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Aviation and Aerospace Communities Seek Government Help

Through Ken Pole | March 16, 2020

Estimated reading time 11 minutes, 37 seconds.

Canadian aviation and aerospace industries, facing growing economic uncertainty over the continued spread of COVID-19, urge the federal government to ensure the industry and its thousands of jobs are protected .

Canada's aviation and aerospace industries have asked the federal government to confirm that they will be included in the recently announced stimulus packages.  Provided by Delta Airlines
Canada’s aviation and aerospace industries have asked the federal government to confirm that they will be included in the recently announced stimulus packages. Provided by Delta Airlines

Skies met on March 13 with executives from the Aerospace Industries Association of Canada (AIAC), the Air Transport Association of Canada (ATAC) and the Canadian Business Aviation Association (CBAA) ).

ATAC President and CEO John McKenna said Skies that it “derailed” Canadian aviation as a whole. “I have a number of members who will not survive if this lasts longer than a few weeks.”

He said he was writing directly to Prime Minister Justin Trudeau, Finance Minister Bill Morneau and Transport Minister Marc Garneau in an effort to ensure the aviation industry receives some of the protection promised in the stimulus plan. “It can’t be a promise; it must be hard cash – soon! “

Noting that there had been a “very generous” federal stimulus package in response to September 11, “but it was only for a short time,” McKenna agreed that when it comes to Canada, COVID-19 would have a more serious impact. .

“We need… Aid or air transport services in Canada might not be the same in two weeks,” he reiterated. “These are companies that cannot afford to wait. six months.”

Jim Quick, his counterpart at AIAC, said the organization had sent a special update to its members along with a survey to collect information on the impact of the virus. “This information will be used to help assess what additional measures, if any, we recommend to the federal government,” AIAC said, asking members for comments by noon on March 17.

“We got answers right away,” said Quick. Skies. “People tell us how, potentially, their businesses are impacted. Most companies now have travel bans in place. We have seen a dramatic drop in member attendance as early as the Singapore Air Show (February 11-16). Individually, companies make decisions about, first of all, how to protect their staff. “

On the vulnerability of small businesses, Quick said that obviously depends on their resources. “Big companies have their own challenges; they have more people to protect. I wouldn’t put one group in front of the other in such a situation. Large companies tend to have more resources, so you automatically turn to groups that don’t have these kinds of resources.

The AIAC is “in almost daily contact” with government through Innovation, Science and Economic Development Canada, the department most involved with industry. Its minister, Toronto-area MP Navdeep Bains, has held the industry portfolio since being re-elected to Parliament in 2015 and is generally well respected in the aviation industry.

“We make sure. . . that as they make strategic decisions, they are fully informed about what is going on in the aerospace industry, ”said Quick.

A key part of AIAC’s lobbying effort is ongoing meetings with politicians and senior officials. “We bring in areas of our industry, like small businesses, for example. . . to give them the opportunity to defend their cause directly.

Anthony Norejko, President and CEO of the ACAA, said that while many member companies have already limited non-essential travel, the increased constraints on available commercial seats are leading to increased use of business jets by airlines. senior executives or management teams for whom travel is essential. . “I think it’s because people can recognize that you can control the variables,” he said. Skies.

Air Canada reaffirmed that it is currently entering into an exclusive agreement with Transat AT to purchase all of the outstanding shares of the tourism business.  Air Canada Photo
Air Canada recently announced that it was withdrawing its current financial forecast for 2020 amid continued uncertainty over COVID-19. Photo by Alvin Man / Air Canada

There is also the well-documented fact that commercial carriers may not clean their planes as frequently or as thoroughly, a view confirmed by statements from various operators that they are stepping up their efforts.

“Many of our operators, by the very nature of piloting a [business] a plane like that is like it’s your personal property, ”Norejko said. “So anyone with a sense of belonging takes care of her nine out of ten times. . they’re almost always kept super clean, super shiny, and that extends indoors as well.

