Airlines Seek Subsidies, Loans And Tax Relief From Ottawa - Part 2
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G THE GLOBE AND M AIL
RE P O RT O N BUS I N ES S
Students: Some pupils could be eligible for emergency aid FROM B1
Michael Reale, a graduating student at the Ontario College of Art and Design University in Toronto, had a meeting with a potential employer cancelled at the last minute. “There’s not really a plan at all” right now, he said. “The typical things that one would plan to do [for work] are now super cloudy.” Cassidy Westrop, who’s wrapping up a master’s of architecture at the University of Calgary, is also struggling to find work. “Even previous to this, we all had anxiety about finding jobs,” she said. Students and graduates will be joining the labour market during the worst economic shock that Canada has seen in generations. Bank of Nova Scotia recently projected gross domestic product will plunge at a 28-per-cent annualized rate in the second quarter, far exceeding the worst declines of the Great Recession of 2008-09. Many economists say the jobless rate will surge into double digits. For new graduates, joining the job market during a recession can have lasting consequences. A 2012 study in American Economic Journal: Applied Economics tracked the long-term impact on earnings for Canadian men who graduated in past recessions, finding the cost “is substantial and unequal. Unlucky graduates suffer persistent earnings declines lasting 10 years. They start to work for lower paying employers and then partly recover through a gradual process of mobility toward better firms.” More recently, Royal Bank of Canada published a report that analyzed outcomes for graduates who joined the labour force during and immediately following the 2008-09 downturn. “After the Great Recession, more young, university-educated Canadians found themselves doing jobs that didn’t match their education level – especially compared with those entering the work force in the first part of the 2000s,” the report read. “They were more likely to be working part-time, and not by choice. They were less likely to be working in specialized skilled or managerial roles, and more likely to be working in unskilled occupations.” The early years of one’s career are especially crucial, RBC noted, because that’s when wage increases are typically the largest as workers begin to accumulate experience. Some students may be able to tap into emergency aid that Ottawa recently unveiled and which will provide workers
Mr. Yeaman has also retained his production staff, even if it meant they would be doing maintenance. “I’ve committed with my staff we would not lay anybody off, regardless of how much work we have,” he said. Working with a firefighter, a paramedic and a local physician who serves high-risk patients, MPC designed a headset component for medical face shields. They have been contacted by hospitals in Toronto, Barrie, Orillia and Simcoe County and are in negotiations to supply the federal government. Along the way, the company learned it needed to use material that was compliant with ISO 10993, an international standard for medical devices that ensures the product can come into contact with the human body without adverse reaction. The firm used a 3-D printer to complete a prototype sample and will next need to retool the plant with newly made injection moulds for the mass production. Mr. Yeaman expects the first mould to be ready in four weeks and would produce 5,000 a day. “Getting the product to mass-volume numbers in four weeks is herculean. A product like this would typically take four to six months,” he said. MPC is only making the headset for the face shields. Another company will provide the transparent visors. The final product has to comply with regulatory standards. As newcomers to medical manufacturing, MPC is leaving the red tape to
Second-year University of Ottawa student Grace Gallien is seen on Saturday at her family’s home in Richmond Hill, Ont., where she is finishing the school year. ‘I’m not even sure if I will [go back to work] because I don’t want to put my parents at risk,’ she says. CHRISTOPHER KATSAROV/THE GLOBE AND MAIL
affected by COVID-19 with $2,000 monthly for up to four months. To qualify, workers must have earned at least $5,000 in work income in 2019, or the 12-month period prior to application. In a post to her website, federal cabinet minister Maryam Monsef said students who satisfy the income threshold qualify for the benefit. Government legislation did not say anything about income from scholarships or bursaries. The job market is a concern for returning students as well. Grace Gallien, a second-year student at the University of Ottawa, recently received a notice from her landlord that her rent will be hiked by 23 per cent, to $1,200 monthly from $975, on Aug. 31. (Her building is new and thus not subject to provincial rent-control guidelines.) She wants to remain in the building and is hoping the building’s owner will reconsider the rent hike. “I cannot believe they did this in the middle of this pandemic,” Ms. Gallien said. “One of the very first things I thought of was, ‘I need to get as many hours as I possibly can.’ ” Ms. Gallien is fortunate enough to have a job lined up – but it’s retail work that puts her in direct contact with others, rais-
ing her potential virus exposure. “I’m not even sure if I will [go back to work] because I don’t want to put my parents at risk,” said Ms. Gallien, who’s finishing her school year from her family home in Richmond Hill, Ont. Will Graham, a third-year student at the University of Toronto, planned to return to his jobs from last summer – at a summer camp and restaurant – but that’s been thrown into doubt. “I’m going to try and find work in any way I can,” he said, adding that grocery delivery was an option. One concern is that some students, facing a loss of income, will be forced to add more debt to afford tuition. “I’m hoping student-loan programs can step in for any student who would have had to take on extra debt for the fall,” Dr. Schirle said. “There are opportunities here to offer that as grants rather than loans, where there is need.” For now, Ms. Daboo at UPEI is “living really frugally” to stretch her finances and preparing to defend her thesis on Zoom, the video-conferencing application. “No one could have predicted this could happen,” she said. “No one can predict how long this will go on. So the most we can do is just hold tight and stay hopeful.”
