Canada isn't ruling out taking a stake in Canadian airlines: Leblanc


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OTTAWA -- The Canadian government isn't ruling out the possibility of taking a stake in Canadian airlines, like WestJet and Air Canada, as ministers consider how to help the sector in its struggles amid the COVID-19 pandemic.

Intergovernmental Affairs Minister Dominic Leblanc confirmed the possibility during an interview with CTV Question Period Host Evan Solomon, airing Sunday

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https://beta.ctvnews.ca/national/politics/2020/10/18/1_5148841.amp.html

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I'm tired of this guy. He's past his best-before-date IMHO...

Thanks for the observation Bains. You and Garneau really have this all under control; I can sleep better tonight. Seriously, are there any prerequisites to being a Government Minister in our coun

In light of all the benefits the government is handing out...why don’t they just come up with a program to refund customers for travel not completed due to Covid?? It was the government policies that

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That’s very interesting. I believe that’s how Germany supported Lufthansa, by taking a 20% ownership stake. I don’t know how much it cost them. But, there is precedent for such an action, when our government took a stake in some big auto manufacturing in Canada.

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I'd still rather see the government trade loan guarantees for some of the airlines' accrued tax losses. Nor do I know if Onex is ready to give up total control, so it might campaign against a bailout structure of that kind. While most ire about bailing out carriers will end up pointed at AC, I suspect there will be opposition on the left (NDP for sure) about bailing out Onex on this. Certainly, if the govt wants to take a 20% share of the airlines it helps, it also suggests to me they first have to approve the Transat takeover. (I mean, if they became TS shareholders and then rejected the merger, they would probably have to put additional money into TS to keep it afloat.)

 

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Regional airlines reject prospect of government stake in carriers

Published Monday, October 19, 2020 1:28PM EDT
PLANE

An Air Canada flight departing for Toronto, bottom, taxis to a runway as a Westjet flight bound for Palm Springs takes off at Vancouver International Airport, in Richmond, B.C. (Photo: THE CANADIAN PRESS/Darryl Dyck)

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OTTAWA -- Regional airlines are demanding immediate action from Ottawa to prop up the beleaguered sector, but reject the idea of a federal stake in carriers.

John McKenna, president of the Air Transport Association of Canada, says the government has not responded to requests for cash over the past six months, leaving Canada as the only G7 country to hold off on pledging major financial aid for the industry.

Intergovernmental Affairs Minister Dominic LeBlanc left the door open to a bailout, including the purchase of airline shares by Ottawa, in an interview with CTV's Question Period on Sunday.

LeBlanc said Canadians expect stringent conditions on any federal airline funding that address the issue of travel vouchers, which carriers gave passengers instead of refunds for cancelled flights.

The United States and some European countries have demanded airlines provide reimbursement while offering them billions in financial aid, with strings attached that include 20 per cent government ownership in the case of Lufthansa and emissions reduction commitments from Air France-KLM.

Last week, Prime Minister Justin Trudeau pledged $41 million in emergency funding for northern airlines to ensure services for remote communities.

This report by The Canadian Press was first published Oct. 19, 2020.

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On 10/18/2020 at 11:11 AM, dagger said:

I'd still rather see the government trade loan guarantees for some of the airlines' accrued tax losses. Nor do I know if Onex is ready to give up total control, so it might campaign against a bailout structure of that kind. While most ire about bailing out carriers will end up pointed at AC, I suspect there will be opposition on the left (NDP for sure) about bailing out Onex on this. Certainly, if the govt wants to take a 20% share of the airlines it helps, it also suggests to me they first have to approve the Transat takeover. (I mean, if they became TS shareholders and then rejected the merger, they would probably have to put additional money into TS to keep it afloat.)

 

I doubt Onex would sell for what Ottawa is likely to be offering.

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Federal cabinet readies airline bailout package

Fri Oct 23, 2020 - The Globe and Mail
Robert Fife - Ottawa Bureau Chief
Andrew Willis
Eric Atkins - Transportation Reporter

OTTAWA - The federal cabinet is deliberating a targeted bailout package for Canada’s airline industry that includes offers of low interest loans and rollbacks of airport fee increases to help it cope with the fallout from the coronavirus pandemic.

The package of options that cabinet is reviewing recognizes that air travel is essential to the Canadian economy, and could come in the November economic statement or the next federal budget, expected in February or March, according to a senior government official and three industry sources. The Globe and Mail is not identifying the sources because the the government official is not authorized to discuss cabinet deliberations, and the others are not authorized to speak on behalf of their companies.

The federal government plans to make financial support conditional on two potentially controversial requirements: Public money cannot be used to pay air executives, and carriers may be asked to restart flights on routes that have been closed during the pandemic, according to the government source.

