Air Canada CEO Expresses Confidence That Ottawa Will Provide Aid Package As Airline Records Annual Loss
Air Canada's chief executive and a top union official expressed confidence that Ottawa will provide an aid package for airlines after the carrier recorded its biggest annual loss in at least 19 years...
Air Canada's chief executive and a top union official expressed confidence that Ottawa will provide an aid package for airlines after the carrier recorded its biggest annual loss in at least 19 years due to COVID-19.
Air Canada recorded a net loss of C$4.65 billion ($3.65 billion) for 2020, compared with a 2019 profit of C$1.48 billion.
Airlines have been among the hardest hit by the epidemic as people stay home.
Canada's largest carrier, which last year cut over half of its workforce, or 20,000 jobs, and other airlines are negotiating with the Liberal government on an aid package.
"I am very encouraged by the constructive nature of discussions that we have had...I am more optimistic on this front for the first time," Air Canada CEO Calin Rovinescu said.
President of the Unifor private sector trade union Jerry Dias said that he is confident that an aid deal will happen.
"I've been speaking to the federal government as well as Calin and everybody and there's no question, it's imminent," Dias said in a phone interview, without providing further details.
A government source in the finance ministry, which is leading the talks, declined to comment on Rovinescu's remarks on the grounds that the negotiations are continuing.
Canada has previously said that passenger refunds and the restoration of regional routes will have to be part of a deal.
Carriers agreed in January to suspend winter travel to certain sun destinations through April 30 amid fears that new strains of COVID-19 would spread during spring break.
Rovinescu, who is retiring this month, told analysts that he expects an "improved dynamic" around the end of April, with COVID-19 testing replacing some quarantines.
Canada has some of the world's toughest travel rules with a mandatory 14 day quarantine for arrivals and some domestic restrictions.
"It will not be completely eliminated, but we do see the potential for it to go to a five to seven day quarantine," Rovinescu said.
Asked about the CEO's comments, Canada's chief medical officer, Theresa Tam, said, "it's probably premature right now to know what is happening at the end of April."
Further Cost Reductions, Capacity Reduction Plans And Net Cash Burn Projection
Air Canada said that it is seeking further cost reductions, plans to reduce its first quarter capacity by approximately 85% compared with a year earlier, and projects quarterly net cash burn of between C$1.35 billion and C$1.53 billion.