a business partner, Sterling Industries, based in Concord, Ont., which specializes in contract manufacturing and assembling medical devices. “Sterling is already discussing directly with the federal government. So they already have the contacts,” Mr. Yeaman said. “Our key was to apply what we do best and find a collaborative partner for the skills that we don’t necessarily have, thereby making the project fully viable and we know we can get it to market. Because that’s where everybody else is struggling … How do I get it certified? How do I get it to market? What are the distribution channels?” Other companies are undertaking similar efforts. Ontario Premier Doug Ford said last week that Ontario auto parts manufacturers Linamar Corp., Magna International Inc. and Martinrea International Inc. were working together to build ventilators. Another manufacturer, Woodbridge Group, will make N95 respirators. George Courey Inc., a supplier of medical garments based in Laval, Que., is already familiar with the health-care sector but has also had to make adjustments. In normal times, the company keeps a reserve of 75,000 to 100,000 pieces. That supply was gone in two days after the outbreak started. “So think about it, in two days we went through our annual stockpile and since then we’ve sold half a million isolation gowns that were in production. These are abnormal times,” chief executive Jeff Courey said. His company makes isolation and sur-
gical gowns. They are classified according to the risk levels they can handle, from Level 1 to 4. Isolation gowns, which are worn by nurses, patients and visitors in a hospital, are protected up to Level 2, meaning the fabric can resist pressure equivalent to a 20-centimetre water column. Surgical gowns used in operating rooms offer Level 2 to 4 protection. A Level 4 gown should shield from blood or viral penetration and has seamless seals. Completed gowns are inspected over light tables to spot defects in the fabric, then sent out to institutional laundries to be washed and disinfected before use. The fabric for Courey’s Level 4 products comes from Germany and Belgium. The surgical gowns are assembled in Laval. Some of the isolation gowns are made in China, the rest at the Laval facility. Normally the fabric is shipped by sea freight but now they are coming by air, along with other medical gown manufacturers from the rest of the world. “Everybody is trying to airship things out of China. It’s like a battle between nations to see who can get the most stuff out of China as quickly as possible,” Mr. Courey said. A third of his company’s output used to be linen for the hospitality sector, but with hotels and restaurants now dormant, all of his resources are now focused on medical protective equipment. “The ingenuity and creativity of Canadian enterprise is incredible and we’re seeing it especially during this period,” Mr. Courey said.
Redemptions: Wave of activity may be nearing, expert says FROM B1
“It is difficult to offer a meaningful outlook when the precise impact and length of the COVID-19 pandemic remains unknown.” As the coronavirus and its resulting COVID-19 disease continue to disrupt markets, the potential for a “tsunami” of mutual fund redemptions is getting closer, said Martin Pelletier, portfolio manager with Wellington-Altus Private Wealth Counsel Inc. “While ETF [exchange-traded funds] investors have been hitting the panic sell button over the past few weeks, those in mutual funds may not have reacted yet as they likely have an adviser in the middle,” Mr. Pelletier said. “My worry is what investors will do once opening their quarterly statements that are about to be sent out.” Like many of its competitors in Canada, AGF is also facing a decline in its overall assets under management as tumbling markets drive down the value of stocks held in the company’s mutual funds.