Air Canada cancelled 30 domestic routes in June, and WestJet Airlines Ltd. cut 80 per cent of its flights to the Atlantic provinces this month. Ottawa does not expect that the airlines would have to resume all routes to receive the bailout. According to the government source, financial support would require airlines only to resume key regional connections.

Large and small airlines have been lobbying for support from the federal government for months in the unprecedented crisis, as the pandemic kept passengers off planes and closed routes, bringing significant financial losses. In the past, Air Canada chief executive Calin Rovinescu has said government support should have minimal strings attached.

“If you look at the airline industry, it has taken a significant hit," Navdeep Bains, Minister of Innovation, Science and Industry, said when asked about the issue at an unrelated news conference on Thursday. "We recognize that as a government. We continue to work with the airline industry and all the relevant stakeholders to look at next steps of how we can support them, and support the workers and communities.”

Canada’s airlines had more than 50,000 employees when the pandemic began. In addition, tens of thousands of Canadians have jobs directly tied to the sector, including those who work at airports, in air transport and 4,600 employees at Nav Canada, the national air traffic controller.

To cope with reduced traffic, many airports and Nav Canada increased fees in recent months, hiking the cost of a cross-country flight for a family of four by about $100. Airlines want fees rolled back as part of a campaign to get the public to resume air travel.

While the government official cautioned that no decision has been made, cabinet is looking at offering loans at low interest rates through the Business Development Bank of Canada, Export Development Corporation or some other means of direct government backing.

It’s unlikely federal money would come from the Large Employer Emergency Financing Facility program set up by former finance minister Bill Morneau. The program offers loans at rising rates of 5 per cent to 8 per cent, but few companies have used it. The large airlines can sell bonds at 4 per cent. John McKenna, chief executive officer of the Air Transport Association of Canada, said the airlines need forgivable loans, or access to low-cost credit.

The federal cabinet is also considering a payroll support package that mirrors a U.S. initiative, the government source said. In March, the U.S. Treasury department rolled out a US$25-billion program for domestic airlines. By the end of September, seven of the largest U.S. carriers had received loans under the program, including American Airlines and United Airlines. To tap this funding, the U.S. airlines must fly to all destinations they served before the pandemic, unless they receive a government waiver.

The Liberals have not ruled out buying shares in smaller airlines that face a serious financial crunch, particularly those serving northern communities. However, the industry sources said the government is unlikely to invest in larger airlines such as Air Canada, WestJet and Porter Airlines.

The official stressed that the government will make it a condition of the bailout that no federal money go to executive compensation. In 2017, Ottawa issued a $372.5-million loan to Montreal-based Bombardier Inc., which makes business jets and rail products, and the company gave its executives US$32.6-million in bonuses.

In the absence of government support, Nav Canada announced in May that it would hike its fees by 29.5 percent, effective in September. In a press release at the time, the company said: “NAV Canada acknowledges this increase comes at a time when its customers are also in exceptionally difficult circumstances as a result of the COVID-19 pandemic.” Chief executive officer Neil Wilson said: “All available alternatives, including further government assistance, will continue to be explored and utilized in order to minimize or avoid the proposed rate increase.”

The Greater Toronto Airports Authority, owner of Toronto Pearson International Airport, increased its airport improvement fee by 20 per cent to $30 per departing passenger at the end of September – the first hike in 12 years. The Winnipeg Airports Authority raised its fee by more than 50 per cent, from $25 to $38, in September. Early this month, Halifax’s airport announced plans to increase its improvement fee by 25 per cent to $35 in January.

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3 hours ago, Airband said:

“If you look at the airline industry, it has taken a significant hit," Navdeep Bains, Minister of Innovation, Science and Industry, said when asked about the issue at an unrelated news conference on Thursday.

Thanks for the observation Bains. You and Garneau really have this all under control; I can sleep better tonight.

Seriously, are there any prerequisites to being a Government Minister in our country?

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Don Martin: Airlines can't defy the gravity of this pandemic without a government lift

Published Friday, October 23, 2020 1:39PM EDT
Airlines

Empty seats are seen during a flight from Vancouver to Calgary, Tuesday, June 9, 2020. Airlines in Canada and around the world are suffering financially due to the lack of travel and travel bans due to COVID-19. THE CANADIAN PRESS/Jonathan Hayward

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NANAIMO, B.C. -- Long before takeoff you see and feel the airline-jolting turbulence kicked up by COVID-19.

Flying into the second wave is an eerie and unsustainable combination of dreamy passenger conditions inside a daily nightmare for airlines now turning to the federal government for financial lift.

Take my flight to Nanaimo this week, a trip greeted with dismay and protests from family and friends.

It started at a usually jammed Ottawa terminal parking garage where I had the luxury of ignoring a spot two rows from the entrance to claim one just two spots from the door.

That was just the disorientating start to a strange new experience for someone who has been flying on mostly-packed planes for more than 50 years.

