Canada’s airports call for federal financial relief to survive COVID-19 crisis

Canada’s airports have urged the federal government to help them with both short and longer-term relief measures in order to survive the impact of the coronavirus pandemic

Passenger volumes are expected to decline by more than 50 per cent between March and June 2020, and a revenue loss of $1.3 billion or more in 2020 is currently projected, due to the impact of COVID-19 on travel.

“We are now facing the grim reality that many parts of the aviation sector could shut down without government action and relief,” said the Canadian Airports Council (CAC) President, Daniel-Robert Gooch. 

Most pressing is the loss of airport operating revenues caused by flight cancellations and drastic declines in passenger traffic. These negatively affect revenue generated by landing and terminal fees charged to air carriers, as well as per-passenger fee revenue. 

Meanwhile, many airport operational costs related to safety, runway maintenance, aircraft movements and passenger services are fixed and cannot be reduced in proportion to reduced traffic volumes. In fact, with increased protocols aimed at controlling the spread of COVID-19 in place in terminals throughout the country, costs at Canada’s airports have increased.

The CAC is urging the federal government to take swift action to ensure the continued financial viability of Canada’s airports, by providing short-term relief to address immediate cash flow challenges and ensure that airports can continue operations and rebound from this crisis:

• Rent relief of at least one year, to allow airports to redeploy these funds to continue operations and support their recovery strategies.
• Financial relief for reduced cash flow: Airports ask the federal government to put into place a programme to direct new funds to airports to compensate for their lost revenues and increased costs.
• Regulatory flexibility and funding: Flexibility to adjust tight implementation deadlines and dedicated federal funding to help airports meet recent regulatory requirements.

“The operational and financial challenges Canada’s airports are facing from COVID-19 are unlike anything the industry has seen,” said Gooch. “With events moving so rapidly, our estimates, as dire as they are, are virtually out of date as soon as they are released. We really don’t know where the bottom is yet.”