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Air Canada Orders 32 Boeing 777s, 787s (Apr. 25)

MONTREAL --- ACE Aviation Holdings Inc., the parent
company of Air Canada, and Boeing today announced a wide-body fleet renewal
plan for the airline that includes up to 36 Boeing 777s and up to 60 Boeing
787 Dreamliners.

Air Canada will use the airplanes to modernize its existing fleet and improve operating efficiencies, creating one of the world's youngest
and most simplified airline fleets.

The wide-body renewal plan includes firm orders for 18 Boeing 777s, plus purchase rights for 18 more, in a yet-to-be-determined mix of the 777 family's newest models: the 777-300ER, the 777-200LR Worldliner (the longest range
airplane in the world), and the newly announced 777 Freighter.

Air Canada's 777 deliveries are scheduled to begin next year with the arrival of three 777-
300ERs in 2006. The carrier's first 777-300ERs will operate its Vancouver-Tokyo service.

The renewal plan also includes firm orders for 14 ultra-efficient new Boeing 787 Dreamliners, plus options and purchase rights for an additional 46
airplanes. Air Canada's first 787 is scheduled for delivery in 2010.

"Our decision to modernize our fleet with the 777 and 787 Dreamliner will
move Air Canada into a clear leadership position among North American
international carriers with the world's two newest and most efficient twin-engine, long-haul airplanes," said Robert Milton, Chairman, President and CEO
of ACE Aviation Holdings. "No other carrier in North America is in a position to order the latest and most capable variants of the 777, the 200LR, and the
300ER and also the 787. The superior customer comfort and operating economics
of these aircraft will put us in the company of the leading European, Middle
East and Asia Pacific carriers.

"Our analysis of these aircraft pointed to overwhelmingly attractive economics. We have estimated the fuel burn and maintenance cost savings alone
on the 787 to be approximately 30 per cent versus the 767s they will replace.

"Particularly important in the current high fuel price environment is that the
savings on these two line items alone will be more than twice the incremental
ownership costs in acquiring these aircraft. Our only disappointment is that
Boeing will not be able to deliver us our first 787 aircraft until 2010.

"The agreement with Boeing is very attractive financially as the
operating cost of the 777 and 787 will be significantly less than our current airplanes they will replace, the acquisition costs will be spread over several
years, and the asset values of the aircraft we will replace and sell are significant. As we are planning to dispose of more than 60 wide-bodies over
the next decade, the net cash outlay for acquisition of these new aircraft is
expected to be greatly reduced. The average age of the Boeing 767s to be
replaced will be approximately 22 years."

The order is subject to several conditions including final documentation. The companies expect to finalize the agreement by mid-year.

Boeing Commercial Airplanes President and CEO, Alan Mulally, noted the
significance of the timing of the Air Canada order. "The timing of Air Canada's decision is critical for locking in rapidly disappearing early delivery positions for the 787, which is essentially sold out through 2010," said Mulally. "Air Canada also has secured three of the very few remaining
near-term delivery slots for the 777."

The 777 and 787 are uniquely suited to meet Air Canada's current route structure and growth plans, which include long-range, non-stop routes for both passengers and cargo, with an increasing emphasis on growing markets in Latin
America and China. Operating in the same fleet, the 777 and 787 will allow Air
Canada to tailor capacity to seasonal demand with two aircraft types that fly
the same speed and range yet offer different seating capacities.

"The new aircraft improves Air Canada's ability to manage its capacity more in line with the dynamic marketplace by giving it a constant stream of
efficient aircraft guaranteeing its ability to take advantage of growth opportunities, such as China, or through retirement of older aircraft, shrink
its capacity while improving the mix of extremely fuel efficient aircraft," said Montie Brewer, President and CEO of Air Canada.

"The success of the new Asia and Latin America routes introduced over the
past year point to further international expansion as key to increasing shareholder value," said Brewer. "This new equipment will permit us to lock in and expand our market penetration in an area which is already yielding very
positive economic returns. This, coupled with the flexibility negotiated both
in terms of delivery and financial options, should assure that we are at the
forefront of North American carriers in terms of the profitability of
international operations."

The delivery of three 777s in 2006 will allow Air Canada to implement its
recently announced expansion of services to China using existing wide-body
aircraft.

"We are proud to be a part of Air Canada's plans for future growth and
look forward to supporting the airline fully as it begins to incorporate our
777s and 787s into its fleet," said Boeing Commercial Airplanes President and
CEO, Alan Mulally.

-ends- Air Canada Selects Boeing 777s and 787 Dreamliners