Next stop, an empty terminal. I mean that literally, not figuratively. In Canada’s sixth busiest airport, there were less than 40 people in the cavernous departure area at 7 a.m. on a normally busy weekday.

The flight departure board listed just 11 flights for the entire day. Not one flight was heading outside Canada. Every single one was on time because, having surplus planes stacked up around the gates, means there’s no need to wait for turnaround planes.

The big bonus for that: I had one person ahead of me in line for the temperature check and baggage scan.  

The only change at security, beyond the shuffling lineup of passengers, was the friendly and helpful staff. Gone were the sometimes curt and cranky commands to take off belts and haul out laptops. It took four minutes to clear.

The departure lounges are an even more ominous indicator for airports needing those formerly-lucrative retail dollars to keep the lights on.

The outer wings were deserted while the Starbucks, Tim Hortons and my favorite pub are closed. The Maple Leaf Lounge, not that this back-of-the-plane passenger qualifies for better-class entry, was dark.

The actual flying part of the process is a breeze. Boarding started on time, the doors closed early with 60 passengers on a plane configured for more than 150 (but the flight attendant told me her next flight was packed) and we were in the air three minutes before the scheduled departure time with the middle seat mercifully empty.

They hand out a goodie bag, more like a pandemic survival kit, which has water, a mask, sanitizer, earplugs and the always-awful pretzels.  

If it weren’t for the uncomfortable N-95 mask strapped on for six hours, this would’ve been my best-ever airborne experience.

And yet, it was the first time I’ve felt apprehension and sensed nervousness all around me.

Every cough attracted stares from nearby passengers. Sneezes had to be suppressed. Sniffles silently dealt dispatched.

And no wonder. While every cleaning and distancing precaution is being taken, there’s still a sobering list of 41 domestic flights in the last two weeks with alerts for passengers who sat near someone who tested positive.  

Unknown is how many of the surrounding passengers, if any, caught the virus while on board.

And so we’re confronted by a business model which cannot keep planes in the air while hundreds of thousands of pre-pandemic passengers keep themselves grounded.

My source in Transport Canada says speculation about incoming federal relief is mostly accurate with forgivable loans and potential breaks in landing fees.   

But the optics are tricky with higher priorities on the government’s radar than bailing out companies which stacked and packed passengers profitably for many years.

It needs to be sold as a hand-up, not a handout, particularly to keep routes into Atlantic Canada on standby until protectionist premiers pop that four-province bubble.

After flying across Canada, it’s clear the current pandemic flight path cannot be sustained until travel returns to normal sometime in 2021.

Airlines can’t defy the gravity of the situation with parked fleets, half-empty planes and deserted terminals.

That, unfortunately, is the plane truth.

 
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There is an important case for bailing out troubled industries in certain circumstances – when there is a temporary period of turmoil after which companies can be expected to return to normal. This helps to preserve consumer choice, competition, and jobs that would otherwise have been lost. For example, these bailouts were necessary, and successful, for the airline industry following 9/11, and the automobile industry following the 2008 financial crisis.

But it is not clear that this is the case with the airline industry in Canada. There is still no end in sight for the coronavirus pandemic, and even the vaccines under development may well take years to fully roll out. Canada expects to see ups and downs for many months, during which public worries about travel will remain, as will travel restrictions and quarantine rules. With such uncertainty, and especially given the many urgent demands on government funds, a bailout for airlines feels like a bottomless pit.

Government should only bail out airlines under strict conditions

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Canadians cool to idea of government subsidies for airlines: Nanos survey

Ryan Flanagan

Ryan FlanaganCTVNews.ca Writer

@flanaganryan Contact

Published Sunday, November 8, 2020 1:50PM EST
Pandemic Person

People line up and check in for an international flight at Pearson International airport during the COVID-19 pandemic in Toronto on Wednesday, Oct. 14, 2020. (THE CANADIAN PRESS / Nathan Denette)

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TORONTO -- Nearly half of Canadians are opposed to the idea of government subsidies for airlines in the wake of layoffs and route cancellations, according to a new survey from Nanos Research for CTV News.

Air travel is one of the industries most severely hurt by the COVID-19 pandemic, with passenger levels down by more than 90 per cent in Canada.

Major airlines have responded by laying off employees and pulling entire routes from their networks, including WestJet's announcement last month that it is eliminating most of its service to Atlantic Canada.

The industry has warned of far more cuts to come, and is pushing the federal government for financial assistance, including to keep planes flying to and from the North.

Intergovernmental Affairs Minister Dominic Leblanc told CTV's Question Period last month that the government is considering many options, including taking similar action to Germany, which bailed out Lufthansa in exchange for a 20 per cent stake in the company.

The Nanos survey found that Canadians are not enamoured with any form of government assistance, with respondents being three times as likely to say the government should do nothing as to say airlines should be subsidized.

