Air Canada (TSX:AC.B) is not going on strike. Well sort of. The machinists and baggage handlers rattled the chains pretty good and made to look like they would go on strike during March break. The union has no PR sense. The Federal government steps in to protect the public during a key travel time. They had no choice. If something had happened and they had not pre-positioned a blocking move the political fallout would have been unacceptably huge. Easy move for conservative party.
But was the union really serious? The travel disruption would have continued for quite some time. The NDP which one can only assume is supported by the unions in question is about to hold its national leadership convention. Delegates from across the country will be flying in to Toronto. If Air Canada goes on strike many delegates would have been seriously inconvenienced.
The spectacle of a left-wing socialist party leadership convention being derailed by a militant union local has been avoided. The welfare of the general public has been placed first.
In the mean time Air Canada continues to be a penny stock with ambitions of acquiring the new Boeing 787 Dreamliner. Shareholder wealth maximization is hard to identify.
George Gutowski writes from a caveat emptor persepctive.
- Ottawa had to step into Air Canada dispute to shield economy, says Harper (business.financialpost.com)
- Raitt blocks March break work stoppages at Air Canada, cites ‘fragile economy’ (macleans.ca)
- Craig’s Take: AC decision sides with management (ctv.ca)