Air Canada faces huge uncertainty as government aid emerges

The long-anticipated financial aid package for Air Canada from Canada has materialised just as Canada is enduring a second wave of COVID-19 infections and more domestic lockdowns are emerging.

Even before the latest wave of infections, Canada’s air traffic recovery was stalled due to the government’s tight travel restrictions. Vaccination progress is slow, and Canada’s rate of total infections is among the lowest in the world. 

Now the airline must decide if the stipulations attached to the nearly CAD6 billion package, including a 6% ownership stake by the government, are worth having an extra layer of liquidity in what continues to be a highly uncertain environment.