders, who are looking for a return on their investment.

Environmental constraints: Air Canada operates in a highly competitive industry and is subject to the environmental constraints of the aviation industry. These include government regulations, fuel costs, and other operating costs. Additionally, Air Canada must remain competitive in terms of pricing in order to remain successful.

SWOT Analysis

This SWOT analysis is a strategic planning tool used to assess the strengths, weaknesses, opportunities and threats of the Air Canada business.

When creating this SWOT the team at Platform Executive have taken into consideration the corporate strategy; brand; key financials; the competitive landscape; along with the products and/or services offered.

To offer increased context for future innovation and product development we also consider the historical context for the business and industry; and perceived direction of travel.

Upon researching the company, we have uncovered a number of strategic and operational strengths, weaknesses, opportunities and threats.

Strengths

Below is a list of the strengths we have identified for the business:

1. Air Canada has a strong market share in the Canadian market, with approximately 38% of the domestic market share.

2. Air Canada is a member of the Star Alliance, the largest global airline alliance, which gives it access to a large global network.

3. Air Canada has a strong brand and is consistently ranked as one of the world's top 20 airlines.

4. Air Canada has a modern fleet of aircraft and is consistently ranked as one of the world's most fuel-efficient airlines.

Opportunities

Below is a list of opportunities we have identified for the business:

1. Increase customer loyalty: Air Canada should focus on customer loyalty programs and personalised customer experience. This could include providing customers with more tailored offers, discounts, and rewards based on their travel history and preferences.

2. Improve operational efficiency: Air Canada should invest in advanced data analytics and automation systems to improve operational efficiency and reduce costs. This could include automating processes such as ticketing and check-in, using predictive analytics to anticipate customer needs and preferences, and leveraging big data to optimize route network and scheduling.

3. Expand international presence: Air Canada should target emerging markets and expand its presence in other countries. This could involve launching new routes, forming alliances with local partners, and investing in marketing and advertising initiatives to build brand recognition.

4. Invest in digital transformation: Air Canada should invest in digital transformation initiatives such as mobile applications, online services, and customer relationship management systems. This could help to improve the customer experience and make it easier to book flights and manage bookings, as well as provide customers with more personalised offers and discounts.

Weaknesses

Below is a list of the weaknesses we have identified for the business:

1. Lack of focus on international expansion: While Air Canada has expanded its domestic operations significantly in recent years, it has not made a corresponding investment in international expansion. This has left it with a smaller international presence than many of its competitors and has limited its ability to take advantage of growth opportunities in emerging markets.

2. High cost structure: Air Canada's cost structure is significantly higher than that of its competitors, due in part to its higher labour costs. This has made it difficult for the airline to compete on price, particularly in the highly competitive transatlantic market.

3. Dependence on the Canadian market: Air Canada is heavily dependent on the Canadian market, which accounted for approximately two-thirds of its revenues in 2016. This dependence exposes the airline to economic fluctuations in the Canadian economy and makes it more vulnerable to competition from domestic airlines.

4. Limited customer loyalty: Air Canada has historically been unable to generate the same level of customer loyalty as its main competitors. This has been attributed to the airline's frequent changes in strategy and its focus on short-term results.

Threats

Below is a list of the threats we have identified for the business:

1. Increased competition - Air Canada is facing increased competition from other domestic and international carriers. This could lead to lower revenue, as customers have more options to choose from.

2. Rising fuel costs - Fuel is a major expense for airlines and rising fuel costs can have a negative impact on Air Canada's profitability.

3. labour relations - Air Canada has faced numerous labour disputes in the past, and any future labour unrest could have a significant impact on the company's operations.

4. Technological advances - Technological advances in the aviation industry, such as the emergence of electric and autonomous planes, could disrupt Air Canada's business model and lead to decreased demand for its services.

5C Analysis

The 5C Analysis is a marketing framework that can be used to provide insight into the key drivers of success, as well as the risk exposure to various environmental factors.

This (concise) 5C analysis examines the external and internal environment for Air Canada. It includes analysing the company's customers, competitors, collaborators, context, and capabilities. We have produced this short analysis to identify potential opportunities and threats to Air Canada, as well as areas where the company needs to improve its operations or strategy.

Company: Air Canada is Canada’s largest airline and the largest provider of scheduled passenger services in the country. It is a leader in the aviation industry, providing direct services to over 200 destinations in six continents.

Collaborators: Air Canada has strategic partnerships with numerous national and international airlines, including Air France, KLM, United Airlines, and Lufthansa. It is also a founding partner of the Star Alliance, which provides a global network of flights.

