Air Canada to refund some fares in new deal with Ottawa

Photo by M42 at Morguefile.com

Did you have to cancel a flight with Air Canada at the beginning of the pandemic? You likely were not happy when you did not get a refund, but now, you might.

Air Canada and the federal government have reached a deal to provide the carrier with almost $5.9-billion in loans and financial equity. The support is through the Large Employer Financing Facility Program.

Like all air carriers, Air Canada has been hard hit by a plummet in air travel over the past year.

“Air traffic ground to a virtual halt in Canada and internationally,” said Air Canada’s President and CEO, Michael Rousseau.

The money comes with strings attached. In return for the financing agreement, Air Canada will have to refund customers the cost of their non-refundable tickets, maintain its workforce, and return to service in regional markets.

Starting Tuesday, eligible customers who bought a non-refundable fare but did not travel since February 2020 will have the option to get their money back. Travel agencies will not have to give back their commissions on those tickets. The agreement with Ottawa provides the air carrier with $1.4-billion for refunds.

“As vaccine deployments ramp up, we continue to work with the Government of Canada on the evolution of safe and science-based test and quarantine relief measures with a few to safely restarting our sector,” continued Rousseau.

The loans are fully repayable, and Air Canada will only draw down cash and equity investment as required.