Air Canada Announces 1300 Job Reductions

MONTREAL, Aug. 21 /CNW/ - Air Canada said today that it would reduce its workforce by 1300 jobs on a temporary basis in line with the normal reduction
of capacity to meet the seasonal drop-off in demand during the traditionally
slower fall and winter period. The job reductions, affecting approximately
900 flight attendants (approximately 300 of whom were hired as summer
temporaries) and 400 airport ramp service personnel, will be implemented on a
gradual basis starting on September 30, 2002. The airline will work with the
unions in an effort to reduce the number of seasonal layoffs through various
mitigation programs. The layoffs are temporary and the airline expects to
recall affected employees as necessitated by demand as it did for the 2002
peak summer travel period.

This job reduction is in line with the seasonal capacity adjustment previously indicated and the company still foresees a profitable third quarter and an ongoing improvement in 2002 year-over-year financial results.

Certain statements made in this press release are of a forward-looking nature and are subject to important risks and uncertainties. The results indicated in these statements may differ materially from actual results for a number of reasons, including without limitation, terrorist attacks, war, general industry, market and economic conditions, the ability to reduce operating costs and employee counts, employment relations, labour negotiations, energy prices, currency exchange and interest rates, changes in laws, adverse regulatory developments or proceedings and pending litigation. The forward-looking statements contained in this press release represent Air Canada`s expectations as of August 21, 2002, and are subject to change after such date. However, Air Canada disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.