10:37 AM EDT, 09/12/2024 (MT Newswires) -- Air Canada ( ACDVF ) is asking the federal government to intervene as early as Saturday to request arbitration ahead of a potential strike by pilots at the country's largest airline, Bloomberg is reporting Thursday.

Bloomberg noted the Montreal-based airline is set to start suspending flights Sunday as it prepares for a lockout as talks with more than 5,000 unionized pilots near an impasse. Fifteen months of negotiations between Air Canada ( ACDVF ) and the Air Line Pilots Association have stalled over wages.

"Our goal is to reach a deal, but if there is no conclusion by Saturday, we ask the government to be ready to intervene to avoid these disruptions for Canadians," Air Canada ( ACDVF ) spokesman Christophe Hennebelle said Thursday in a phone interview. Arbitration is "a path that seems reasonable."

Bloomberg noted the airline and the union are planning to meet Thursday, though Hennebelle said there's no certainty of reaching an agreement "because the union refuses to moderate its wage demands."

The pilots' union didn't immediately respond to requests for comment, but has said it's pushing to close a wage gap with its US industry peers. The office of Canadian Labor Minister Steven MacKinnon said in an emailed statement it's committed to the collective bargaining process.

Bloomberg noted Air Canada ( ACDVF ) offered to boosts the pay of pilots by about 30% within the next three years. The pilots haven't received a raise since last year. The union will be in a position to issue a 72-hour strike notice on Sunday. Air Canada ( ACDVF ) would be able to issue a lockout notice at the same time if there's no deal.

Because of Air Canada's ( ACDVF ) outsized role in the Canadian airline market, a prolonged pilot strike could negatively impact economic activity, Desjardins said Thursday.

Desjardins noted the last pilot strike was in 1998 and lasted for two weeks.

Desjardins said in using its near-term forecasting framework and internal passenger flight forecasts, it estimates that a two-week pilot strike could result in a loss to real GDP of around $1.4 billion (or 0.06% month over month) in September. It said this would mean daily losses of roughly $98 million. In addition, the number of passengers could decline by 2.1 million (-29% m/m). "A longer strike could have an even greater negative impact on the economy," Desjardins added.

But while economic activity in air transportation would decline in September, Desjardins expects that the air transportation industry would recover by around $1.5 billion in October in the event of a two-week pilot strike similar to that in 1998.

Charlene Hudy, Air Canada Pilots' Master Executive Council (MEC) Chair, was on CP24 TV in Canada earlier today to talk about the potential strike. She said the union involved is seeing "some progress" at the negotiating table.

AC was at last look up 1.7% at $15.67.

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