Air Canada bailout welcome news for Labrador, Gander air industries

Following the federal government's announcement of a $5.4-billion bailout for Air Canada, people inNewfoundland and Labrador's beleaguered air travel sector are hoping the moneyhelps the industry take off.

Labrador MP Yvonne Jones saysthe airline's commitment to bringing back service to areas like Labrador will mean restoring a lifeline that Northern communities need.

"Air service in Labrador is not a privilege; it's an essential," she said. "It's what brings food, supplies, medical equipment, personnel, everything in and out of our communities."

The relief package announced Tuesday for the nation's biggest airline will come in the form of low-interest loans and a $500-million equity stake in the airline.

Thepackage comes with conditions, includinga commitment to retain jobs, refund would-be travelers for cancellations due to the COVID-19 pandemic, and reinstate regional air services. Jones said with this deal, Air Canada expects to be up and running in Happy Valley-Goose Bay by June 1.

While there isn't a deadline yet forwhen service will be returned to Wabush, Jones said Air Canada has agreed to work with other carriers to replace servicesthey cancelled, including to that community.

Jones saidthe idea of the government taking over a large portion of the airline is an opportunity for both the federal and provincial governments to get involved in providing what she says is an essential service.

"If we cannot afford that service going forward, and the airlines can't afford to provide that service, then there's a role here for both the provincial and the federal government to step up," said Jones.

"Essential air services are needed right across Canada's North. They need to be affordable, they need to be available, and it's the only transportation connection that people have."

Welcome news for embattled airport

While service cuts have hitLabrador particularly hard, the reinstating of routes is also good news for Newfoundland, says the CEO of the Gander International Airport Authority.

Reg Wrightsaid he was happy to see a focus on regional routes included in the negotiations.

"When you're dealing with taxpayer money, the real interest that the federal government would have in this issue is that national air services be solvent, but also in the nation-building exercise that air service is provided in Canada," said Wright.

"It's really not just about enriching the value of Air Canada; it's about the connections that hold us together as a country."

Coming aftera year of doom and gloom, Wright said, the bailout is welcome news alongside PAL Airlines and other providers committing to new, broader services.

"It's good to see WestJet committing to coming back to Gander. It's good to see Sunwing looking at a summer schedule," Wright said.

"But the success of it is really going to be dependent on the extent to which quarantine has been lifted for the summer, where we are with the bubble, and that has a direct bearing on demand."

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