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Airline industry calls for major cash injection from feds amid COVID-19 pandemic

Citynews 1130 Vancouver

Last Updated Mar 20, 2020 at 10:59 am PDT

FILE - Air Canada announced Thursday, March 19, 2020 more than 5,000 workers will be laid off as of April 30 due to reduced demand and government restrictions due to COVID-19. (NEWS 1130 files)
Summary

Consequences of government travel restrictions are dire for many airlines: ATAC president

At least a dozen small and medium airlines are in danger of going bankrupt, McKenna says

As many as 25,000 jobs are at risk, he says

VANCOUVER (NEWS 1130) – With Air Canada laying off thousands of workers amid airlines paring down operations during the coronavirus pandemic, the industry is calling for a major cash injection from the federal government, warning tens of thousands of jobs hang in the balance.

“Right now, we are getting no volumes, government has asked people not to travel. The consequences are dire for many airlines,” said John McKenna, president Air Transport Association of Canada.

Unless there’s significant federal cash soon, at least a dozen small and medium airlines are in danger of going bankrupt, he added, putting as many as 25,000 jobs at risk.

The financial aid announced earlier this week won’t cut it because it comes in the form of tax deferrals, and McKenna said cash is need now just to keep operations alive.

He estimates the industry needs a minimum of $5 billion, and the longer travel restrictions persist, the more money will be needed.

The federal government has suggested more than the $82 billion aid package is coming, but hasn’t said when that will come.

Air Canada announced Thursday more than 5,000 workers will be laid off as of April 30 due to reduced demand and government restrictions due to COVID-19.

A day earlier, the airline said it would be gradually suspending the majority of its international and U.S. flights by the end of March amid the pandemic.

Swoop also said Thursday it will suspend all international and transborder flights as of Sunday to combat the spread of COVID-19 and focus on bringing home Canadian customers abroad.

Earlier in the week, WestJet warned those who flew on six different flights in March that some passengers have tested positive for COVID-19.

On Friday, Pacific Coastal Airlines announced it is temporarily suspending operations as of Tuesday because of the coronavirus. It plans to resume scheduled operations on Sunday, May 3, if conditions allow. Pacific Coastal will continue to operate WestJet Link under the guidance and direction of WestJet.

Pacific Coastal is a privately owned, B.C.-based, regional airline operating from Vancouver International Airport’s South Terminal.