MON DAY , MARC H 30, 2020
Airlines FROM B1
Equipment: Production retooling happening at ‘herculean’ rate FROM B1
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The company reported assets under management of $33-billion as of March 24, a 12-per-cent drop from $37.6-billion for the quarter ending Feb. 29. Market declines are also putting pressure on the revenue streams of mutual fund firms, as lower asset levels reduce the sales commissions paid by investors. Management expense ratios are typically lower on fixed-income funds than equity funds, says Marcos Alvarez, senior vicepresident of global financial institutions at DBRS Morningstar. “Investor behaviour might see many retail clients change their portfolio allocations from equities to fixed-income products,” he said. “This typically results in lower commissions for the fund companies.” Prior to the COVID-19 outbreak in North America, Canada’s mutual fund industry had seen some positive signs in overall redemption levels. The latest numbers released by the Investment Funds Institute of Canada last week reported no net redemptions for the month of February for both mutual funds
and ETFs. Further redemptions by retail investors may not be felt by some fund managers until later in April, when some households under stress because of unemployment may need to liquidate. “A lot of individuals are still processing what the government relief package means for their personal financial situation as well for those with small businesses, and that can have an impact on whether someone decides to sell an investment fund or not right now,” Mr. Alvarez from DBRS Morningstar said. Not all investors have the option to redeem their holdings in all types of investment funds. Several real estate funds have temporarily halted all investor activity in their Canadian real estate funds. The spread of COVID-19 has affected global property markets, making it difficult to value properties. Both Canada Life Assurance Co. and Trez Capital have announced they are no longer allowing investors to redeem, contribute or transfer funds in several of their real estate funds.
Unions representing 40,000 Canadian airline workers met Saturday with Finance Minister Bill Morneau and Transportation Minister Marc Garneau to share their concerns and provide solutions to ensure the sector’s viability. The groups urged the government to consider measures similar to those under the U.S. emergency relief legislation, including that affected workers are to be provided top-up benefits where 80 per cent of wages are guaranteed while health benefit plans are maintained. They also want any government support to be accompanied by tight restrictions on executive compensation and shareholder-friendly policies such as dividend payments and share buybacks. Aid is being sought to keep Canada’s air travel companies afloat and able to meet their financial obligations but also to allow the system to recover after the pandemic passes. The thinking is that if the companies have no cash, a restart of operations will be slow even if there is pentup demand. Canadian airlines have laid off thousands of people, parked planes and suspended routes to preserve cash amid an unprecedented shutdown of borders by governments seeking to limit the spread of the COVID-19 pandemic. Before the virus struck, the Canadian industry employed about 46,000 people. The International Air Transport Association says revenue losses for the industry globally will reach US$252-billion, a 40per-cent drop, if government-imposed travel restrictions are in place for three months. The world’s 290 airlines need a combined bailout worth US$200-billion, the Montreal-based trade group says. Mr. Morneau has made several mentions in recent weeks of the need to help the industry but no specific aid package has yet been announced. Airline representatives are expressing growing frustration about the delay. The United States has earmarked roughly US$62-billion for the U.S. air travel sector as part of a US$2-trillion economic rescue bill signed Friday by President Donald Trump. Several other countries have also announced aid for airlines, including Australia (US$430-million) and Hong Kong (US$206-million). “What we’re getting so far is we feel your pain and we’re working on it but we haven’t seen anything,” said John McKenna, president of the Air Transport Association of Canada, which represents about 30 smaller carriers including Harbour Air and Porter Airlines. “We’d be happy to see anything on the horizon at this point.” Airlines, unions and airport authorities say government aid is needed to save jobs, businesses and key transportation links that enable travel and trade. The country’s air transport infrastructure, including airports and airtraffic control, is financed entirely by users through things such as landing fees charged to carriers and airport-improvement fees charged to travellers. Canada’s four largest airports are particularly vulnerable because they have taken on more than $12-billion in debt combined to finance expansion projects over the past decade and depend on airlines using their facilities. Authorities running the airfields are asking the federal government, which owns the facilities, for free rent for one year among other measures to counter the revenue shortage. “The Canadian airline industry will get government support and likely in the form of loan guarantees, possibly some tax relief, too,” former WestJet chief executive Gregg Saretsky said. “Canada usually follows the U.S. on matters such as these, and the U.S. has made firm commitments of support.” Airlines drive travel and tourism in Canada and support more than $90-billion in direct and related economic activity per year, according to estimates. It delivers customers to airports, hotels and home-stay companies such as Airbnb, as well as for cruise lines, restaurants and bars, tour operators, tourist attractions, taxis, trade shows and more. “Airlines employ a lot of people. Politically, it’s difficult to ignore them and accept that they could fail,” said Jacques Roy, a transport management specialist at Montreal’s HEC business school. “We don’t want that to happen and I don’t think that will happen. … That said, there’s a long lineup of people asking for government help right now.”
