Air Canada Bailout

Nick Danger

Council Member
Jul 21, 2013
1,216
150
63
Penticton, BC
There's a lot of stuff on the table for this topic. Air Canada received the largest amount of government pandemic aid of all publicly traded companies in Canada, but continues to cut flights and lay off employees, and showing no progress on dealing with refunds for flights cancelled due to the pandemic. They are also actively seeking more government aid by way of an industry-specific bail out.

Air Canada and taxpayer money.

Transport Minister Marc Garneau has said there will be no money for airlines until the refund issue is dealt with:

No Federal money for airlines

Air Canada now says there will be no refunds without a federal bailout.

Air Canada no refunds

To add interest to the whole pile, Air Canada is seeking government approval to take over Air Transaat, with an offer already approved by Air Transaat shareholders.
 

Nick Danger

Council Member
Jul 21, 2013
1,216
150
63
Penticton, BC
They've been in slash and burn mode for a few months now. They used to fly into Penticton four or five times a day, now it's zip. Some other outfit with smaller equipment picked up the Vancouver runs and WestJet is still doing the Calgary service, just not as often right now. I used top split between the two for my commute to Alberta but gave up on Air Canada last year. They can be right ignorant when something goes wrong, and if it's their fault or not they always manage to squeeze more money out of you. In the long run it's cheaper for me to fly a day ahead and hotel it in Calgary than deal with those crooks.
 
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petros

The Central Scrutinizer
Nov 21, 2008
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Moccasin Flats
Soooooo. Which airline scored the Amazon Prime runs and left Air Canada high and dry?

Flair? They just bought new planes.

Edmonton-based Flair Airlines adds 13 Boeing 737 Max planes to fleet​

By Jon Victor The Canadian Press
Posted January 27, 2021 11:47 am EST
The tail section of a Flair Airlines plane is seen in this undated handout photo.

The tail section of a Flair Airlines plane is seen in this undated handout photo. THE CANADIAN PRESS/HO, Flair Airlines

Discount carrier Flair Airlines said Wednesday that it will add 13 new Boeing 737 Max aircraft to its fleet, as the plane returns to service worldwide following a nearly two-year grounding.

Flair’s new planes will be delivered in early 2021, giving the airline additional capacity at a time when other Canadian carriers are cutting routes and laying off staff in response to a challenging business environment.

“These planes will enable us to keep fares low while expanding our service to meet travel demand,” Stephen Jones, Flair’s president and CEO, said in a statement.
 

Danbones

Hall of Fame Member
Sep 23, 2015
23,866
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? ! thought bailing out planes was something you might only see in Nfld...and even then, only after a good rain storm.
 

Goober

Hall of Fame Member
Jan 23, 2009
24,690
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Moving
There's a lot of stuff on the table for this topic. Air Canada received the largest amount of government pandemic aid of all publicly traded companies in Canada, but continues to cut flights and lay off employees, and showing no progress on dealing with refunds for flights cancelled due to the pandemic. They are also actively seeking more government aid by way of an industry-specific bail out.

Air Canada and taxpayer money.

Transport Minister Marc Garneau has said there will be no money for airlines until the refund issue is dealt with:

No Federal money for airlines

Air Canada now says there will be no refunds without a federal bailout.

Air Canada no refunds

To add interest to the whole pile, Air Canada is seeking government approval to take over Air Transaat, with an offer already approved by Air Transaat shareholders.
From what I recall the original higher offer was refused. They made a new and lower offer, accepted
The issue that needed to be addressed some time ago would be consumer rights and protections, much stronger than what we presently have.
At a Federal level.
 
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spaminator

Hall of Fame Member
Oct 26, 2009
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Air Canada pledging passenger refunds as aid negotiations drag on: Union president
Author of the article:Canadian Press
Canadian Press
Publishing date:Mar 04, 2021 • 22 hours ago • 2 minute read • comment bubble9 Comments
Air Canada logo.
Air Canada logo. PHOTO BY MARK BLINCH /THE CANADIAN PRESS
Article content
OTTAWA — Unifor president Jerry Dias says Air Canada continues to promise refunds for passengers whose flights were cancelled during the COVID-19 pandemic.

The airline has made the pledge repeatedly during negotiations with the federal government over an aid package for the battered sector, said Dias, who noted talks are ongoing.


“I spoke to the CEO of Air Canada last night. So I know that this commitment has been made for quite a while.”

Air Canada took issue with Dias’s take, saying no such conversation took place within the past week or beyond.

The airline said that discussions are ongoing, but no deal has been reached.

The Finance Department did not respond immediately to questions about the refund commitment.

Then-chief executive Calin Rovinescu said in November the airline would not hesitate to reimburse customers stuck with unused tickets if the conditions of a federal bailout were reasonable.

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After a halting start nearly four months ago, talks ramped up over the past month, reaching a pace that he called a negotiation. Any deal would include a resolution on passenger refunds, a plan for returning service to regional markets and financial support for the aerospace sector, Rovinescu said last month.

Air Canada says there are no updates since then, with no agreement yet in place.

