Caribbean Tourism Organization (CTO) State of the Industry Conference Vijay Bathija Senior Director Network Planning September 16-17, 2011

PRIVILEGED & CONFIDENTIAL 2

Welcome to Air Canada’s

World!

PRIVILEGED & CONFIDENTIAL 3

Air Canada is North America’s premier international airline

Air Canada has an extensive global network, with hubs in

three Canadian cities – Toronto, Montreal and Vancouver

Voted Skytrax 2011 Best International Airline in North America

AC serves 178 cities around the world

AC and its regional partners operate up to 1,500 flights daily

Air Canada is building an International Powerhouse

Well positioned for Trans-Atlantic growth through the A++ JV with

United and Lufthansa (now including LH affiliates)

Strong network to Asia with year-round daily service to Hong Kong,

Tokyo, Beijing and Shanghai from Toronto and Vancouver, Seoul

from Vancouver, and seasonal service between Calgary and Tokyo

PRIVILEGED & CONFIDENTIAL 4

Boeing 777 represents the flagship long-haul aircraft, while 767

is the backbone of the fleet:

12 777-300ER – 349 seats

6 777-200LR – 270 seats

8 330-300 – 265 seats

30 767-300ER – 191 to 260 seats

On order: 37 787-8/9

Variety of narrowbody aircraft allows AC to serve a variety of

markets effectively:

86 319/320/321 – 120 to 174 seats

60 E75/E90 – 73 to 93 seats

15 CRJ-705 – 75 seats

20 Q400 – 70-74 seats (by Aug 2012)

44 CRJ – 50 seats

60 DH8-100/300 – 37-50 seats

17 Beech 1900 – 18 seats

AC operates a varied fleet to serve a variety of markets

Operated by Air Canada Express carriers under various capacity purchase agreements

PRIVILEGED & CONFIDENTIAL 5

International fleet operates with Executive

First Suites with fully flat beds – best in

class product

North America mainline fleet features

touch-screen TV at every seat – unique

among legacy carriers

However, limited planned fleet growth until

787 arrival in 2014

Growth prior to 2014 requires increased

aircraft utilization or reduction of flying

elsewhere

AC offers a premium inflight experience that matches and

exceeds most legacy carriers

PRIVILEGED & CONFIDENTIAL 6

PRIVILEGED & CONFIDENTIAL 7

Air Canada – New Markets/New Horizons

PRIVILEGED & CONFIDENTIAL 8

Air Canada’s Growing International Route Network

NEW DESTINATIONS

SINCE 2009:

Geneva

Brussels

Copenhagen

Barcelona

Athens

PRIVILEGED & CONFIDENTIAL 9

Canada’s largest city and financial powerhouse with a

population of 5.5 million in the Greater Toronto Area

Ranked as the most multi-cultural city in the world by

UNESCO

World Class facility to support the goal of World Class Hub

Terminal 1 – all Star Alliance carriers under one roof

Superior experience vs US gateways and legacy carriers

Large local demand to all continents

Strong VFR traffic to Europe, Asia and Latin America

Excellent geographical position for connection traffic

between South America – Asia and North America –

Asia/Europe

AC is building an International Powerhouse at YYZ

PRIVILEGED & CONFIDENTIAL 10

Air Canada offers the most extensive network from

Canada to the Caribbean and Mexico

30 destinations

140 flights a week in Peak Winter

PRIVILEGED & CONFIDENTIAL 11

New Routes / Increased Frequency (W11/12)

Focus on Sun Markets for the Winter

PRIVILEGED & CONFIDENTIAL 12

Strong Sun Growth in Winter 2011/2012

Three new sun

markets with

weekly service

from YYZ hub

Continued

growth in

capacity to many

more markets

New Destinations:

YYZ-St. Thomas1x weekly 319 D6 24Dec-14Apr

YYZ-St. Kitts 1x weekly 319 D5 23Dec-13Apr

YYZ-Curacao 1x weekly 319 D6 24Dec14Apr

New Routes*:

YOW-Holguin 1x weekly E90 D4 24Dec-14Apr

YUL-Ixtapa 1x weekly 319 D5 23Dec-13Apr

YHZ- Turks (PLS) 1x weekly 319 D4 16Feb-03May

Capacity Increases:

YYZ- West Palm Beach #2 daily second flight

YYZ-Orlando Upguage to 321

YYZ-Liberia +1/7 on D1 to 3x weekly on D147

YUL-Punta Cana now daily from 5/7

YUL-Nassau +1/7 to 2x weekly on d67

YYZ-PLS +1/7 on D5 to 5x weekly on D13567

YYZ-San Juan + 1/7 on D6 to 3x weekly

YYC-Hawaii Increases

* Subject to government approval

PRIVILEGED & CONFIDENTIAL 13

The Planning Process

PRIVILEGED & CONFIDENTIAL 14

Cyclical

Economic

Environment

High

Fixed

Costs

Market

Dynamics Government

Regulations

Rising

Oil Prices

Global

Competition

Canadian GDP Growth vs. Air Travel Demand

5%

15%

-5%

-15%

1975 1980 1985 1990 1995 2000 2005

Real GDP

Traffic

Canadian GDP Growth vs. Air Travel Demand

5%

15%

-5%

-15%

1975 1980 1985 1990 1995 2000 2005

Real GDP

Traffic

The Airline Industry is a Dynamic Business

PRIVILEGED & CONFIDENTIAL 15

Volatility in the price of oil continues to be a major

concern to all airlines

PRIVILEGED & CONFIDENTIAL 16

Air Canada is Always Looking for New Opportunities

Air Canada is interested in the following:

International markets with year-round demand, with good corporate demand to both Canada and beyond

Markets with low market share penetration for AC and its Star Alliance partners are of particular interest

Transborder and domestic routes that help drive the international powerhouse strategy Summer seasonal, high-volume European leisure routes from Eastern Canada (high-density 767 aircraft) Leisure Winter Sun opportunities from all points in Canada (high-density A319 aircraft)

PRIVILEGED & CONFIDENTIAL 17

The Network Planning Process

1 Year and beyond

Strategic Long Term

Conduct market research, focus on broad regional growth opportunities and determine priorities for upcoming seasons

Includes longer term fleet planning

8 Months – 1 Year

Strategic Medium Term

Focus on specific markets, conduct financial evaluations, finalize deployments and route network for upcoming season

4 Months – 8 Months

Tactical Medium Term

Optimize capacity, adjust frequency and gauge according to demand, pursue opportunistic growth

2 Weeks – 4 Months

Tactical Short Term

Adjust fleet allocation and schedule based on current booking patterns and demand

Day of Departure

PRIVILEGED & CONFIDENTIAL 18

Partnering with Airports and Communities to Grow

Service

Airport Interest

Long term strategy of the airport for sustainable service

Establishing an economic driver in the community

Competition - What is my USP

What does Air Canada have to offer that will attract customers

Why attracts customer to your destination

Community Links

Local economy stimulated by new service

Offers new business opportunities (cargo, tourism, business)

North Bound Traffic

VFR – Visiting Friends and Relatives

PRIVILEGED & CONFIDENTIAL 19

New Market: Martinique

Airport Interest

Martinique Promotion Bureau highlighted the opportunity

Promotion Bureau and the airport met with us to present details of the opportunity

Competition - What is my USP

Air Canada is largest carrier in Canada and to sun spots

For Canadians: new Sun destination spot

French connection

Community Links

Hotels and tourism stimulated by added flight

North Bound Traffic

Potential VFR traffic and connecting traffic from Montreal

New FDF flights started in July 2009 and now operate year round. Win-Win for All

PRIVILEGED & CONFIDENTIAL

Privileged & Confidential 20

Vijay Bathija Senior Director, Network Planning vijay.bathija@aircanada.ca

Thank you for your support!