Air Canada commits to moving forward with purchases of A220 and 737 Max
Air Canada plans to complete the acquisition of 33 Airbus A220s and 40 Boeing 737 Maxs with a C $ 5.879 billion ($ 4.682 billion) funding commitment from the Government of Canada under its funding facility program Emergency for Large Employers (LEEFF), the airline said Monday.
The package provides for fully repayable loans that Air Canada would draw down only when needed, as well as an investment in shares. This includes a government purchase of C $ 500 million of shares in the airline, which means that Ottawa will once again own part of the Canadian national carrier.
“The additional liquidity program that we are announcing today achieves several aligned objectives as it provides an important layer of assurance for Air Canada, it allows us to better resolve non-refundable ticket refunds to customers, to maintain our workforce. ‘work and re-enter regional markets, ”he added. said Michael Rousseau, CEO of Air Canada. “Most importantly, this program provides additional liquidity, if needed, to rebuild our business for the benefit of all stakeholders and to continue to make a significant contribution to the Canadian economy through its recovery and for the long term.
In return for government assistance, Air Canada has agreed to comply with provisions relating to reimbursements to customers, service to regional communities, restrictions on the use of funds provided, employment and capital expenditures.
Under the agreement, Air Canada must maintain employment levels not lower than those in effect on April 1. As of April 13, the airline began offering the option of a refund in the original form of payment to eligible customers who purchased non-refundable fares for the month of February. 1, 2020 or later, but has not traveled due to Covid-19. It has also pledged to resume service or “access” to the Air Canada network for almost all regional communities that have seen service suspended due to Covid-19 through direct services or new agreements. interline with third-party regional carriers. Finally, the airline has agreed to curb certain expenses and restrict dividends, share buybacks and executive compensation.