Air Canada files for bankruptcy protection

Air Canada tonight said it is filing for protection from creditors, seeking time to reorganise its business and negotiate concessions from unions and help from the government.

Shares in Canada’s dominant airline hit a new 52-week low on Monday, and trading was halted on the Toronto Stock Exchange today pending the announcement on seeking bankruptcy protection.

The move means Air Canada will continue flying during a reorganisation period, but shows its difficulty coping with the industry downturn after the September terrorist attacks, now exacerbated by the war in Iraq and the mystery illness spreading from Asia.