A CPA is an agreement by which an airline underestimates part of its business to another company. This is a fundamental model for the regional air transport market in the United States, as is wet leasing, but generally over longer periods of time. Brands such as American Eagle, Delta Connection and United Express meet the needs of the regional market, without the risk for large airlines to operate a completely different fleet in a completely different market. “Right now, one of our biggest risks is balancing our aircraft leases with the contracts we have. Short-term contracts can leave you with many planes that you no longer need. However.B, airlines like SAS and LOT, which are two of our biggest partners, are slowly changing. I think they have understood that the CPA model in Europe has many advantages for them, because we can generally make things much cheaper than they can. This does not mean that we are realigning their brands, but we have an element that allows us to offer the cost control that we have. “We are very pleased to have secured this win-win agreement with Jazz and Chorus, which will give us long-term stability, greater security of competitive costs and the flexibility needed to modernize the regional fleet for the benefit of our customers.
The amendments will allow us to offer regional services at a lower cost so that we can compete more efficiently, use the most suitable aircraft for a given regional market, and also generate additional traffic to power our international network,” said Calin Rovinescu, President and Chief Executive Officer of Air Canada. “As further evidence of Air Canada`s commitment to a successful long-term partnership, once the CPA amendments come into effect, we will make a $97.26 million interest in Chorus. We are not only coordinating our mutual interests, but also of exceptional value to Air Canada shareholders. “Things are changing. We have found that they will become more open to longer-term contracts with SAS and LOT. It gives us and our owners a little more rest. At the end of the day, we want a situation like North America with longer-term contracts of a decade or more. This would then allow us to think about purchasing decisions; we could go straight to the OEM and cut out the owners completely. “I think it`s time. The capacity provider model [in Europe] differs slightly. It is not so much that you will see the name of the regional airline at the front; I think it`s really about the brand. We see a mix in some major airlines that are not really attentive to this occasion and others that are really suited to this, the big time.
At the time of this development, the purchaser has entered into a contract to purchase or purchase the property (the “property”) described on The Appendix “A-B”, which is attached here, and this mention clearly gives many reasons for European airlines to accept CPAs. It remains to be seen whether they will ever reach the depth of dependence on this service that we see in the United States.