GTAA issues notification regarding COVID-19 impact on aeronautical rates
As a result of the COVID-19 pandemic, air travel at Toronto Pearson Airport has decreased, which consequently has seen a downturn in the Greater Toronto Airports Authority’s aeronautical revenues.
The downturn in air travel at Toronto Pearson Airport (YYZ) as a result of the COVID-19 pandemic has significantly reduced the Greater Toronto Airports Authority’s (GTAA) revenues and in turn caused the company to incur a large amount of incremental debt to finance its operations. Since the outset of the COVID-19 pandemic, the GTAA has taken many significant steps to responsibly reduce and prioritise operating and capital expenditures, including the reduction in planned 2020 capital spend by $265 million and reducing its workforce by 27 per cent in July 2020.
To keep pace with inflation, to reflect the benefits of access to Canada’s busiest airport and its proximity to Canada’s largest economic region, and to sustain strong financial liquidity, the GTAA is announcing the following changes to aeronautical rates, effective 1 January 2022:
- Aeronautical rates for commercial aviation will increase by three per cent.
- Aeronautical rates for all business and general aviation aircraft, regardless of weight, will increase to $850 per arrival.
Prior to the COVID-19 pandemic and required 2021 increases, commercial aeronautical rates had not increased at Toronto Pearson for 13 years during a period of strong growth at the airport.
Deborah Flint, President and CEO, GTAA said: “The impact of the pandemic on Toronto Pearson’s business and Canada’s aviation sector continues to be felt. These modest increases will allow us to keep pace with rising inflationary costs and help to position the GTAA fiscally for recovery, but are mindful of cost pressures still felt across the sector.”
“The GTAA has incurred a net loss of $628 million over the last 18 months,” said Ian Clarke, Chief Financial Officer, GTAA. “Despite the dramatic impacts that the COVID-19 pandemic has had on Toronto Pearson, the GTAA has continued to meet all its financial obligations, including those to its host municipalities, largely through debt financing. These changes align our aeronautical rates with the benefits of access to Canada’s largest airport, situated in the middle of the country’s second-largest employment area.”