Liberal opposition to jets at Billy Bishop airport a blow to Bombardier

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The incoming Trudeau government, already facing a tough decision on whether to offer a $1-billion (U.S.) bailout to Bombardier, says it's standing by a different political pledge that will end up hurting the Montreal aircraft maker and its troubled C Series plane.

The Liberals, who take office in Ottawa on Wednesday, confirmed Monday that they remain opposed to allowing jets at Toronto's Billy Bishop airport – which would kill an order worth more than $2-billion to Bombardier.

Porter Airlines Inc. is prepared to buy as many as 30 of Bombardier's C Series planes, but only if the runway at Billy Bishop Toronto City Airport is extended. The federal government is one of three parties that will rule on whether that extension can go ahead.

Authorization for runway extensions necessary to accommodate jets would require renegotiating a tripartite agreement between Ottawa, Ports Toronto and the City of Toronto.

Asked to clarify the Liberal position Monday, Trudeau spokesman Daniel Lauzon provided a copy of a June 4, 2015, letter sent to Toronto Mayor John Tory and city council, signed by Toronto-area Liberal MPs and the chair of the Ontario Liberal caucus, that pledged never to do that.

"We have … pledged not to reopen the Tripartite Agreement," the letter said. "The Liberal Party's policies on the waterfront are as clear as they are forward looking," the MPs wrote.

This Toronto pledge leaves the Liberals in an awkward position. Quebec's Economy Minister Jacques Daoust on Friday said he will ask Ottawa to match a $1-billion lifeline for Bombardier when the Liberals take office Nov. 4.

A request to join a bailout package and the expansion of Toronto's downtown airport are theoretically separate discussions, but a government that kicks in $1-billion to support an airplane program that has struggled to land orders will find it challenging to kill the Billy Bishop expansion plan at the same time and cause the cancellation of a major order.

The Liberal pledge Monday backs up a promise made by Adam Vaughan, who, while a Toronto councillor, MP in the previous parliament and during a successful re-election campaign, opposed the Porter proposal. Mr. Vaughan was re-elected in the central Toronto riding that includes the airport.

"The jet issue. We've made a promise. We will keep that promise. No jets on the waterfront," he said during his victory speech on Oct. 19.

That pledge was made before the Quebec government agreed last week to inject $1-billion into Bombardier and take a 49.5-per-cent ownership in the C Series program.

It was also made before Mr. Daoust said he would be on the phone to the new federal industry minister half an hour after that person is appointed.

"If the federal government comes in, the notion of risk completely changes," Mr. Daoust told Bloomberg last week.

Porter wants the three entities – the federal government, the City of Toronto and Ports Toronto – that control the island airport to agree to 200-metre extensions of both ends of the runway to allow the C Series to take off and land. Porter would offer flights from Toronto to Western Canada, the United States and the Caribbean.

Porter's order for 12 planes and options on 18 more is worth $2.3-billion at 2013 list prices, but is conditional on approval of the expansion.

The Liberal position on the Billy Bishop expansion and helping Bombardier financially is being closely watched in Quebec, where the party gained major ground in the federal election last month.

"It starts with Justin Trudeau," said aviation consultant Robert Kokonis, president of AirTrav Inc. "Does he want to invest $1-billion? They went from extinction in [Quebec] to 40 seats. He's talking about infrastructure, talking about job creation," Mr. Kokonis said.

Bombardier has 243 firm orders for the C Series, which is two years behind the scheduled date of delivery to its first customer and more than $2-billion (Canadian) over the initial budget of $3.4-billion.

Porter spokesman Brad Cicero said Toronto City Council voted 44-0 to undertake a review of the airline's proposal, including participation by all three members of the tripartite agreement that governs the airport.

"If after the full review is complete, and city council determines that it would like to proceed with the proposal, we believe that the federal government should consider the wishes of the people of Toronto when evaluating the proposal," Mr. Cicero said.

With a report from Elizabeth Church

Editor's note: A previous version of this news story on the Toronto island airport incorrectly said the expansion proposal is asking for 168-metre extensions of both ends of the runway. In fact, the proposal is for 200 metres at each end.