Fees to take flight Pricier air travel could be on the horizon By: Temur Durrani Posted: 7:00 PM CDT Wednesday, Sep. 9, 2020

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This article was published 09/09/2020 (2079 days ago), so information in it may no longer be current.

The CEO of Winnipeg Airports Authority says the only way to survive a “pandemic-sized fiasco” is by going back to the basics, but those basics could mean fewer flights at higher costs.

At its annual general meeting held Wednesday at Richardson International Airport, WAA executives laid out their long-term strategy against the eerily quiet backdrop of the departures lounge — emphasizing their survival depends entirely on the return of air traffic.

“Passing costs to passengers will be a complete inevitability,” WAA president and CEO Barry Rempel told the Free Press in an interview. “If things remain unchanged, there’s really no other way.”

“We’re going back to our mission statement — those fundamental ideals of innovation and prudency — so we can come up with solutions about how to keep serving our local community.”

At the meeting, board members explained how they were initially budgeting for an expected increase in revenue this year up to $142 million. As a result of the pandemic, however, the corporation is projecting to meet only about half of that at $75 million in revenue, which finance director Nicole Stefaniuk said might also decrease.

She said mandated lockdowns, border closures and travel restrictions since March “changed everything” for Canada’s aviation industry.

“Unfortunately, our country’s user-pay model for airports — tying our revenue to how many people actually travel — really failed to work in our favour under these circumstances,” said Stefaniuk, adding the company went from about $70 million in capital to under $7 million “in mere months.”

“We clawed through our reserves to pay for things like safety and ongoing expenses,” she said. “Thankfully, we found that we could reduce 25 per cent of our costs.”

But Rempel says more than three-quarters of those costs are fixed items the airport must pay to remain operational, such as utilities, personnel employment and federal taxes like the $201 million paid by the WAA last year.

Currently operating at 14 per cent activity, Winnipeg’s international airport saw its “worst day” when only 56 passengers used its services in July, he said. As restrictions in Manitoba have eased, those numbers have gone up, “but only so slightly and not nearly enough,” he added.

Rempel cited economic outlooks suggesting that even if a vaccine for COVID-19 is developed sometime next year, it’ll likely take until 2025 for airports and other aviation services to return to normal.

As a result, he said Winnipeg’s airport will soon undergo a large restructuring and overhaul of services — including an increase in airliner fees, ending contracts that employ hundreds of local workers and cutting down routes to locations around the world. “It might also mean cheaper tickets that passengers have come to expect just won’t happen anymore,” he said.

“We’re a not-for-profit but that doesn’t mean we’re a not-for-loss. And if no one’s taking flights anywhere, what can we do?”

The WAA is now actively lobbying for the federal government to open international and domestic borders to areas with low COVID-19 case counts that Rempel believes could serve as “safe travel corridors.”

“I know it’s a controversial take on this,” he said. “But I also know that Ottawa isn’t giving us a single cent in direct aid during this time — even when the U.S. is pouring billions to help their aviation industry, so it’s the least our government could do.”

“We’re going above and beyond to follow their rules and regulations, it’s time they start listening.”

temur.durrani@freepress.mb.ca

Twitter: @temurdur