Air Canada Technical Services Secures Contract to Maintain Department of National Defence Airbus A31

Air Canada Technical Services, a division of
Air Canada, today announced that it has secured a five-year,
CAD $101.7 million agreement for the maintenance and repair of Canada`s
Department of National Defence (DND) fleet of Airbus A310 aircraft. The
agreement, effective August 1, 2002, includes five one-year options for
contract extension which, if exercised, would bring the total contract term to
ten years with potential revenue to Air Canada Technical Services of
CAD $250 million.

Maintenance work on the DND`s five Airbus A310 aircraft will be performed
at locations across Canada: Air Canada Technical Services` Vancouver
facilities will handle heavy maintenance, component maintenance will be
executed at its Montreal base and line maintenance will be performed at
Canadian Forces Base facilities in Trenton, Ontario.

“We are proud to provide our expertise to serve our country`s national
defence forces,” said Robin Wohnsigl, President, Air Canada Technical
Services. “With this contract, the Canadian military is demonstrating its
confidence in Air Canada Technical Services to provide the very best in
maintenance repair and overhaul work.”

Air Canada Technical Services provides maintenance, engineering, repair,
supply and purchasing to support Air Canada`s mainline fleet of more than
220 aircraft, as well as other airline customers, in five maintenance
categories: airframes, engines, components, line and aircraft cabins. It also
provides material and supply chain management services to the airline
industry. Air Canada Technical Services employs approximately 8200 staff in
Canada, the U.S. and Europe, with six major maintenance base centers located
across Canada: in Halifax, Montreal, Toronto, Winnipeg, Calgary and Vancouver.