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Canadian Airlines Ready to Brave COVID-19 Impact

An Air Canada 787-9 in Los Angeles (Photo: AirlineGeeks | Ben Suskind)

The outbreak of Covid-19 has brought the aviation industry to its knees and airlines to the brink of bankruptcy. However, in Canada, a different story is emerging from the country’s two largest airlines. Global News experts have stated both Air Canada and WestJet appear to have enough cash in order to survive the immediate impact of the outbreak. Although both airlines have made dramatic reductions in service and reduced staff to minimize cost, the airlines appear to have enough cash liquidity to survive in the short-term. 

Air Canada has made 5,100 flight attendant redundant and is suspending most international flying from the end of the month. However, the airline has cash reserves of $7.3 billion Canadian dollars ($5.8 billion USD), more than Delta Air Lines in the United States, the most profitable airline in the country.

WestJet has historically posted quarterly profits for all but one quarter in the past 14 years, but the airline will be facing similar problems. So far it has halved its domestic routes as well as suspending trans-border and international flights for 30 days.

However, WestJet is privately owned, meaning it has not been affected by stock market uncertainty that has been occurring since the outbreak began. However, smaller, regional airlines in Canada are at a greater risk. Many don’t have the cash reserves of WestJet and Air Canada and likely face more damage. Porter Airlines has already announced that it is suspending operations until at least June.

Although the Canadian aviation industry has been lobbying for financial relief from the government, they are yet to include aviation in any relief packages as of yet. Other countries such as New Zealand and Norway have already announced plans to give their aviation industries millions in government loans to get through the outbreak.

US airlines have warned that they will soon be in dire financial straits unless the government steps in to give financial support. 

Daniel Morley

Author

  • Daniel Morley

    Daniel has always had aviation in his life; from moving to the United States when he was two, to family vacations across the U.S., and back to his native England. He currently resides in South Florida and attends Nova Southeastern University, studying Human Factors in Aviation. Daniel has his Commercial Certificate for both land and sea, and hopes to one day join the major airlines.

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