Air Canada, WestJet could be set for coronavirus help from Canada
This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.
The Canadian government is offering more support to Air Canada and WestJet with a new loan program aimed at large companies hit hard by the coronavirus pandemic.
Dubbed the Large Employer Emergency Financing Facility (LEEFF), Canada will provide loans starting at 60 million Canadian dollars ($42 million) to companies with annual revenues of at least CA$300 million, according to a Monday statement from Prime Minister Justin Trudeau’s office.
Air Canada and WestJet could qualify for the new aid funds. Smaller carriers, like Air Transat and Porter Airlines, are assessing whether they qualify, though they also have access to other Canadian government funding sources to help them bridge the crisis.
Get Coronavirus travel updates. Stay on top of industry impacts, flight cancellations, and more.
The aid package in Canada is similar to the $25 billion in loans available to U.S. airlines under the country’s $2 trillion coronavirus aid package, known as the CARES Act. While separate from the payroll assistance carriers have already accessed, Alaska Airlines, American Airlines, United Airlines and others have applied for funds from the U.S. Treasury.
Airlines taking assistance would also face similar strings on both sides of the border. These include barring dividend payments and stock buybacks, or using funds for executive pay.
The one leg up that Canadian carriers appear to have is an absence of minimum schedule requirements. These rules in the CARES Act have forced U.S. airlines to fly nearly empty planes, further straining their balance sheets and pumping unneeded carbon into the air.
Without a requirement to fly unnecessary flights and by an odd twist of fate, Vancouver-based seaplane operator Harbour Air is due to fly more flights than either Air Canada or WestJet in May, according to Cirium schedules. In a normal month, Harbour flies less than a fifth the number of flights of either larger carrier.
Related: Air Canada suspends all US flights, likely for first time in nearly 80 years
In addition, Air Canada, Porter and WestJet have suspended all of their flights to the U.S.
WestJet will review the new LEEFF program before deciding on “next steps,” spokesperson Lauren Stewart told TPG.
Related: Porter Airlines to suspend flights until at least June
Porter is assessing whether it qualifies for the LEEFF funds before it will evaluate whether to take advantage of the program, spokesperson Brad Cicero said.
An Air Canada spokesperson did not immediately respond with comment.
Air Canada, Air Transat, Porter and WestJet have all accepted payroll support from the Canadian government’s emergency wage subsidy program.
Related: First look onboard Air Canada’s new Airbus A220
Featured image by Andrew Chin/Getty Images.
Sign-up Successful!
Welcome to The Points Guy!
Earn 90,000 bonus miles after you spend $3,000 in purchases on your new Card in your first 3 months. Offer ends 8/3/2022.
With Status Boost™, earn 10,000 Medallion Qualification Miles (MQMs) after you spend $25,000 in purchases on your Card in a calendar year, up to two times per year getting you closer to Medallion Status. Earn 3X Miles on Delta purchases and purchases made directly with hotels, 2X Miles at restaurants and at U.S. supermarkets and earn 1X Mile on all other eligible purchases. Terms Apply.
- Limited Time Offer: Earn 90,000 bonus miles after you spend $3,000 in purchases on your new Card in your first 3 months. Offer ends 8/3/2022.
- Earn up to 20,000 Medallion® Qualification Miles (MQMs) with Status Boost® per year. After you spend $25,000 in purchases on your Card in a calendar year, you can earn 10,000 MQMs up to two times per year, getting you closer to Medallion® Status. MQMs are used to determine Medallion® Status and are different than miles you earn toward flights.
- Earn 3X Miles on Delta purchases and purchases made directly with hotels.
- Earn 2X Miles at restaurants worldwide including takeout and delivery in the U.S., and at U.S. supermarkets.
- Earn 1X Miles on all other eligible purchases.
- Receive a Domestic Main Cabin round-trip companion certificate each year upon renewal of your Card. Payment of the government imposed taxes and fees of no more than $80 for roundtrip domestic flights (for itineraries with up to four flight segments) is required. Baggage charges and other restrictions apply. See terms and conditions for details.
- Enjoy your first checked bag free on Delta flights.
- Fee Credit for Global Entry or TSA PreCheck® after you apply through any Authorized Enrollment Provider. If approved for Global Entry, at no additional charge, you will receive access to TSA PreCheck.
- Enjoy an exclusive rate of $39 per person per visit to enter the Delta Sky Club® for you and up to two guests when traveling on a Delta flight.
- No Foreign Transaction Fees.
- $250 Annual Fee.
- Terms Apply.
- See Rates & Fees
Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.
Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.