|
G THE GLOBE AND M AIL
RE P O RT O N BUS I N ES S
Students: Some pupils could be eligible for emergency aid FROM B1
Michael Reale, a graduating student at the Ontario College of Art and Design University in Toronto, had a meeting with a potential employer cancelled at the last minute. “There’s not really a plan at all” right now, he said. “The typical things that one would plan to do [for work] are now super cloudy.” Cassidy Westrop, who’s wrapping up a master’s of architecture at the University of Calgary, is also struggling to find work. “Even previous to this, we all had anxiety about finding jobs,” she said. Students and graduates will be joining the labour market during the worst economic shock that Canada has seen in generations. Bank of Nova Scotia recently projected gross domestic product will plunge at a 28-per-cent annualized rate in the second quarter, far exceeding the worst declines of the Great Recession of 2008-09. Many economists say the jobless rate will surge into double digits. For new graduates, joining the job market during a recession can have lasting consequences. A 2012 study in American Economic Journal: Applied Economics tracked the long-term impact on earnings for Canadian men who graduated in past recessions, finding the cost “is substantial and unequal. Unlucky graduates suffer persistent earnings declines lasting 10 years. They start to work for lower paying employers and then partly recover through a gradual process of mobility toward better firms.” More recently, Royal Bank of Canada published a report that analyzed outcomes for graduates who joined the labour force during and immediately following the 2008-09 downturn. “After the Great Recession, more young, university-educated Canadians found themselves doing jobs that didn’t match their education level – especially compared with those entering the work force in the first part of the 2000s,” the report read. “They were more likely to be working part-time, and not by choice. They were less likely to be working in specialized skilled or managerial roles, and more likely to be working in unskilled occupations.” The early years of one’s career are especially crucial, RBC noted, because that’s when wage increases are typically the largest as workers begin to accumulate experience. Some students may be able to tap into emergency aid that Ottawa recently unveiled and which will provide workers
Mr. Yeaman has also retained his production staff, even if it meant they would be doing maintenance. “I’ve committed with my staff we would not lay anybody off, regardless of how much work we have,” he said. Working with a firefighter, a paramedic and a local physician who serves high-risk patients, MPC designed a headset component for medical face shields. They have been contacted by hospitals in Toronto, Barrie, Orillia and Simcoe County and are in negotiations to supply the federal government. Along the way, the company learned it needed to use material that was compliant with ISO 10993, an international standard for medical devices that ensures the product can come into contact with the human body without adverse reaction. The firm used a 3-D printer to complete a prototype sample and will next need to retool the plant with newly made injection moulds for the mass production. Mr. Yeaman expects the first mould to be ready in four weeks and would produce 5,000 a day. “Getting the product to mass-volume numbers in four weeks is herculean. A product like this would typically take four to six months,” he said. MPC is only making the headset for the face shields. Another company will provide the transparent visors. The final product has to comply with regulatory standards. As newcomers to medical manufacturing, MPC is leaving the red tape to
Second-year University of Ottawa student Grace Gallien is seen on Saturday at her family’s home in Richmond Hill, Ont., where she is finishing the school year. ‘I’m not even sure if I will [go back to work] because I don’t want to put my parents at risk,’ she says. CHRISTOPHER KATSAROV/THE GLOBE AND MAIL
affected by COVID-19 with $2,000 monthly for up to four months. To qualify, workers must have earned at least $5,000 in work income in 2019, or the 12-month period prior to application. In a post to her website, federal cabinet minister Maryam Monsef said students who satisfy the income threshold qualify for the benefit. Government legislation did not say anything about income from scholarships or bursaries. The job market is a concern for returning students as well. Grace Gallien, a second-year student at the University of Ottawa, recently received a notice from her landlord that her rent will be hiked by 23 per cent, to $1,200 monthly from $975, on Aug. 31. (Her building is new and thus not subject to provincial rent-control guidelines.) She wants to remain in the building and is hoping the building’s owner will reconsider the rent hike. “I cannot believe they did this in the middle of this pandemic,” Ms. Gallien said. “One of the very first things I thought of was, ‘I need to get as many hours as I possibly can.’ ” Ms. Gallien is fortunate enough to have a job lined up – but it’s retail work that puts her in direct contact with others, rais-
ing her potential virus exposure. “I’m not even sure if I will [go back to work] because I don’t want to put my parents at risk,” said Ms. Gallien, who’s finishing her school year from her family home in Richmond Hill, Ont. Will Graham, a third-year student at the University of Toronto, planned to return to his jobs from last summer – at a summer camp and restaurant – but that’s been thrown into doubt. “I’m going to try and find work in any way I can,” he said, adding that grocery delivery was an option. One concern is that some students, facing a loss of income, will be forced to add more debt to afford tuition. “I’m hoping student-loan programs can step in for any student who would have had to take on extra debt for the fall,” Dr. Schirle said. “There are opportunities here to offer that as grants rather than loans, where there is need.” For now, Ms. Daboo at UPEI is “living really frugally” to stretch her finances and preparing to defend her thesis on Zoom, the video-conferencing application. “No one could have predicted this could happen,” she said. “No one can predict how long this will go on. So the most we can do is just hold tight and stay hopeful.”