Dias said only about 4,000 of the union’s 15,000 aviation workers remain fully employed a year into the COVID-19 pandemic, lending urgency to discussions in Ottawa.

“We can’t get more urgent than now,” he said.

“Frankly, getting a little frustrated hearing that it’s imminent, just around the corner. Like, it’s been a year — I’ve grown two beards since hearing this.”

Ottawa has put reimbursement of travellers on the table as a key demand in exchange for financial relief for airlines, on top of asking carriers to maintain regional routes.

Air Canada posted a staggering $1.16 billion loss in the fourth quarter of 2020, a result that caps what Rovinescu called the bleakest year in aviation history.

“While there is no assurance at this stage that we will arrive at a definitive agreement on sector support, I am more optimistic on this front for the first time,” Rovinescu said on a conference call with analysts Feb. 12, three days before he passed Air Canada’s controls to new CEO Michael Rousseau.

Unifor and two pilot unions are calling for federal loans totalling $7 billion at one per cent interest over 10 years. Unifor is also asking Ottawa to waive a fuel tax for Canadian carriers and suspend additional landing and gate fees on passenger and cargo flights.

Air Canada, Rouge, WestJet, Swoop and Sunwing agreed in January to suspend service to Mexico and the Caribbean at the request of Prime Minister Justin Trudeau to help fight viral spread.

The moves resulted in the temporary layoffs of thousands of airline workers.

Last month Air Canada announced it will temporarily lay off 1,500 unionized employees and an unspecified number of management staff as it cut 17 more routes to the U.S. and international destinations.
 

spaminator

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Oct 26, 2009
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Air Canada and Transat terminate planned deal after EU advises against it
Author of the article:Reuters
Reuters
Publishing date:Apr 02, 2021 • 21 minutes ago • 3 minute read • Join the conversation
Air Transat and an Air Canada aircrafts are seen on the tarmac at Montreal-Trudeau International Airport in Montreal, on Wednesday, April 8, 2020.
Air Transat and an Air Canada aircrafts are seen on the tarmac at Montreal-Trudeau International Airport in Montreal, on Wednesday, April 8, 2020. PHOTO BY PAUL CHIASSON /THE CANADIAN PRESS
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Air Canada scrapped its proposed acquisition of Transat AT Inc on Friday after being advised by the European Commission that it would still face high regulatory hurdles, clearing the way for other domestic suitors for the tour operator.

Canada’s largest airline said that after recent discussions with the European Commission (EC), it had become evident the EC will not approve the acquisition based on the offered remedy package the carrier made earlier this year.


Quebec businessman Pierre Karl Peladeau said on Friday that his December offer for Transat was still available.

Montreal-based Air Canada said it had offered “a significant package of remedies” to satisfy EC anti-trust concerns around competition.

“Air Canada has concluded that providing additional, onerous remedies, which may still not secure an EC approval, would significantly compromise” its ability to compete internationally and recover from the effects of the pandemic on air travel, the airline said in a statement.

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Air Canada in February refused to extend the deadline for its $188.7 million deal for Transat, after European regulators did not give the go-ahead for the buyout.


The two companies had agreed in June 2019 on the acquisition, the terms of which were subsequently amended in August 2019 and then revised in October 2020 as a result of the severe economic impact of the COVID-19 pandemic.

EU antitrust chief Margrethe Vestager said Air Canada offered insufficient concessions to address competition concerns.

“While the coronavirus outbreak has strongly impacted the airline sector, the preservation of competitive market structures is essential to ensure that the recovery can be swift and strong,” she said in a statement.

“The proposed transaction would raise competition concerns on a large number of transatlantic routes. Based on the results of the market test, the remedies offered appeared insufficient.”

The Canadian government said protecting jobs at Transat and preserving the long-term viability of the company, also based in Montreal, is the most important thing for the government.

Transport Minister Omar Alghabra said in a statement that he had spoken with Transat and the two sides were “examining next steps.”

Airlines have been in talks with the federal government since November about a possible aid package, so far to no avail.

Quebec Economy Minister Pierre Fitzgibbon also said the provincial government “will not leave Transat without support.”

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Québecor Inc Chief Executive Péladeau said he had made a new offer for Transat in December and that it was still available. Péladeau, who previously attempted to acquire Transat in his personal capacity as a businessman, said his offer would keep the tour operator independent and competitive.

“This proposition is still valid and included certain conditions that Mr. Peladeau wants to lift quickly in order to to remove the uncertainty the company has found itself in during several months,” the statement said.

A Transat spokesman said the airline’s priority was securing financing and its recovery plan.

“We will also review all our options, including the pursuit of the corporation’s business plan and Mr. Peladeau’s proposal,” Christophe Hennebelle said in an emailed statement.

Transat has said it needed at least $500 million in new financing in 2021. It also has a $250 million short-term subordinated credit facility due on June 30.

The tour operator said it was at an “advanced stage” of discussions on federal government support for the airline sector and accessing Ottawa support for business affected by the pandemic.

Quebec Premier Francois Legault, who co-founded Transat in 1986, said in February that the province was looking at different scenarios for Transat, with or without Air Canada.

