Air Canada to offer refunds to passengers as part of potential bailout package: Source

Air Canada to offer refunds to passengers as part of potential bailout package-Milenio Stadium-Canada
Air Canada is one of the biggest companies in the country in one of the hardest hit industries by COVID-19. The airline tapped into hundreds of millions of dollars in government support to help pay salaries. (Darryl Dyck/The Canadian Press)

Air Canada has agreed to offer refunds to passengers who had their travel plans cancelled because of the pandemic as part of a potential bailout package from the federal government, says a source with knowledge of the negotiations. 

Air Canada cutting about 1,700 jobs as it reduces capacity

CBC News agreed not to name the source because they are not permitted to speak publicly about the talks.

Unifor president Jerry Dias also told CBC News he has spoken with both Air Canada and the federal government officials negotiating with the airline who confirmed that Air Canada agreed “a long time ago” to offer refunds in exchange for a bailout.

“The precondition for receiving a federal aid package is that Air Canada and the other airlines will have to repay customers. I know that Air Canada has absolutely agreed to do that,” Dias told the Toronto Star, which first reported the story earlier Wednesday.

Air Canada told CBC News that talks with the federal government over a bailout package for the airline are ongoing and it has nothing to add.

In its Feb.12 earnings report, the airline said it had just closed the “book on the bleakest year in the history of commercial aviation.”

A federal government official speaking on background told CBC News Tuesday that Canadian airlines have so far received more than $1.7 billion in financial assistance through the Canada emergency wage subsidy (CEWS).

The official said any further help will require airlines to offer refunds to passengers for cancelled flights, reinstate regional routes in Canada, and protect jobs across the airline sector.

“We continue to emphasize this in our ongoing conversations with the airlines,” the official told CBC News. “In a country as vast as Canada, it’s essential we maintain connections between people and our communities. Maintaining a vibrant, competitive Canadian air sector and Canadian airlines is a priority.”

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