Air Canada said today that it is indefinitely suspending service on 30 domestic regional routes and closing eight stations at regional airports in Canada.
These structural changes to Air Canada's domestic regional network are being made as a result of continuing weak demand for both business and leisure travel due to COVID-19 and provincial and federal government-imposed travel restrictions and border closures, which are diminishing prospects for a near-to-mid-term recovery.
As the company has previously reported, Air Canada expects the industry's recovery will take a minimum of three years. As a consequence, other changes to its network and schedule, as well as further service suspensions, will be considered over the coming weeks as the airline takes steps to decisively reduce its overall cost structure and cash burn rate.
Of the 30 regional routes Air Canada is suspending 21 are operated by Jazz Aviation on a capacity purchase agreement with a term extending through the end of 2035.
Under the CPA, Air Canada purchases substantially all of Jazz’s fleet capacity and pays certain fixed margin fees, performance incentives and compensation for operating costs (including aircraft lease rents) and makes all decisions with respect to marketing that capacity.
In a statement Chorus Aviation, owners of Jazz’s, said the carrier’s compensation does not vary with flight activity and remained unchanged with Air Canada’s announcement.
“The COVID-19 crisis and provincial and federal government-imposed travel restrictions and border closures are having a significant negative effect on passenger demand for Canadian air travel,” said Joe Randell, chief executive of Chorus. “I am saddened by the impact today’s announcement will have on our employees, suppliers and the affected communities, but respect and understand the difficult choice our partner, Air Canada, has had to make.”