Aveos – the company that did the bulk of Air Canada’s heavy maintenance – announced Tuesday that a rescue package had little chance of success, so executives decided to liquidate the company.
The company filed for bankruptcy Sunday, throwing 2,600 people out of work.
Angry workers blocked access to the Aveos hangar in Montreal Tuesday morning, and were confronted by riot police to let traffic through.
Air Canada had offered a $15 million loan to help rescue Aveos, but the maintenance firm judged the offer too little, too late. It blamed $16 million in deferred and cancelled maintenance contracts for the closure, although Air Canada refutes the allegation.
Air Canada said it would implement contingency plans to have its airframe and engine maintenance performed at other companies, although several planes remain inoperable in Aveos hangars in Vancouver, Winnipeg and Montreal.
The airline had warned in court Monday that thousands of passengers a day could have their travel plans ruined unless work on the aircraft were completed.