Air Canada CEO Calin Rovinescu acknowledged Thursday that winning support from the airline's employees is pivotal for his plans to launch a new subsidiary low-cost carrier.

Air Canada said last month it planned to launch the new carrier within a year, which would give it access to new leisure markets its current cost structure prevents it from turning a profit on, such as Amsterdam, Dublin, Casablanca and sun destinations during summer months. It aims to create a fleet of up to 50 767s and A319s drawing primarily from the main line's existing jets.

Rovinescu had said in an interview with the Financial Post last month that approval from the unions might not be necessary to go ahead, though that was his preferred route.

He admitted Thursday, on a conference call, that Air Canada may not be able to go ahead with the deal unless its pilots sign off on it, including the low-cost carrier's lower wage and benefits.

"You need to have the work rules that are not capable of bouncing back up to the main-line legacy structure," he said.

"Unless we have that, we won't proceed with it."

Rovinescu said the airline had learned from the mistake it made with its previous lower-cost carriers, Tango and Zip, that a competitive cost structure and large fleet would be needed in order for it to challenge rivals such as WestJet Airlines Ltd., Air Transat and Sunwing Vacations.

He reiterated that Air Canada's low-cost carrier would be akin to successful airline-within-an-airline models like Qantas Airways Ltd.'s subsidiary, Jetstar Airways.

But winning the support of its pilots has already proven a challenge. The Air Canada Pilots Association voted out its chairman this week over his decision to send a new tentative agreement out for ratification, in part, because it contained plans to create the low-cost carrier, but also other aspects, like moving new employees into a different pension scheme.

Adding to the labour concerns, the Canadian Auto Workers union, which represents 3,800 sales and service agents at the airline, will be in a position to take a strike vote on May 16, if a deal is not reached by then. There could be no strike until June 13 at the earliest.

Rovinescu said the lowcost carrier will be key to the airline's growth strategy until it gets its fleet of Boeing 787s starting in late 2013, because the airline does not intend to take on any new aircraft until then, unless a compelling business case can be made.

"You're going to have many, many years of virtually no growth," he said.

Management said they had considered other alternatives aside from the new carrier, but would not elaborate on the call Thursday.