April 12th, Air Canada local time announced that it had reached an agreement with the federal government of Canada, which would provide Air Canada with a liquidity of $5,879 billion through a mixture of low-interest loans and equity financing. Canadian Deputy Prime Minister and Finance Minister Christia Freeland confirmed the news at a press conference that night.
In exchange, Air Canada agreed to refund customers who booked or purchased tickets on Air Canada but were unable to take flights since the epidemic and flight cancellation since February last year. Air Canada also agreed to resume almost all of the current regional flights suspended due to the epidemic, agreeing to restrict management to the company.
Layers of compensation, stock repurchase, and dividends to shareholders are restricted. In addition, Air Canada promises not to lay off staff, maintain the number of existing employees, abide by collective bargaining agreements with trade unions, and continue to pay employees’ pensions, etc. Air Canada currently has 14,859 employees, and the total number of employees of the company before March last year exceeded 30,000.
Air Canada is Canada’s largest airline and the backbone of the Canadian aviation industry. After obtaining the liquidity provided by the government, Air Canada can pay for orders for 33 Airbus A220 and 40 Boeing 737MAX aircraft.