Air Canada was founded as Trans Canadian Airlines in 1938. For years it was the flagship carrier with an excellent reputation for service and safety.The airline initially did well after privatization but then things began to go downhill. In 2000, it bought out its major competitor Candian in a disastorous merger. Despite innovative iniatives Jazz, Tango, and Zip; and a virtual monopoly on long haul flights, AC is having its lunch eaten by low cost carriers and severe labor strife. The airline has recovered from bankruptcy in a situation largely caused by its own making. Air Canada is a Star Alliance member.