While Castlegar Council remains entirely optimistic about plans for a gaming centre, new landing lights and the potential for commercial operations on the airport lands, it seems that the rest of Canada and the world is waiting to see which way things will turn as this recession tosses its victims about like a tornado – particularly the airline industry.
Analysts have speculated that Air Canada could be headed for bankruptcy again hobbled by a C$2.85 billion pension shortfall, tough economic conditions and stiff competition. The airline has said it is working to avoid a bankruptcy filing.
Calin Rovinescu, Air Canada’s chief executive, has made another desperate pitch to the airline’s unions to support an immediate moratorium on its pension obligations before he takes the plan to Ottawa.
“This is real-time,” Rovinescu said on a video. “We need this right now.”
Air Canada’s pension solvency deficit grew to about $2.9 billion last year, up from $1.2 billion in the previous year. This means the carrier is currently on the hook for about $650 million in funding requirements.
Rovinescu said that amount is unrealistic after the airline posted a $400-million loss in the first quarter and there is no end to the recession in sight.
Air Canada (AC.A-T1.350.1310.66%) has reached an agreement with one of its major credit card processors that will drop the level of unrestricted cash the airline is expected to have on hand to $800-million.
Air Canada says the move will help it maintain financial stability as the cash-strapped airline deals with weak economic conditions.
In a grimly pessimistic set of annual results, Heathrow airport’s largest airline declined to offer investors new guidance for this year because of the dire state of the airline market.
Willie Walsh, BA’s chief executive, confirmed that no upturn was in sight. “I don’t think the economic environment will improve. We don’t see any signs of recovery, nothing, right across the globe in all the markets we operate in,” he told Guardian.co.uk.
If it is possible to foresee the future, I’d say that we will be traveling less, particularly energy intensive and expensive. Spending any money on airport expansions or anything related is a short term decision and will be looked upon with scorn and derision in the future.