Air Canada rivals would welcome aid

MONTREAL — Canada is facing industry calls to extend financial aid to smaller airlines, after offering a $5.9-billion lifeline to Air Canada, as new COVID-19 variants cast early clouds ahead of the vital summer travel season.

The timing of Monday's deal, which saw the Canadian government take a six per cent equity stake in Air Canada, was partly designed to secure "access to air travel when it returns," as the country's vaccine rollout ramps up, a source said.

But with the spread of new variants threatening to overtake the pace of vaccination, early hopes for a relaxation of strict travel requirements are fading.

Fears of a delayed recovery, along with the government

deal, has upset the "level playing field" for air service, with the airline's smaller rivals calling on the government for financial support.

"We want everyone to have access to the same programs," said John Mckenna, chief executive of the Air Transport Association of Canada, which represents smaller carriers.

On Wednesday, Air Canada joined rival Westjet Airlines in extending a three-month suspension of sun-destination flights to the Caribbean and Mexico originally slated to end April 30, reflecting the government's current warnings against international travel.

The planned April reopening of a bubble in Atlantic Canada that would allow travel among the region's four provinces without the need to selfisolate was postponed until at least May 3. Westjet said its previously-planned schedule for the region remains unchanged.

Canada's Liberal government has said talks with carriers like Onex Corp.— owned Westjet are ongoing.

"We hope that the other agreements come as soon as possible," the source familiar with the talks said, adding that "different airlines have different needs."

Westjet spokeswoman Morgan Bell said the airline is optimistic a successful vaccine rollout will support summer travel and expects "government policy will transition" with mounting jabs.

Canada has a mandate that its citizens and residents arriving from abroad self-isolate for 14 days. Health Canada advised residents to avoid travel outside the country "for the foreseeable future."

Calgary-based Westjet has asked the government to end an order requiring international arrivals to quarantine for up to three days in a hotel in favour of COVID-19 testing.