a business partner, Sterling Industries, based in Concord, Ont., which specializes in contract manufacturing and assembling medical devices. “Sterling is already discussing directly with the federal government. So they already have the contacts,” Mr. Yeaman said. “Our key was to apply what we do best and find a collaborative partner for the skills that we don’t necessarily have, thereby making the project fully viable and we know we can get it to market. Because that’s where everybody else is struggling … How do I get it certified? How do I get it to market? What are the distribution channels?” Other companies are undertaking similar efforts. Ontario Premier Doug Ford said last week that Ontario auto parts manufacturers Linamar Corp., Magna International Inc. and Martinrea International Inc. were working together to build ventilators. Another manufacturer, Woodbridge Group, will make N95 respirators. George Courey Inc., a supplier of medical garments based in Laval, Que., is already familiar with the health-care sector but has also had to make adjustments. In normal times, the company keeps a reserve of 75,000 to 100,000 pieces. That supply was gone in two days after the outbreak started. “So think about it, in two days we went through our annual stockpile and since then we’ve sold half a million isolation gowns that were in production. These are abnormal times,” chief executive Jeff Courey said. His company makes isolation and sur-
gical gowns. They are classified according to the risk levels they can handle, from Level 1 to 4. Isolation gowns, which are worn by nurses, patients and visitors in a hospital, are protected up to Level 2, meaning the fabric can resist pressure equivalent to a 20-centimetre water column. Surgical gowns used in operating rooms offer Level 2 to 4 protection. A Level 4 gown should shield from blood or viral penetration and has seamless seals. Completed gowns are inspected over light tables to spot defects in the fabric, then sent out to institutional laundries to be washed and disinfected before use. The fabric for Courey’s Level 4 products comes from Germany and Belgium. The surgical gowns are assembled in Laval. Some of the isolation gowns are made in China, the rest at the Laval facility. Normally the fabric is shipped by sea freight but now they are coming by air, along with other medical gown manufacturers from the rest of the world. “Everybody is trying to airship things out of China. It’s like a battle between nations to see who can get the most stuff out of China as quickly as possible,” Mr. Courey said. A third of his company’s output used to be linen for the hospitality sector, but with hotels and restaurants now dormant, all of his resources are now focused on medical protective equipment. “The ingenuity and creativity of Canadian enterprise is incredible and we’re seeing it especially during this period,” Mr. Courey said.
Redemptions: Wave of activity may be nearing, expert says FROM B1
“It is difficult to offer a meaningful outlook when the precise impact and length of the COVID-19 pandemic remains unknown.” As the coronavirus and its resulting COVID-19 disease continue to disrupt markets, the potential for a “tsunami” of mutual fund redemptions is getting closer, said Martin Pelletier, portfolio manager with Wellington-Altus Private Wealth Counsel Inc. “While ETF [exchange-traded funds] investors have been hitting the panic sell button over the past few weeks, those in mutual funds may not have reacted yet as they likely have an adviser in the middle,” Mr. Pelletier said. “My worry is what investors will do once opening their quarterly statements that are about to be sent out.” Like many of its competitors in Canada, AGF is also facing a decline in its overall assets under management as tumbling markets drive down the value of stocks held in the company’s mutual funds.