Air Canada has agreed to pay a $12.5 million termination payment to Transat.
 

spaminator

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Air Canada reaches $5.9B aid deal in exchange for restoring domestic routes, refunding cancelled trips
Author of the article:Reuters
Reuters
Publishing date:Apr 13, 2021 • 6 hours ago • 2 minute read • Join the conversation
An Air Canada 787 passenger plane takes off at Pearson International Airport on Jan. 24, 2021.
An Air Canada 787 passenger plane takes off at Pearson International Airport on Jan. 24, 2021. PHOTO BY JACK BOLAND /Postmedia Network
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Air Canada, struggling with a collapse in traffic due to the COVID-19 pandemic, reached a deal on Monday on a long-awaited aid package with the federal government that would allow it to access up to $5.9 billion in funds.

The agreement – the largest individual coronavirus-related loan that Ottawa has arranged with a company – was announced after the airline industry criticized Prime Minister Justin Trudeau’s Liberal government for dawdling. The United States and France acted much more quickly to help major carriers.


Canada’s largest carrier, which last year cut over half its workforce, or 20,000 jobs, and other airlines have been negotiating with the government for months on a coronavirus aid package.

In February, Air Canada reported a net loss for 2020 of $4.65 billion, compared with a 2019 profit of $1.48 billion.

As part of the deal, Air Canada agreed to ban share buybacks and dividends, cap annual compensation for senior executives at $1 million a year and preserve jobs at the current level, which is 14,859.

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It will also proceed with planned purchases of 33 Airbus SE 220 airliners and 40 Boeing Co 737 MAX airliners.

Chris Murray, managing director, equity research at ATB Capital Markets, said the deal took into account the “specific needs of Air Canada in the short and medium term without being overly onerous.”

He added: “It gives them some flexibility in drawing down additional liquidity as needed.”

Transport Minister Omar Alghabra said the government was still in negotiations with other airlines about possible aid.

Canada, the world’s second-largest nation by area, depends heavily on civil aviation to keep remote communities connected. Opposition politicians fretted that further delays in announcing aid could result in permanent damage to the country.

Air Canada said it would resume services on nearly all of the routes it had suspended because of COVID-19.

‘SIGNIFICANT LAYER OF INSURANCE’
The deal removes a potential political challenge for the Liberals, who insiders say are set to trigger an election later this year.

The government has agreed to buy $500 million worth of shares in the airline, at $23.1793 each, or a 14.2% discount to Monday’s close, a roughly 6% stake.

“Maintaining a competitive airline sector and good jobs is crucially important,” Finance Minister Chrystia Freeland told reporters, adding the equity stake would allow taxpayers to benefit when the airline’s fortunes recovered.

The Canadian government previously approved similar loans for four other companies worth up to $1.billion, including up to $375 million to low-cost airline Sunwing Vacations Inc. The government has paid out $73.47 billion under its wage subsidy program and $46.11 billion in loans to hard-hit small businesses.

Michael Rousseau, Air Canada’s president and chief executive officer, said the liquidity “provides a significant layer of insurance for Air Canada.”

Jerry Dias, head of the Unifor private-sector union, described the announcement as “a good deal for everybody.”

Unifor represents more than 16,000 members working in the air transportation sector.

But the Canadian Union of Public Employees, which represents roughly 10,000 Air Canada flight attendants, said the package protected the jobs of current workers rather than the 7,500 members of its union who had been let go by the carrier.
 
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spaminator

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Regional air service returning to North Bay in feds' Air Canada deal
Author of the article:postmedia News
Postmedia News
Jennifer Hamilton-McCharles
Publishing date:Apr 13, 2021 • 1 hour ago • 1 minute read • Join the conversation
Jack Garland Airport in North Bay.
Jack Garland Airport in North Bay. Postmedia files
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Regional air service is coming back to North Bay’s Jack Garland Airport as part of the feds’ relief package deal with Air Canada.

Mayor Al McDonald made the announcement on his social media pages Monday.


“North Bay: Great news! Regional air service to North Bay will be restored to North Bay as part of the federal agreement to assist Air Canada. They are returning to other regional airports as well.”

McDonald said city council and staff have both publicly and financially supported keeping Jack Garland Airport open as part of the city’s growth agenda.

“We wanted our aviation companies employing over 500 workers to know we had their backs. This sets the table for further growth in our city in this sector but also for our local businesses and industry that depend on travel for their business.”

McDonald said he has been working with Nipissing-Timiskaming MP Anthony Rota on the return of regional air service since Air Canada announced it was pulling out of the city last year.

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The airport asked the city for $200,000 last April to help cover an unexpected drop in revenue due to the COVID-19 pandemic.

In March, Air Canada announced it was suspending service due to the pandemic, however a few months later in June the airline announced it was suspending services on 30 domestic regional routes and closing eight stations at regional airports in Canada, including North Bay.


In a previous interview, McDonald said it’s not just about the air travellers.

“We’re an economic centre with more than 65 mining companies in the region and many other businesses who depend on the airport to operate their business.”

North Bay and Kingston were the only two Ontario cities to see their regional stations shut down.

McDonald said while no exact timetable has been set because of the pandemic, “this goes a long way in helping us to continue growing our city.”