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This case study discusses the consolidation and globalization of the Canadian airline industry. It focuses on the competitive struggling between Canada''s two domestic carriers, Air Canada and Canadian Airlines International, who by December of 1992 were incurring significant losses and fighting for their survival. Students are asked to assume the role of Air Canada and Canadian Airlines International and to develop strategies that will allow each airline to survive domestically and to eventually thrive in an increasingly global market. Students are also asked to assume the role of the Government of Canada and to devise government policies that will guarantee competitive air travel and a strong Canadian presence in the world airline industry. A thorough description of the structure and evolution of the world airline industry is provided so the students have a strong base of knowledge from which to make their decisions.