MON DAY , MARC H 30, 2020
Airlines FROM B1
Equipment: Production retooling happening at ‘herculean’ rate FROM B1
|
The company reported assets under management of $33-billion as of March 24, a 12-per-cent drop from $37.6-billion for the quarter ending Feb. 29. Market declines are also putting pressure on the revenue streams of mutual fund firms, as lower asset levels reduce the sales commissions paid by investors. Management expense ratios are typically lower on fixed-income funds than equity funds, says Marcos Alvarez, senior vicepresident of global financial institutions at DBRS Morningstar. “Investor behaviour might see many retail clients change their portfolio allocations from equities to fixed-income products,” he said. “This typically results in lower commissions for the fund companies.” Prior to the COVID-19 outbreak in North America, Canada’s mutual fund industry had seen some positive signs in overall redemption levels. The latest numbers released by the Investment Funds Institute of Canada last week reported no net redemptions for the month of February for both mutual funds
and ETFs. Further redemptions by retail investors may not be felt by some fund managers until later in April, when some households under stress because of unemployment may need to liquidate. “A lot of individuals are still processing what the government relief package means for their personal financial situation as well for those with small businesses, and that can have an impact on whether someone decides to sell an investment fund or not right now,” Mr. Alvarez from DBRS Morningstar said. Not all investors have the option to redeem their holdings in all types of investment funds. Several real estate funds have temporarily halted all investor activity in their Canadian real estate funds. The spread of COVID-19 has affected global property markets, making it difficult to value properties. Both Canada Life Assurance Co. and Trez Capital have announced they are no longer allowing investors to redeem, contribute or transfer funds in several of their real estate funds.
Unions representing 40,000 Canadian airline workers met Saturday with Finance Minister Bill Morneau and Transportation Minister Marc Garneau to share their concerns and provide solutions to ensure the sector’s viability. The groups urged the government to consider measures similar to those under the U.S. emergency relief legislation, including that affected workers are to be provided top-up benefits where 80 per cent of wages are guaranteed while health benefit plans are maintained. They also want any government support to be accompanied by tight restrictions on executive compensation and shareholder-friendly policies such as dividend payments and share buybacks. Aid is being sought to keep Canada’s air travel companies afloat and able to meet their financial obligations but also to allow the system to recover after the pandemic passes. The thinking is that if the companies have no cash, a restart of operations will be slow even if there is pentup demand. Canadian airlines have laid off thousands of people, parked planes and suspended routes to preserve cash amid an unprecedented shutdown of borders by governments seeking to limit the spread of the COVID-19 pandemic. Before the virus struck, the Canadian industry employed about 46,000 people. The International Air Transport Association says revenue losses for the industry globally will reach US$252-billion, a 40per-cent drop, if government-imposed travel restrictions are in place for three months. The world’s 290 airlines need a combined bailout worth US$200-billion, the Montreal-based trade group says. Mr. Morneau has made several mentions in recent weeks of the need to help the industry but no specific aid package has yet been announced. Airline representatives are expressing growing frustration about the delay. The United States has earmarked roughly US$62-billion for the U.S. air travel sector as part of a US$2-trillion economic rescue bill signed Friday by President Donald Trump. Several other countries have also announced aid for airlines, including Australia (US$430-million) and Hong Kong (US$206-million). “What we’re getting so far is we feel your pain and we’re working on it but we haven’t seen anything,” said John McKenna, president of the Air Transport Association of Canada, which represents about 30 smaller carriers including Harbour Air and Porter Airlines. “We’d be happy to see anything on the horizon at this point.” Airlines, unions and airport authorities say government aid is needed to save jobs, businesses and key transportation links that enable travel and trade. The country’s air transport infrastructure, including airports and airtraffic control, is financed entirely by users through things such as landing fees charged to carriers and airport-improvement fees charged to travellers. Canada’s four largest airports are particularly vulnerable because they have taken on more than $12-billion in debt combined to finance expansion projects over the past decade and depend on airlines using their facilities. Authorities running the airfields are asking the federal government, which owns the facilities, for free rent for one year among other measures to counter the revenue shortage. “The Canadian airline industry will get government support and likely in the form of loan guarantees, possibly some tax relief, too,” former WestJet chief executive Gregg Saretsky said. “Canada usually follows the U.S. on matters such as these, and the U.S. has made firm commitments of support.” Airlines drive travel and tourism in Canada and support more than $90-billion in direct and related economic activity per year, according to estimates. It delivers customers to airports, hotels and home-stay companies such as Airbnb, as well as for cruise lines, restaurants and bars, tour operators, tourist attractions, taxis, trade shows and more. “Airlines employ a lot of people. Politically, it’s difficult to ignore them and accept that they could fail,” said Jacques Roy, a transport management specialist at Montreal’s HEC business school. “We don’t want that to happen and I don’t think that will happen. … That said, there’s a long lineup of people asking for government help right now.”
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