In total, 47 per cent of respondents told Nanos that the government should do nothing in response to airlines cutting back on routes. Support for this option was highest in the Prairies, at 58.8 per cent, and lowest in Quebec, at 32.6 per cent.

Another 21 per cent of respondents said the government should subsidize other modes of transportation, such as buses or Via Rail, while 15 per cent said the government should subsidize the flights that have been cancelled. Seventeen per cent of respondents reported being unsure.

FLYING DURING COVID-19

Nanos also asked respondents how they would feel about travelling by air if new COVID-19 quick-screening procedures reduce the existing 14-day quarantine period.

Canadians were split on this question, with 26 per cent reporting that they would be more interested in flying if that were to happen, 38 per cent saying that they would be as interested, 29 per cent answering that they would be less interested, and seven per cent responding that they were unsure.

Response to this question varied significantly by age. Nearly 33 per cent of respondents between the ages of 18 and 34 said they would be more interested in flying in this scenario, with fewer than 18 per cent saying they would be less interested. Among respondents aged 55 and older, though, 21 per cent said they would be more interested and 37 per cent said they would be less interested.

BLAME FOR TESTING DELAYS

Another question in the survey asked respondents who they think is responsible "when the time between testing and receiving results is too long."

Testing delays have been a recurring theme during the pandemic in different parts of the country. Hours-long waits for tests and days-long waits for results were common in Ontario, Quebec and Manitoba as virus activity ramped up in September, although they seem to have abated somewhat since.

Just under half of all respondents – 49 per cent – said they thought the provincial and federal governments were jointly responsible for the delays. Another 40 per cent said it was solely the responsibility of the province, while five per cent said it was solely the responsibility of the federal government. Seven per cent reported being unsure.

Men were slightly more likely than women to blame both levels of government or the federal government alone, while respondents between the ages of 18 and 34 were more likely than other age groups to set the blame at the feet of the provinces.

Geographically, 47 per cent of respondents from Quebec said it was only the responsibility of the provincial government – more than respondents from any other region. The lowest score by that measure came from British Columbia, where 33 per cent of respondents blamed the province alone.

METHODOLOGY

These results are part of an omnibus survey that Nanos Research conducted between Oct. 28 and Nov. 1, via an RDD dual frame (landlines and cell phones) hybrid telephone and online random survey of 1,039 Canadians, 18 years of age or older.

Participants were randomly recruited by telephone using live agents and administered a survey online. The results were statistically checked and weighted by age and gender using the latest census information, and the sample is geographically stratified to be representative of Canada.

The margin of error for this survey is plus or minus 3.1 percentage points, 19 times out of 20.

The study was commissioned by CTV News and the research was conducted by Nanos Research.

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Ottawa says federal support for airline industry contingent on refunding customers

Lee Berthiaume Published Sunday, November 8, 2020 3:17PM ESTLast Updated Sunday, November 8, 2020 3:31PM EST
Marc Garneau

Transport Minister Marc Garneau stands during question period in the House of Commons on Parliament Hill in Ottawa, Monday, March 19, 2018. THE CANADIAN PRESS/Sean Kilpatrick

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OTTAWA -- New federal support for Canada's pandemic-battered airline industry will be contingent on carriers providing refunds to passengers whose flights were cancelled, the government announced on Sunday.

Transport Minister Marc Garneau laid out the requirement as he announced that Ottawa is ready to respond to the sector's desperate pleas for federal assistance by launching talks later this week.

Canada's commercial airlines have been hit hard by COVID-19, with passenger levels down as much as 90 per cent thanks to a combination of travel restrictions and fear of catching the illness.

That has prompted airlines to furlough hundreds of pilots and technicians and discontinue dozens of regional routes since March. They have also cancelled numerous pre-booked trips, offering passengers credits or vouchers instead of refunds.

Many Canadians have since expressed anger over not getting their money back. The Canadian Transportation Agency received 8,000 complaints between mid-March and the end of August, most of which are believed to be related to refunds.

Passengers have also filed a handful of proposed class-action lawsuits and three petitions garnering more than 100,000 signatures that call for customer reimbursement.

Garneau acknowledged the challenges facing the sector as he revealed the pending talks.

"The air sector cannot respond to these challenges on its own, given the unprecedented impacts on its operations," Garneau said in a statement.

"We are ready to establish a process with major airlines regarding financial assistance which could include loans and potentially other support to secure important results for Canadians," he added. "We anticipate beginning discussions with them this week."

Yet Garneau also made clear what the government would be demanding from airlines, starting with refunds of what is believed to be millions of dollars in pre-paid flight tickets and a curb on cancelled routes.

"Before we spend one penny of taxpayer money on airlines, we will ensure Canadians get their refunds," he said. "We will ensure Canadians and regional communities retain air connections to the rest of Canada."

