Ottawa airport seeks to regain altitude as airlines restore routes and new carriers enter the market

As Ottawa’s airport slowly emerges from a pit of red ink as it begins to recover from the crushing effects of the pandemic, officials said this week that it “will take some time” for the facility rebuilds its route network and resumes full operation. ability.

As COVID-19 restrictions ease, Ottawa International Airport Authority CEO Mark Laroche on Monday urged residents to book tickets if they want to convince airlines to add more routes to the nation’s capital to their lists.

“We are not satisfied to be a feeder for a major hub airport for decades to come,” he told the airport’s annual general meeting, noting that major U.S. carriers such as American and Delta have removed the capital from their itineraries during the pandemic, with no timetable for their return.

“We hope to see all of our previous routes covered by one airline or another as quickly as possible as the recovery builds.”

Laroche told the virtual rally he sees cause for encouragement as more carriers add Ottawa to their routes or reinstate routes that were suspended earlier in the pandemic.

For example, United restored flights between Ottawa and Washington’s Dulles Airport last fall, while WestJet and charter operators Air Transat and Sunwing began flying snowbirds to hotspots in southern Cuba, from the Dominican Republic, Jamaica and Mexico in November.

Additionally, Canadian low-cost airlines Flair and PAL launched service to and from the capital last year. WestJet’s low-cost subsidiary Swoop entered the local market last week with flights to Edmonton, with plans to add Halifax and Winnipeg to its list of routes to Ottawa later this summer.

“This market is important”

While Edmonton-based Flair is currently at risk of losing its license due to questions about its compliance with national ownership requirements, Laroche said Ottawa has proven itself as a sought-after destination for low-cost carriers.

“Whatever the outcome (of Flair’s license review), this market is important,” he said.

Still, Laroche said the airport continues to navigate an uncertain path into the future as key employers like the federal government as well as private businesses grapple with what going back to the office will look like.

“We cannot ignore the impact these changes (such as hybrid working environments) could have on market demand at YOW,” he said, referring to the airport through his letters of call.

More than 100 flights per day now serve the Ottawa terminal, compared to less than 20 a year ago. The airport has already handled more than double the number of cross-border and international passengers so far in 2022 than it did all of last year.

Laroche said the airport authority is working to continue to build Ottawa’s credentials as a major hub, such as talking to Toronto’s Porter about making the terminal a key part of its expansion plans to more from US and foreign destinations.

He added that the airline was also in talks with Calgary-based low-cost carrier Lynx – which aims to operate 148 flights per week in Canada on more than a dozen routes by July – to list YOW on its list, but said nothing had been finalized.

Additionally, the airport CEO noted that many airlines rely on grants from various levels of government and local economic development agencies to make certain routes financially viable – an option not available to him.

“Unfortunately, we don’t have access to those types of incentives offered by other levels of government,” Laroche said. He said the airport is proposing to partner with the City of Ottawa and Ottawa Tourism to create an “air service development fund” aimed at incentivizing airlines to add more routes to the capital.

Fewer than 1.2 million passengers passed through YOW last year, the airport authority said on Monday, below the 1.4 million who passed through the terminal in 2020 as COVID-related travel restrictions continued. to wreak havoc in the industry.

But airport officials at least had reason to be optimistic when reviewing the terminal’s 2021 financial statements.

Decreasing net losses

The number of domestic travelers fell from just over a million in 2020 to 1.14 million last year, while the airport reduced its net loss by $51.2 million two years ago to $36.7 million in 2021 through a series of cost reduction initiatives.

Meanwhile, the airport generated $56.6 million in revenue last year, nearly 17% more than the $48.6 million it brought in the previous year.

Airport improvement fees charged to passengers – the facility’s main source of revenue – jumped more than 30% to $19.3 million, in part due to fees rising from $28 to $35 $ per passenger imposed last summer.

Most of the airport’s other sources of revenue, including terminal and landing fees as well as concession revenue and parking fees, remained stable or decreased year-on-year to as the total number of YOW passengers decreased. The airport issued $100 million in bonds to cover its losses.

While the airport authority put most major capital projects on hold last year in a bid to cut costs, work at the terminal is picking up speed.

Construction of a new taxiway began on Monday – the first major tarmac infrastructure project at YOW in 25 years. And Laroche said work on the revamped concession area – a plan that was unveiled to much fanfare in 2019 – will begin this summer, with the first outlets, including a new Big Rig restaurant and brewery, expected to open next year.

Meanwhile, he said the airport station on the LRT’s North-South Trillium Line, which received a $6.4 million funding boost from the federal government last summer, is on schedule and the budget and should be completed in the coming weeks.

However, it will take some time for the new station to process passengers. Last week, the city said the light rail extension was unlikely to be completed until next summer – about a year late – due to supply chain bottlenecks and labor shortages. -work.

Laroche also indicated that Groupe Germain remains committed to building a 180-room hotel under the Alt banner that will be connected to the terminal. He gave no updated timeline for construction, which was originally expected to be completed last spring, saying only that the Quebec hotelier is “actively working to resolve challenges” surrounding the project.

“Like all hotels, the pandemic has hit them hard,” Laroche said.

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