Air Canada

Flight cancellations add to pressure on government for airline aid

At government request, four airlines cancel all flights to Mexico and Caribbean until the end of April

Government commits to working with airlines on testing and quarantine strategies

pressure airline aid pressure
A Westjet Boeing 737-700 departs Vancouver International Airport January 21, 2021 (Brett Ballah)

New measures to restrict international travel have plunged aviation into its most severe crisis since March and increased pressure to aid the airline and airport sectors.

Ottawa introduced new testing and quarantine measures Friday. At the same time, airlines agreed to suspend flights to Mexico and the Caribbean until April 30.

“We need to ensure we take substantive action soon,” said Mike McNaney, President and Chief Executive Officer of the National Airlines Council of Canada. “Countries that have a true recovery strategy in place for their aviation sectors will be the best positioned to ensure the safe restart of their economy, to bring back jobs and investment and to successfully compete and take market share from countries that are not well prepared.”

Air Transat grounded its entire fleet as a result of the decision. Air Canada cancelled flights to 15 destinations. Westjet suspended 20 routes plus another four from its Swoop subsidiary. Sunwing also cancelled all flying to the affected destinations starting Sunday. Passengers whose flights are cancelled will get a full refund, the airline said.

On top of that, the airlines are scrambling to get as many people home as they can. It’s an operation reminiscent of repatriation flights in the early days of the pandemic.

Making travel more expensive

Ottawa is also making it more expensive for those who travel internationally. Arriving passengers will have to pay for a COVID test at the airport. Starting February 3, they can only land in Vancouver, Calgary, Toronto, and Montreal.

Ottawa issued a Request for Proposals this month for suppliers to conduct the tests. The document calls for 10,000 tests per day initially, and up to 100,000 tests per day as travel ramps up. The project sees a start in the four airports currently allowed to accept international travellers. But it also forecasts an eventual expansion to Edmonton, Winnipeg, Ottawa, Quebec City, and Halifax.

Arriving passengers will wait for their results at government-approved hotels. That will add about $2,000 to the cost of an international trip, said Prime Minister Justin Trudeau. He said the move will further protect Canadians from emerging COVID variants.

Health authorities have traved less than two per cent of COVID infections in Canada back to international travel.

“Yes it is extremely low the number of cases that are traced back to international travel, but it’s not zero,” said Trudeau.

A study by Western Aviation News this week showed most infections coming into Canada arrived on flights from the United States. The study was based on data from the Public Health Agency of Canada. The agency warns Canadians of possible COVID exposure on flights when at least one passenger tests positive.

That the U.S. was the biggest source was not a surprise. Most of Canada’s international traffic goes to or through hubs in the U.S. But the single biggest source of warnings was flights from Cancun. Mexico is a major destination for Canadians looking to escape the Canadian winter.

A bad situation worse

The cuts are another blow to airlines who are already bleeding cash as a result of the pandemic. On Wednesday, Westjet revealed it is refunding $450 million to passengers whose flights were cancelled. Although Air Canada revealed Friday the latest cancellations may not have much effect on the airline’s bottom line.

“System-wide the incremental impact on Air Canada’s cash burn is not material given the already reduced levels of passenger traffic resulting from COVID-19 and travel restrictions,” said Air Canada President and CEO Calin Rovinescu,.

Still, airlines have cut tens of thousands of employees from the payroll.

“Though these measures are necessary to help flatten the curve, they also highlight the continued withering away of airline jobs,” said Unifor National President Jerry Dias. “More than 300,000 workers are frustrated, wondering why their federal government refuses to present a plan to help them weather this pandemic. Unlike other countries, Canada’s continued refusal to help this industry is making a bad situation worse.”

“The pandemic has had devastating impacts on our hard-working people, and they have made tremendous sacrifices throughout,” said Westjet President and CEO Ed Sims. “The government recognizes how uniquely hard hit our industry has been and has acknowledged our efforts to curb the spread of the virus. We note their words of support for our airline as a strong partner in the fight against COVID-19.”

A risk to the very future of airlines

The government praised airlines for agreeing to cancel flights. But at the same time, the government did not announce an airline aid package.

“You can’t have one without the other,” said Dias. “Further travel restrictions without providing financial support for airline workers is a risk to the very future of Canada’s airline industry.”

“We had entered into a discussion with them last year,” Transport Minister Omar Alghabra told the CBC. “We now have an understanding these new extra measures will add extra pressure on their operations. And we are taking into account these extra measures into the negotiation. But there is no conclusion to the discussion.”

“There is a great deal at stake in the coming months and we look forward to engagement with the government on a clear and substantive sectoral recovery strategy,” said McNaney.

The government said it will work with airlines on a recovery strategy. That includes reexamining the link between testing and quarantines, a key airline demand.

“We know that it’s going to be extremely important to have a flourishing, thriving, competitive airline industry in Canada once this pandemic is done,” said Trudeau. “The conversations with these airlines continue, but I really do want to take a moment to salute and thank the leadership of Canada’s main airlines having taken this step.”

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