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Why no airline bailout in Canada like other G7 countries?

Why no airline bailout in Canada like other G7 countries?

Old Aug 1, 20, 12:42 pm
  #1  
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Why no airline bailout in Canada like other G7 countries?

Does anyone have an idea what the governmentís game plan is with the airline industry in Canada? It strikes me as very odd that Canada has not given an airline industry specific bailout package.

The airlines are obviously a challenging business model with unique needs that canít be met by blanket loans with 8% interest rates (after the first year) like the Liberals are offering. U.S. carriers have received about US$10 billion each in wage support and loans, and European rivals apparently received 10-11 billion euros. Itís as if the government wants our airlines to go under? We saw that Air Canada just lost 1.7 billion in the last quarter.

Currently the ďstrategyĒ appears to be: You arenít allowed to do business because we deem
it to be unsafe, but we also wonít provide meaningful support to prop up your industry. It does make me wonder if this riff will end up in a lawsuit between the airlines and the government like in the UK.

Does anyone have insight?

Last edited by Michaelsegundo; Aug 1, 20 at 12:48 pm Reason: Spelling mistake
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Old Aug 1, 20, 12:57 pm
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There is a broad wage support program in Canada and Air Canada stopped participating in it after about a month, doing mass layoffs instead.

So comparing the $ value of support from the US government, much of which was wage support, is not really a fair comparison.

Air Canada has also withheld untold millions of dollars in refunds owed to customers, placing thousands of Canadians who do not have access to a market rate line of credit from the government in financial hardship. The Canadian government has blessed this approach by refusing to intervene on behalf of customers.

The US and European bailouts have all had significant strings attached, including limits on executive bonuses and employee layoffs. It seems to me that the sticking point is not Ottawa's unwillingness to support the industry, but AC's refusal to accept any concessions in return for tailored support beyond that which is offered to all businesses through the CEWS and LEEFF programs.

Air Canada wants to have the cake and eat it too: demand a bailout on its own terms, not Ottawa's. Sorry, but beggars can't be choosers. They have even had the audacity to suggest governments should lift public health restrictions on travel to benefit their bottom line.
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Last edited by eigenvector; Aug 1, 20 at 1:03 pm
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Old Aug 1, 20, 1:46 pm
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To the average Canadian, once they read what Calin Rovinescu's salary has been for the past few years, they won't be too enthusiastic on an Air Canada bailout. The optics to Joe Sixpack are not good.
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Old Aug 1, 20, 1:50 pm
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Exclamation

As this topic deals with financial aid or lack thereof for the whole Canadian aviation industry it's been relocated to the Canada destination forum for further discussion.

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Old Aug 1, 20, 8:36 pm
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The consumers are bailing them out.

They sell tickets for flight that will get cancelled and keep the money collected issuing crediting the blessing of the Canadian government.
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Old Aug 2, 20, 11:06 am
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Doesn't Air Canada get a bailout every decade or so?
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Old Aug 3, 20, 12:54 pm
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Originally Posted by theshaun View Post
Doesn't Air Canada get a bailout every decade or so?
They are overdue
And dont forget the subsidies they have been continously getting with government imposed restrictions on foreign carriers flying in Canada that would crush AC if given the chance.

In a way them stealing millions of dollars for cancelled flights is almost a more fair way of stealing from the public than an outright bailout, it doesnt affect those taxpayers who never use AC.
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Old Aug 3, 20, 1:23 pm
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Originally Posted by rankourabu View Post
They are overdue
And dont forget the subsidies they have been continously getting with government imposed restrictions on foreign carriers flying in Canada that would crush AC if given the chance.

In a way them stealing millions of dollars for cancelled flights is almost a more fair way of stealing from the public than an outright bailout, it doesnt affect those taxpayers who never use AC.
you do realize that the refund money is pennies compared to the actual costs of running an airline, hence why most western airlines have received billions. We arenít talking a paltry 10 million here or whatever the refunds would amount to.
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Old Aug 3, 20, 2:04 pm
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Originally Posted by Michaelsegundo View Post
you do realize that the refund money is pennies compared to the actual costs of running an airline, hence why most western airlines have received billions. We arenít talking a paltry 10 million here or whatever the refunds would amount to.
You think they only stole 10 million? Maybe per day.
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Old Aug 3, 20, 5:24 pm
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Originally Posted by Michaelsegundo View Post
you do realize that the refund money is pennies compared to the actual costs of running an airline, hence why most western airlines have received billions. We arenít talking a paltry 10 million here or whatever the refunds would amount to.
Originally Posted by rankourabu View Post
You think they only stole 10 million? Maybe per day.
Let's see now, 50,000 in the pending class action, which a percentage of all those who are taken advantage of, plus all the cancellation foreign ticketholders? Think you're short a few zeros!

Master thread Air Canada Refunds vs credits; Class action lawsuit filed
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Old Aug 3, 20, 8:47 pm
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Originally Posted by Michaelsegundo View Post
you do realize that the refund money is pennies compared to the actual costs of running an airline, hence why most western airlines have received billions. We arenít talking a paltry 10 million here or whatever the refunds would amount to.
I can only take a profound consolation that your math teacher is likely not around to step in
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Old Aug 3, 20, 8:54 pm
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Sorry, no offence!

Last edited by Eugeniusz Bodo; Aug 3, 20 at 9:01 pm
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