Canadian Airline Equity Proposal

April 23, 1999


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Canadian Airline Equity Proposal
Canadian Airline Equity Proposal
dated April 23, 1999

A potential crisis at Canadian Airlines can be avoided if the federal government takes the CAW's advice. CAW National President Buzz Hargrove unveiled the union's proposal in an effort to pro-actively avoid a crisis.

Buzz Hargrove
CAW National President

"We've suggested to day that the lifting of the foreign ownership restrictions of 25 per cent can be part of the solution along with the government equity position as a minority partner that allows them to come in, work with the company, work with the industry to deal with some of the problems here. It would mean the long-term viability of Canadian Airlines and a better airline industry in Canada."

Canadian and its employees pay $500 million in federal taxes each year. Hargrove says the government should invest $100 million of that back into the airline each year for the next three years.

Buzz Hargrove
CAW National President

"It ensures an upgrading of the equipment and the product. It ensures training funds for the workers and it ensures the jobs but it also ensure that taxpayers and the consumers that they will continue to have a choice and the government will be forced to look at what's happening in the industry. We think that it will benefit consumers in terms of the pricing policies that are out there today that are controlled totally by the corporations. So we think that at every level there's a plus here with no down side for the company or the government."

Canadian jobs and investment requirements would have to be part of the removal of foreign ownership restrictions.

Jim Stanford
CAW Economist

"Canadian labour costs in this industry are significantly lower than in the U.S. so putting the restriction on a foreign owner to keep that work in Canada is not a significant restriction on his business. The fundamental problems behind Canadian Airlines losses are elsewhere. In our view mostly in the structure of the deregulated industry and the nature of the oligopolistic competition between Canadian Airlines and Air Canada."

CAW "Fighting Back Makes a Difference."


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