It was not immediately clear whether that would include pushing Air Canada and others to resume dozens of routes that are currently suspended.

The tough words around refunds were cautiously welcomed Sunday as a good first step by Canadian Automobile Association vice-president Ian Jack, whose organization is one of the largest retailers of vacations and leisure travel in Canada.

"It's the starter pistol, but it's by no means a fait accompli," Jack said. "We'll be watching these negotiations closely. There is now a concrete, on-the-record commitment from the government that we expect them to honour."

In contrast to Canadian authorities, the European Commission and the U.S. Department of Transportation have required airlines to refund passengers for cancelled flights.

The U.S. and European countries including France and Germany have also offered billions in financial relief to struggling carriers. Ottawa has provided no industry-specific bailout to airlines.

The pandemic has devastated the airline industry, with billions of dollars in losses for Canadian carriers amid grounded flights and tight international borders.

Canadian airline revenues in 2020 will fall by $14.6 billion or 43 per cent from last year, according to estimates in May from the International Air Transport Association.

This report by The Canadian Press was first pu

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WestJet Group of Companies reacts to this afternoon's statement from Transport Minister Marc Garneau


NEWS PROVIDED BY

WESTJET, an Alberta Partnership 

Nov 08, 2020, 15:12 ET

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CALGARY, AB, Nov. 8, 2020 /CNW/ -

"We will evaluate this afternoon's statement from the Government of Canada and will await greater clarity on what support for the aviation sector might include.

As we determine how to proceed in the best interests of our guests, our people and the communities we serve, we won't be making any further comment."

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In light of all the benefits the government is handing out...why don’t they just come up with a program to refund customers for travel not completed due to Covid?? It was the government policies that contributed to a travel ban.....if the economy is to “come roaring back”, there needs to be a transportation network in place.......btw .. how many tickets were purchased as non refundable , as per the tariffs?

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14 minutes ago, J.O. said:

That makes up the majority of the refund claims that have been made.

and your source is?  Surely there is a difference between, I cancel and you (airline) cancel the operation?   If not then there should be.

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Aviation Workers to Hold a Rally at Transport Canada Office on November 13th, 2020 at 12:30


NEWS PROVIDED BY

Aviation workers 

Nov 12, 2020, 15:03 ET

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VANCOUVER, BC, Nov. 12, 2020 /CNW/ - Aviation workers will be peacefully marching starting at noon from the Terry Fox statue in BC place towards the Transport Canada building in Vancouver on November 13th, 2020 to demand from the Government of Canada concrete measures for a safe reopening of the aviation industry. As aviation industry workers made redundant in Canada, we are looking for the use of rapid testing at airports across Canada to avoid blanket quarantines, and a comprehensive financial aid plan for airlines with strict labor protection for furloughed employees to safely restart the aviation industry and contribute to the recovery of the Canadian economy.

Our Facebook group was started in early September by airline pilots, who felt that aviation industry workers were forgotten during the COVID-19 pandemic. The issue has struck a responsive chord, with 9,000 members joining within 5 days.

Over 12,000 members strong today, our group represents all aviation industry employees whose lives and livelihoods were destroyed by the demise of the Canadian air travel industry. We are pilots and flight attendants; flight dispatchers; crew schedulers; ground personnel; airport personnel; catering; cleaners; ticket agents; travel agents; tour operators; and people of many other professions within the commercial aviation industry.

Among the strictest in the world, air travel restrictions imposed by the Canadian government since March 2020 to stem the spread of COVID-19, also brought the commercial aviation industry to nearly a complete halt. For nearly 9 months, there was no clear message from our government on specific measures in place to gradually restart the industry.

Aviation is a key driver of the Canadian economy. A major employer, air transport industry provides livelihood to over 633,000 Canadians via direct and indirect wages and induced spending. It is also the only rapid worldwide transportation network, essential for global business. It plays a vital role in generating economic growth and facilitating international trade. Grounded airplanes disrupt not only business and tourism travel, but make it impossible to deliver emergency medical supplies, foreign temporary workers to help Canadian farmers, or fresh fruits and vegetables to your table.

We demand concrete measures from the federal government to safely restart the aviation industry for the benefit of all Canadians.

For more information on our group, Aviation workers made redundant in Canada by the COVID-19 crisis, go to https://www.facebook.com/groups/3564215546923455

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Why the CEO of a small N.L. airline wants the federal government to bail out the big guys

From CBC News – link to original story

‘We’re a regional airline,’ says Patrick White. ‘We need the national airline to connect to’

CBC Radio · Posted: Nov 11, 2020

patrick-white.jpg Patrick White is the CEO of EVAS Air. He recently wrote a letter to the prime minister advocating a federal bailout of $5- to $7-billion for Canada’s national airlines. (Submitted by EVAS Air)

Patrick White says he understands why many Canadians aren’t particularly fond of big airlines like Air Canada and WestJet — but he worries that if they can’t make ends meet, the whole system will fall apart.

