Air Canada began with two passengers flying Vancouver to Seattle for 14 dollars
Canada's national carrier opened for business in September 1937 with a single Lockheed Electra carrying two passengers and some mail from Vancouver to Seattle, charging 14.20 dollars return. It now moves tens of millions of people a year and was the first airline anywhere to ban smoking on every flight.
It started life as Trans-Canada Air Lines, set up by federal law in April 1937 as a subsidiary of the Canadian National Railway. Transport minister C. D. Howe wanted a state-run airline tying the Atlantic coast to the Pacific, and five million dollars of government money bought two Electras and a biplane, with executives hired from United and American. Coast-to-coast service between Montreal and Vancouver began in April 1939, and the first flight attendants had been hired the previous July.
Protection shaped its early decades. When Canadian Pacific proposed a merger in 1942, Prime Minister Mackenzie King refused and instead gave TCA a legal monopoly on transcontinental flights. Headquarters moved from Winnipeg to Montreal in 1949, and in 1953 its ReserVec system made it the first airline to book seats by computer through remote terminals. Jean Chrétien pushed a bill to adopt the French name the airline already used, and it became Air Canada on 1 January 1965.
Deregulation arrived gradually through the late 1970s and 1980s. The airline became an independent Crown corporation in 1976, went smoke-free across its fleet in December 1987, and was fully privatised by 1989. A slump after the Gulf War prompted a former Delta executive, Hollis Harris, to cut management, and profits returned by 1994. In 1997 it helped found the Star Alliance.
Swallowing its biggest rival, Canadian Airlines, in 2000 proved painful. The rival's books were worse than expected, integration snarled flights and baggage, and costly supplier contracts signed to fend off a hostile bid from Onex helped push Air Canada into bankruptcy protection in April 2003. It emerged 18 months later with Celine Dion fronting its relaunch and a pale new maple leaf nicknamed the toothpaste livery.
Source: Air Canada
