MONTREAL – The Canadian government and Air Canada announced yesterday that they have reached a financial aid plan in the form of loans to help the country’s largest airline recover from the coronavirus pandemic.
The agreement calls for Air Canada to have access to about C$5.9 billion (RM19.4 billion).
“We have reached a significant and historic agreement with Air Canada,” Transport Minister Omar Alghabra told a press conference.
In order to benefit from the financial aid, Air Canada has agreed to abide by several conditions, particularly reimbursing customers whose tickets were cancelled by the carrier due to Covid-19.
The airline has also agreed to resume regional routes and impose restrictions on executive compensation.
Air Canada, which currently employs about 15,000 people, has pledged not to cut new jobs after having to lay off more than 20,000 employees since the start of the pandemic.
Deputy Prime Minister Chrystia Freeland hailed a “good and fair deal”, saying airlines are a strategic sector generating jobs for the country’s middle class.
Since the start of the pandemic, Canadian airlines have received more than C$2 billion in federal aid, allowing them to keep thousands of people employed, said Alghabra.
The government is continuing discussions with other airlines including WestJet, the country’s second-largest carrier, said Freeland.
The president of trade union Unifor, the largest private sector union in Canada, hailed the agreement.
“Today’s announcement by the federal government is a recognition that aviation workers are pivotal to the Canadian economy,” said Jerry Dias.
The nation’s air travel industry has been calling for a federal aid plan since last spring.
Unlike many other countries, Ottawa has until now refused aid targeted at the airline sector, insisting that companies first reimburse clients whose flights have been cancelled since the start of the Covid-19 crisis and resume abandoned domestic routes.
Air Canada has suffered a C$4.6 billion loss, marked by a 73% drop in passenger numbers due to the coronavirus.
In 2019, Air Canada posted a net profit of C$1.4 billion.
The carrier’s 2020 turnover fell by 70% from the C$19.1 billion recorded in 2019. – AFP, April 13, 2021