White is the CEO of EVAS, a small aviation company that operates out of Gander, N.L. He recently wrote a letter to the prime minister advocating a federal bailout of $5- to $7-billion for Canada’s national airlines.

The government, meanwhile, has said such a bailout is only on the table if the airlines refund passengers whose flights were cancelled during the pandemic.

WestJet vowed to refund customers in October. Air Canada, which faces a proposed class action lawsuit over non-refunded tickets, has said it will return “refundable fares.” Both airlines declined interview requests from As It Happens. Air Canada said in a written statement that it looks forward to sitting down with the federal government to discuss a possible aid package. 

Here is part of White’s conversation with As It Happens host Carol Off. 

Patrick, why do you think Canada’s big airlines should get a bailout from Ottawa?

First of all, I would kind of change the word of a bailout, because it’s such a negative connotation of some company that failed to do what it should have done to be successful and someone had to bail them out.

But, you know, I know your question is designed around, you know, should the federal government invest into the national airline system to protect the networks for Canadians going forward? And the answer is absolutely they should.

Bailout is the word you use when there are businesses that are in trouble and they need a financial assistance. They can’t do it on their own. So you don’t feel that there’s no way they can survive, if they don’t get this support from Ottawa?

The airlines perhaps can survive in some some faction, some small piece of its former self. But the thing is … if [the national airline system] continues to [shrink], and unless we deal with this, it will only be a shadow of its former self.

So while we may have a couple of national airlines, [they will be] so small that they will fail to meet the needs of our nation when it comes to connectivity and rural connectivity across the trunk of the airports from Vancouver to St. John’s.

evas-exploits-valley-air-services-sign-a EVAS Air operates out of the Gander International Airport. (Chris Ensing/CBC)

So you think that if they don’t get the support, then the airline industry, the national airlines, will not survive? … At the end of this pandemic, we won’t see the big carriers like like Air Canada and WestJet?

That can happen. And if you just do the mathematics there and see how much companies are losing per day and kind of project out how long that can go on … where the end of it comes, or where the dog brings up on the chain, is hard exactly to say. But at the end of the day, you can be assured that the national airlines cannot sustain these losses for indefinitely.

Did you say “where the dog brings up on the chain”?

I’m sorry, Carol. Look, when I grew up, we used to haul wood with the dog. So that’s coming from a real old fella. So sometimes the dog, [as] we were getting close, he’d be running, so excited to see us, that he’d bring up on his chain. So poor analogy, Carol.

But of course, you know the issue is … a lot of Canadians think, well, why should tax dollars be going to the big carriers when they haven’t bothered to refund the money that they kept when they cancelled flights during the pandemic?

Yep, absolutely. And on a personal level, I can understand people saying that and thinking that.

Airlines fail to be the most beloved of companies. I mean, we interact with them. And, of course, there’s all kinds of issues that people have, from delays and lost bags, and they have a long memory of that. So to some degree, our biases here are to say, “Oh, you know, the darn airlines.”

But at the end of the day … if we’re going to maintain the national airline standard that we’ve become accustomed to, then somehow or another … we’re going to have to bail out the network.

This is what the G7 countries have done all around the world.

But the other countries [where] they’ve done a bailout … in Europe and in the United States, they are required to give those refunds to people. And now it appears that’s what the Canadian government is saying, what Ottawa is saying: We’re not going to give a bailout to the airlines unless they give up those refunds. Do you think that that’s fair?

It’s certainly fair for the government to make that requirement.

I want to ask about your own carrier, EVAS Air out of Gander. How has the business been since COVID hit?

We’ve been extremely busy in the cargo piece of our business, Carol, and as well, of course, we operate air ambulance aircraft. And because of the reduced amount of flying in the network flying, then the charter business has picked up. But we’re also modifiers of aircraft and we do all kinds really cool stuff to modify aircraft for alternate uses. So we’ve really dug our heels into that and accelerated some of our programs there.

So we’re in a pretty good holding pattern, waiting to see what, in fact, is going to happen.

And I have a extreme interest in the national side, because we’re a regional airline. We need the national airline to connect to. So if the national airline goes away, then it’ll be a like a puzzle, a jigsaw puzzle of hodgepodge regional airlines, trying to connect. So we must have a national airline system.

evas-air.jpg White says regional airlines like EVAS Air need national airlines to connect to. If the national airline goes away, he says the system turns into a “jigsaw puzzle of hodgepodge regional airlines” trying to connect to each other. (Garrett Barry/CBC)

Ottawa seems to be saying that it wants to see the airlines restore a lot of the flights to different parts of Canada. They want to, again, get every part of the country being served. Do you think that that’s possible before we see the end of this pandemic?