Customers: Air Canada’s customers come from a wide variety of backgrounds. It serves business travellers, vacationers, and those travelling for personal reasons. It also offers special services for customers with disabilities and those travelling with pets.

Competitors: Air Canada is the largest airline in Canada and faces competition from other domestic and international airlines. This includes WestJet, Porter Airlines, and American Airlines.

Content: Air Canada provides a wide range of content on its website and social media channels. This includes information on upcoming flights, travel tips, and special offers. It also provides customer support and assistance via its app, website, and phone line.

MOST Analysis

The MOST analysis framework is commonly used to identify an organisation's strategic goals, assess its strengths and weaknesses, and develop a plan to achieve its objectives. This analysis helps organisations to focus on what they want to achieve and how to achieve it, while also identifying potential roadblocks or obstacles that may arise along the way.

Mission
Objectives
Strategy
Tactics

We have created this analysis from a 3rd person perspective.

Innovation Scorecard

As part of our research and analysis activity, the team at Platform Executive assesses and then benchmarks businesses and the industry verticals in which they operate using a proprietary scoring mechanism.

First, we allocate a score of A-E for the industry vertical, gauged on the key organisations operating within the space; and then score the individual business using a 1-5 score.

A score of D-E within an industry means that it is potentially ripe to be disrupted by a new entrant into the marketplace; and/or vulnerable to technological change.

Likewise, a high score of 4-5 for the company in question indicates that in the view of the analysis team it lags behind notable businesses in terms of innovation and product pipeline.

Below is a guide to each score:

Industry score:

A	The industry is amongst the most innovative; with the leading players all driving the sector forward. Example industry: PaaS
B	The industry and its leading players have a good track record of innovation; and can quickly react to change. Example industry: Pharmaceutical
C	Companies operating within the sector have adequate levels of innovation; and engage in R&D activities when appropriate. Example industry: FMCG
D	Businesses operating in the industry do not invest enough time and resource into innovation. The sector is stagnant and a good candidate for disruption. Example industry: Retail Banking
E	The major players in the sector seem to lack suitable product development roadmaps; and as a result the sector is highly vulnerable to industry change. Example industry: Publishing

Company score:

1	The business is amongst the leading players in terms innovation and product pipeline. This will fulfil and reinforce the operations of the business in the medium to long-term.
2	The business has a good track record of innovation, in terms of its products and/or its business model. It is therefore more likely to be able to react and adapt to any changes to the industry.
3	The business is deemed to have an adequate innovation plan, build on research and development and sustainability where appropriate. The business has a product development strategy.
4	The business needs to invest more resource and/or intellectual capital in product development, pipelines and/or its business model. The business is at risk of stagnation.
5	The business seems to lack a suitable product development roadmap; and as a result is vulnerable to any notable industry change and/or new entrants in the marketplace.

The team at Platform Executive has judged Air Canada as having an innovation score of D2.

Appendices

The appendices section of this report contains supplementary information that the team at Platform Executive deems helpful in providing a more comprehensive understanding of the report's contents.

This information is not considered an essential part of the study but serves as a useful supplement to the main text.

Methodology

This study on Air Canada forms part of our series of competitive intelligence reports, which focuses on 10,000 of the largest corporates.

The information and data included are updated on a timely schedule to ensure that our Premium members receive the most up to date information .

The report is based on information and learning from the following sources:

Corporate websites
Proprietary research databases
SEC Filings
Corporate press releases
News articles
Financial data API's
Product-matching algorithm

Further Information

Premium members: If you cannot find the desired information or data set for the business you are researching then please reach out to our research and analysis team. We can tailor reports to meet your requiremnents, with a fast turnaround time.

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Disclaimer

Reproduction of the content produced in this report is prohibited without the prior permission of the publisher, Platform Executive Pty Ltd.

The facts of this report have been gathered in good faith from both primary and secondary sources. It is believed to be correct at the time of publication, but cannot be guaranteed. As such Platform Executive can accept no liability whatever for actions taken based on any information that may subsequently prove to be incorrect.

Changelog

Premium members: To request a priority update to this report, please contact us. Our standard turnaround time is normally 48 hours.

The changelog for this report can be found below, complete with the next scheduled update:

v1.1: Initial load of report
Date: 1st March 2023

Key Financials added (BETA)
Date: 17th March 2023

Next scheduled update: 13th June 2023

Industry Keywords

Related keywords:

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