Government financial support for the air sector
LOCATION: OTTAWA, ON
Issue/Source: Government financial support for the air sector
Date: March 17, 2021
Suggested Responses
- The Government of Canada understands the significant impact the COVID-19 pandemic is having throughout the air sector.
- Building on earlier support, such as funding for remote air services and airport rent waivers, as part of the 2020 Fall Economic Statement, the Government announced $1.1B in financial support for the air sector, to support regional connectivity, critical infrastructure investments and the continued operation of Canada’s airports.
- The Government is also engaging with Canada’s major air carriers regarding potential options for financial assistance. As part of this process, the government will ensure that Canadians’ interested are protected, including refunds for flights cancelled due to COVID-19.
BACKGROUND INFORMATION
- The air sector has been severely impacted by COVID-19, as passenger volumes continue to be down by almost 90% compared to the same period in 2019. It is not anticipated that traffic will begin to approach 2019 levels until 2024.
- The continuing drastic drop in passenger volumes, and limited outlook for recovery is further threatening air transport sector finances, with the result that providers are having to increase fees, undertake further layoffs, and make more cuts to routes and other services. As a result, air carriers, airport authorities and NAV Canada have requested additional support from the Government, over and above the economic measures announced to date.
- On November 8, 2020, the Government announced that it would be engaging with air carriers to develop a package of support to help them address the challenges of the pandemic. Any support would require that carriers refund passengers for travel cancelled due to the pandemic, and also focus on ensuring regional connectivity and Canada’s aerospace sector. Federal officials are now engaging with the carriers regarding this initiative.