I understand that. Canadians feel the same way. I feel the same way.

But at the end of the day, if we want this network to be maintained at a time in very reduced passenger travel, then there is a cost associated with that. And I maintain, Carol, to you and everybody else, that with the money that the national airline system is bleeding now, it is almost impossible. They have to do what they’re doing.

If somebody is listening here for the federal government, for the love of God, could you please make sure that you sit down by yourself in a room with these airlines and don’t come out until you have a deal? 

If it’s really important that people get their refunds and that, well, address that in the deal. If it’s really important to have rural connectivity, then address that in the deal. But for the love of God, go sit down with our national airlines and work this thing out and really get it done. It’s time to get this done, Carol.

And what do you worry would happen, if Ottawa doesn’t get it done?

Oh my, Carol, don’t be talkin’. Listen girl, I’ve had the knots in my gut and I’ve watched this airplane business for a long time. I’ve been in this since I had acne and I was a youngster.

If you understand this aviation industry and the huge critical mass of aviation capacity that sits there in the United States, it would be like opening up a small crack in the dam…. You open up a crack in that dam, and that capacity of the U.S. would flow into Canada, and that will be the end of any … Canadian-owned national airline system.

Well, we’ll see if Ottawa is listening to you, Patrick.

Well, now girl, my experience is that I’m not sure. I’ve failed horribly most of my life to get politicians to listen to me, even though I approach it with with mostly warmth and kindness that our Newfoundland people are known for. 

But I really wish, Carol, that they would get serious, sit down and deal with this thing. And enough of the lollygagging and back and forth, for the love of God. 

All right. We’ll leave it there. And may your dog never bring up on its chain.

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Travel agents want protection in airline bailout

From Global News – link to original story

By Frazer Snowdon  Global News ~ November 12, 2020

The pandemic has decimated the travel industry, grinding it to a halt since March of this year. But the idea of an upcoming bailout for airlines has travel agents across the country nervous about how it could affect them.

“If they do that and do a recall of commission to the travel agent, then that’s going to be detrimental to the travel industry,” says Flemming Friisdahl, president and founder of The Travel Agent Next Door.

Friisdahl, who represents hundreds of independent employees across the country, says as companies issue refunds, a trickle-down effect will see travel agents pay for it unless protection is put in place. Friisdahl, who has been in the business for more than 20 years, says his agents have had thousands of dollars called back by companies.

“I’ve had $300,000 already that I’ve had to pay back. … I would have to go to someone who got paid commission back in February, and ask them for it back.”

“The problem is they’ve already spent it on rent, groceries,” Friisdahl says. “You would never expect they want it back.”

It’s the same for the whole industry.

“As a single mom, this was my business. This was it,” says Tracy Turberfield, who relies solely on 100 per cent commission, with no base salary. “My business disintegrated before my eyes.”

The luxury travel associate says getting refunds is bittersweet. “I was thrilled for the clients. I want my clients to get their money back,” she says.

But that also means agents have to give up the commission they earned — and sometimes working around the clock to get customers their refunds over the past few months.

“The travel agents are having their pay taken back for work they’ve already done,” Turberfield says.

“Yes, the clients didn’t travel, but that doesn’t mean we didn’t work,” she said. “When the cancellations started to pour in, we spent many hours advocating for our clients and processing paperwork for our clients.”

Ottawa says any bailout for airlines will be contingent on the companies issuing refunds for those cancelled trips. In Parliament on Sunday, Transport Minister Marc Garneau said the government is working on a solution, but needs airlines to take action.

“Before we spend one penny of taxpayer money on airlines, we will ensure Canadians get their refunds,” he said. “We will ensure Canadians and regional communities retain air connections to the rest of Canada.”

“We are ready to establish a process with major airlines regarding financial assistance, which could include loans and potentially other support to secure important results for Canadians,” he added.

But the problem is how the contracts are written for travel agents now. Agencies and representatives will be affected if that happens.

“Right now, the way the policies are is that once there is a refund, they claw back our commission,” says Judith Coates of the Association of Canadian Independent Travel Advisors. She, like all agents, wants refunds for clients but says their fear is that a bailout without stipulations in place would cripple them.

“We want them to be able to include some kind of stipulation that travel agents get their commissions protected,” she says.

Coates helped found the association after independent travel advisors realized they weren’t represented during a trying time for the industry. She says more than 150 agencies have already shut their doors.

Companies like WestJet say they are sympathetic to the situation.

“We urge the federal government to take action to address these issues and are advocating not only for our airline, but the entire travel supply chain,” WestJet says in a statement. “This is to ensure our critical industry can help lead Canada’s economic recovery.

Professionals like Turberfield say that if something isn’t done to protect everyone involved, it could affect the whole industry.

“We’re an ecosystem,” Turberfield says. “Everybody in that ecosystem — the airlines, the tour operators, the destinations and the travel specialists — we all need to be supported.”

