In exchange for assistance, the carrier is offering refunds to customers who purchased non-refundable fare, but had not traveled since February 2020 due to an epidemic.
Air Canada and the Canadian government agreed on Monday funding that would allow the airline to raise up to $ 5.9 billion Canadian (US $ 4.7 billion) to help it recover from the economic damage caused by the epidemic.
Deputy Prime Minister Christia Freeland said the support included $ 4 billion Canadian (US $ 3.2 billion) in debt and $ 500 million Canadian (US $ 398 million) in equity that would give Canada a stake in Air Canada, the nation’s most Is a large airline.
As a part of the financial package, Air Canada has agreed to several commitments related to customer refunds, service to regional communities, restrictions on the use of funds provided, employment and capital expenditures.
In exchange for assistance, the carrier is offering refunds to customers who purchased non-refundable fare, but had not traveled since February 2020 due to an epidemic.
In exchange for the bailout, the airline is resuming service to all regional communities where the service was suspended.
Ms Freeland, who is also the Finance Minister of Canada, said the airline had also guaranteed that there would be no further job losses. It said there would also be no stock buyback or dividend and executive compensation would be capped. Ms. Freeland said that the total compensation for any executive is capped at $ 1 million Canadian (US $ 800,000).
“These are difficult and unprecedented times for our airline industry and our workers, as well as for Canadian travelers,” Ms. Freeland said in French. “The airline industry is a strategic sector.”
Ms Freeland said the government was also talking to other Canadian airlines to determine what type of assistance they needed.
Air Canada lost $ 4.6 billion Canadian (US $ 3.6 billion) in 2020, compared to $ 1.5 billion Canadian (US $ 1.2 billion) gain a year earlier.
Organizations supporting Air Canada’s bailout include Unifor and the Canadian Air Traffic Control Association, as well as unions such as the National Airlines Council of Canada Industry Group.
.
Leave a Reply