Ottawa to announce multibillion-dollar relief package for Air Canada in exchange of Passenger refunds !

Past Speculations  -  "The Canada's federal government may soon announce support package of  around  $9 billion for the pandemic - battered aviation industry"

• Pay Passenger refunds to avail the Financial support package.
• Aviation Support package is not bail out -  it will be a loan.
• Creation of pool of funds for the passenger refunds.
• Airlines to Restore and retain regional routes.
• Airlines to Protect the aviation jobs.
• Airline sector has already received $1.7 billion through the federal wage subsidy program since the beginning of the pandemic.

The Canadian federal government has inched closer to an agreement with Air Canada for a financial support in exchange for refunds for customers who faced flights cancellations last year because of the COVID-19 pandemic.

Air Canada For sure is not getting a bail out , rather it will be a  loan , details of which will be announced later in the evening (Monday).

The government also has a plan to create a pool of funds that will allow passengers who saw flights cancelled with other airlines last year to receive refunds as well.

Michael Sabia is taking the lead on the Negotiations !

Michael Sabia, the veteran corporate executive recently recruited as deputy minister of finance, has finalized a package, according to three sources with knowledge of the negotiations.

Equity stakes have been ruled out, so the rescue package is expected to be a mix of low-cost loans and wage subsidies, and to come with restrictions related to executive compensation.

Current Aircraft orders will not be cancelled !

Two of the sources said the package would ensure key regional routes would be maintained and that current orders for aircraft would not be cancelled if it were to affect jobs in Canada. It remains unclear if equipment purchases remain part of the package.

One source said the government will announce a fund for airlines to draw from to refund customers for flights cancelled because of the pandemic. Air Canada has $2.3-billion in prepaid fares, including cancelled flights, according to company documents.

WestJet not part of the Package !

Calgary-based WestJet is not included in the package being announced on Monday. Parts of the package are expected to be available to other airlines as well.

Mr. Sabia and the industry were in talks for months, with all the participants signing non-disclosure agreements as Finance Department officials dug deep into the financial records of airlines both big and small.

From the package, Ottawa has also earmarked around $207-million to help smaller airports adjust to the upheaval in the industry, which could see smaller airlines take over remote routes.