Air Canada says it will gradually suspend most of its international and U.S. flights by March 31, in response to government moves to close borders as the COVID-19 outbreak spreads.
The country’s largest airline made the announcement on the same day Canada and the U.S. said their shared border would close, and hours after two other domestic carriers said they would temporarily halt service and lay off employees.
“The restrictions on travel imposed by governments worldwide, while understandable, are nonetheless having a cataclysmic effect upon the global airline industry,” said Calin Rovinescu, chief executive of Air Canada, which employs 36,000 people and flies about 190 planes, not including more than 100 aircraft in its Rouge and Express divisions.
Toronto-based Porter Airlines will stop flying on March 20, and leisure carrier Air Transat said Wednesday that it is gradually suspending flights until April 30 as the global airline industry descends into an unprecedented crisis. The two carriers’ moves follow similar steps this week by Sunwing Airlines.
WestJet Airlines, Canada’s second-biggest carrier, also said this week it will halt international and U.S. flights as of March 23.
Airlines have parked planes, laid off staff and cut expenses to preserve their balance sheets as demand for air travel falls to almost zero.
Most of the world’s airlines have just three months of cash on hand and many will fail in the coming months, warns the International Air Transport Association (IATA), an industry group. It estimates global revenue losses have exceeded US$113-billion and says the industry is in desperate need of government aid totalling US$150-billion to US$200-billion.
Canadian airlines are urging the federal government to provide bailouts in the form of cash, tax breaks, reduced landing fees and lender intervention to protect jobs and vital transportation links.
John McKenna, head of the Air Transport Association of Canada, said airlines face the risk of bankruptcy without cash to help them through the crisis. “The government has been telling people not to fly, not to travel. We’re saying you can’t say that and not help us out,” he said.
Prime Minister Justin Trudeau unveiled a $27-billion package of emergency measures Wednesday to help Canadians and businesses, plus $55-billion in tax deferrals, but has yet to outline any specific aid for the airline industry.
“That’s not nearly enough,” Mr. McKenna said. “There needs to be a cash-flow input.” He said he did not have a specific amount but it is “nowhere near” the US$50-billion government bailout sought by U.S. airlines.
He said he is in daily contact with senior officials at Transport Canada and the Ministry of Innovation, Science and Economic Development about aid but has not been given any assurance.
“I’m going to be calling them back today and saying: Okay, where’s the money?”
Air Canada’s flight suspensions will last until April 1, when the airline will resume a small number of international and U.S-bound routes from select Canadian cities. Air Canada said it will serve its Canadian markets after April “with a significantly reduced network.”
Its international destinations from April 1 will be limited to six cities, down from 101: London, Paris, Frankfurt, Delhi, Tokyo and Hong Kong. U.S. airports will be cut to 13 from 53: New York (LaGuardia and Newark), Boston, Washington (Dulles and Reagan), Chicago, Houston, Seattle, San Francisco, Los Angeles, Denver, Orlando and Fort Lauderdale.
The airline’s Canadian network in April will be cut to 40 airports from 62, subject to more reductions based on demand.
Porter said it plans to resume service on June 1, and said its planes are ready in the meantime to assist with the transportation of government officials, public-health requirements and other needs. Porter spokesman Brad Cicero said a majority of the company’s 1,500 employees will be laid off after Friday.
Montreal-based Air Transat said it will operate repatriation flights to bring its customers back to Canada over the next two weeks, before winding down operations and parking its 40 planes. The carrier has about 5,000 employees and says a “significant” number of them are affected.
Transat said seat sales have been halted immediately for flights to the Caribbean and Mexico but will remain available between Montreal-Paris-Lisbon and Toronto-London-Lisbon to allow as many people as possible to return. It said domestic fliers should check its website to ensure their flights have not been cancelled. The airline said the layoffs will be temporary.
“This is an unprecedented situation, beyond our control, which is forcing us to briefly suspend all of our flights to contribute to the effort to fight the pandemic, protect our customers and employees and safeguard the company,” said Jean-Marc Eustache, Transat’s co-founder and chief executive officer, in a statement. “We are doing everything we can so that this has as little impact as possible on our employees and customers, whom we will make sure to bring back home.”
On Tuesday, Sunwing said it is suspending outbound flights and issuing layoff notices as it flies customers back from resort destinations. About 470 pilots and an undetermined number of cabin crew members will be out of work.
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