He also said the CBAA had shared with its members an advisory to commercial carriers and crews at the Centers for Disease Control and Prevention (CDC) in Atlanta, Ga., On how to deal with, among other things, passengers with virus symptoms “and what you are going to do about the airplane even if you have no symptoms but just want to come back and refresh the plane for the next flight. A cautious business aviation operator… can apply the same lines of thought.

Prime Minister Justin Trudeau said last week the government was preparing a tax support package to help the public and businesses hardest hit by the virus outbreak. An envelope of $ 1.1 billion previously announced would make it possible, among other things, to eliminate the waiting period for employment insurance and put in place flexible provisions to meet the obligations of the Canada Revenue Agency.

The government is urging Canadians to avoid non-essential overseas travel and is planning improved COVID screening of all airport arrivals. “We will continue to assess what we can do and how we can keep Canadians safe,” Trudeau said. “We will not close the door to any idea. “

The Canada Border Services Agency said at least two international airports were apparently unprepared for more intensive screening this weekend. Several reports were released on March 14 and 15 on the lack of testing in Toronto. A passenger arriving in Ottawa from Florida said Skies on March 15, that “absolutely nothing was mentioned about the self-quarantine by anyone at the airport or by the airline”.

Morneau told reporters on March 13 that although $ 10 billion of the extended “stimulus package” would be available through the Business Development Bank of Canada, details would not be released until sometime before the latest budget is tabled. of the government. However, a closure of Parliament until April 20 now means the budget is postponed to an unspecified date.

The effects of the COVID-19 pandemic have spread throughout the aviation industry.  Provided by Delta Airlines
The effects of the COVID-19 pandemic have spread throughout the aviation industry. Provided by Delta Airlines

Another measure to support businesses is the Bank of Canada’s unexpected cut from its target for the overnight rate to 0.75%, its lowest level in two and a half years. “Lower interest rates will help support confidence in businesses and households,” Bank Governor Stephen Poloz said at a press conference with Morneau. “The main fundamental that has changed since our last decision is that oil prices have continued to fall and are showing signs of persistence.”

The United States in particular is isolating itself from the spread of the virus by limiting and in many cases banning international visitors – a move that has prompted at least United and Delta airlines to seek federal government support – the Canadian aviation is feeling the fallout from the growing uncertainty.

WestJet has frozen hiring and is offering employees voluntary time off due to economic uncertainty. The Globe and Mail said the Calgary-based airline is poised to cut international seating capacity by 60 percent and domestic flights by 40 percent. In addition, a representative of WestJet flight attendants said the union was prepared for the airline to lay off more than 50 percent of its cabin crew.

Air Canada issued a statement on March 16 that it is withdrawing its current financial forecast for 2020 in the face of continuing uncertainty over COVID-19. The airline said that although the situation presents “unprecedented challenges”, it has the financial resources to weather the storm.

“These strong assets allow us to fully focus our immediate attention both on the safety and well-being of our customers and employees and on mitigating the financial impact of the virus,” said Calin Rovinescu, President and CEO of Air Canada. He also called for government help for Canadian airlines, “whether it be through tax waivers, landing fees and other charges that are part of the burden of aviation in Canada or otherwise. until the industry stabilizes ”.

WestJet has frozen hiring and is offering employees voluntary time off due to economic uncertainty. Photo by Samuel Millar

Norejko said COVID-19 and the drop in oil prices mentioned by Poloz (the result of a feud between Saudi Arabia and Russia), coupled with any uncertainty about the effectiveness of government responses until present, had combined to put “a lot of pressure” on the Canadian economy.

In addition, operators in general still face the issue of sending crews for recurring training. “Nine times out of 10 it happens in the United States,” Norejko said. “Can I send my crews? It doesn’t matter how much care a business faces when it comes to sending employees on a trip – now you’re faced with the question “My God, can I really get these people back?” If you had to define what is the most expressed concern so far, it is this state of indecision, of flux, and what we are trying to do as an association is provide the most relevant information that helps. operators to make the best decisions we can right now. . . These are sensitive times, for sure. “

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