Westjet’s chief executive blames federal COVID testing roll-out for decision to cut operations affecting 1,000 employees
Decision comes as tourism data show spending on travel jumped between October and December, but remained well below pre-pandemic levels
Westjet said it would initiate cuts affecting another 1,000 employees next month, and it’s blaming the federal government.
“Immediately following the federal government’s inbound testing announcement on December 31, and with the continuation of the 14-day quarantine, we saw significant reductions in new bookings and unprecedented cancellations,” said Ed Sims, WestJet’s President and Chief Executive Officer. “The entire travel industry and its customers are again on the receiving end of incoherent and inconsistent government policy.”
The federal government gave airlines and passengers just seven days’ notice of new regulations that came into effect early Thursday morning. They require anyone wanting to fly to Canada to get a COVID test within 72 hours of their departure. With some exceptions, that test would have to show a negative result before the passenger would be allowed to fly. The government said the move is meant to prevent further spread of COVID.
“We have advocated over the past 10 months for a coordinated testing regime on Canadian soil,” said Sims. “But this hasty new measure is causing Canadian travellers unnecessary stress and confusion and may make travel unaffordable, unfeasible and inaccessible for Canadians for years to come.”
Airlines have pushed for testing as a way to reduce or eliminate quarantine periods for international travellers. Under current law, most people entering Canada must quarantine for two weeks. The testing requirement provided new measures to enforce quarantine measures.
As a result of the continuing doldrums, Westjet said it will remove 230 weekly departures from its February and March schedule. That’s 80% less than the previous year. The number of Westjet flights from key cities in February will look worse than it did in April, a month into the pandemic in Canada.
A thousand employees will either be laid off, have their hours cut, or take unpaid leaves. The airline is also freezing all hiring.
Westjet said it will suspend 11 routes in February and March. That includes all international service from Edmonton and such popular routes as Vancouver-Los Angeles and Calgary-Las Vegas. Another 13 seasonal routes to destinations in Mexico, the Caribbean, and London-Gatwick will also be suspended.
“Regrettably, this new policy leaves us with no other option but to again place a large number of our employees on leave, while impacting the pay of others,” said Sims. “This is a cruel outcome for loyal and hardworking staff who have been diligently working through the pandemic.”
“Sad to see more job and route cuts at WestJet, further reducing community connectivity,” said Daniel-Robert Gooch, the head of the Canadian Airports Council in a Tweet. “Without financial support for the air sector, how will we compete with foreign markets that have supported theirs when pent-up demand returns?”
Travel spending improves, but…
Westjet’s decision comes as Statistics Canada released new tourism data for the summer. In July, August, and September, people spend $3.1 billion on tourism transportation. Airfares account for much of that spending, but it also includes trains, charters, car rentals, and buses. That compares to more than $10 billion in the summer of 2019.
“Despite more than doubling (+131.7%), passenger air transport remained the hardest hit spending category, with levels 89.9% lower than in the fourth quarter of 2019,” the agency reported.
Spending by international tourists, where airlines can earn much of their revenue, was just $48 million over the summer. That’s down a whopping 97% from the previous year.
Canada’s borders remain largely closed to non-residents.
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