“I want to still be here when this is all over. I want to be able to send my clients to the Caribbean and continue working in the industry,” she says.

© 2020 Global News, a division of Corus Entertainment Inc.

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https://www.theglobeandmail.com/business/article-airlines-express-frustration-over-lack-of-progress-in-aviation-bailout/

Airlines express frustration over lack of progress in aviation bailout talks
By ATKINS, FIFE, WILLIS
13 Nov 2020

The federal government has begun talks aimed at bailing out the aviation sector, but players in the industry are frustrated by the slow start to negotiations amid the collapse in air travel.

Ottawa has drawn up a list of five key demands in what is expected to be tough negotiations on a COVID-19 rescue package for struggling Canadian airlines, including a call for the carriers to open their books, refrain from cancelling orders for Canadian-made planes, protect vital flight routes and provide refunds to customers for cancelled flights, an amount worth billions of dollars. Cabinet gave authority to Transportation Minister Marc Garneau to reach deals that protect the interests of Canadian travellers and the financial viability of the airline industry, according to a source who has been briefed on the federal strategy. The source is not being identified because they are not allowed to discuss cabinet deliberations.

The aviation industry’s demands vary by company, and include: financial help from taxpayers, preferably in the form of grants or interest-free loans; the national roll-out of a COVID-19 testing regime to allow shorter travel quarantines; a framework to reopen domestic travel, including a plan to identify safe corridors and create domestic bubbles like the one in Atlantic Canada; breaks on fees paid to airports and NavCanada; relief from the costs of the carbon tax on fuel; incentives to buy fuel-efficient aircraft; relief from the demand that all airfares be refunded.

Formal negotiations begin next week but some preliminary talks happened in recent days with executives from various airlines, including Porter Airlines chairman Robert Deluce, whose airline remains grounded.

However, talks with WestJet Airlines Ltd., Air Canada and other industry players have yet to happen, according to an industry source who is not being identified because they are not authorized to speak publicly on the matter.

James Bogusz, chief executive of Regina Airport Authority, said he is “hopeful” talks on federal aid will begin soon, but “there hasn’t been … any new dialogue with the federal government.”

“I’ve heard nothing. It’s frustrating,” said John McKenna, head of the Air Transport Association of Canada, which represents 75 air operators and dozens of industry stakeholders, including Sunwing Airlines and Flair Airlines.

“Nothing has happened on our side,” said Christophe Hennebelle, a spokesman for Montreal-based leisure carrier Transat. “We are very eager to begin discussions, of course, but there has been no reach-out on the file.”

Mr. Hennebelle said it came as no surprise the government wants to link aid with refunds. Transat is holding $564-million as of July 31 in customers' fares for cancelled flights. The airline would be “delighted to be in a position to refund our customers. If the government wants to help us doing so, we are certainly game,” Mr. Hennebelle said on Friday.

Air Canada Air Canada has $2.3-billion in prepaid fares, including cancelled flights, according to company documents.

A spokeswoman for Mr. Garneau did not address questions on the timing and subject of the negotiations. “Our government is developing a package of assistance to the air sector,” said Livia Belcea, Mr. Garneau’s press secretary. “Further details regarding any financial assistance would be announced in due course.”

WestJet and Air Canada declined to comment.

As a large country, Canada needs to ensure it has a healthy airline industry to support its economy in addition to the sectors it supports, such as hotels, taxis, airports and travel agencies, said Barry Prentice, a transportation professor at University of Manitoba. Widespread use of a COVID-19 vaccine is needed before demand for travel will return to prepandemic levels, he said.

Mr. Garneau signalled talks were to start in a statement he issued on Nov. 8.

The statement, which came as a surprise to the airline industry and its customers, said any airline aid would come with a significant requirement – that the carriers give back customers' money for flights cancelled amid the pandemic. This marked a reversal for a government that previously said it backed the Canadian Transportation Agency’s statement that vouchers or credits – not refunds – for flights cancelled by airlines were an “appropriate” remedy amid devastating business conditions.

“We will ensure Canadians and regional communities retain air connections to the rest of Canada,” Mr. Garneau said in the release, which was a response to calls Air Canada began making to provincial and federal government officials in the previous days.

Air Canada had advised governments of its intention to cancel 95 routes, domestic, U.S. and international, and pull out of another nine airports, moves that risked isolating parts of the country, in an effort to reduce its cash burn of about $13-million a day. The cuts were to be announced on Monday morning, when it reported a third-quarter loss of $685-million, the sources said.

In the end, Air Canada backed away from making the cuts, and acknowledged Mr. Garneau’s intention to proceed with sector-specific aid talks. But the airline issued a warning of its own, and signalled the high stakes involved in the negotiations: “We are deferring the additional route suspensions and station closures pending the progress of those discussions."

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