Canadian travellers are facing increased airport fees, report says. Here’s why


By Sammy Hudes The Canadian Press Posted March 6, 2023 1:24 pm 4:29 What proposed air passenger bill of rights changes mean for Canadians Travel expert and Goose Insurance co-founder Omar Kaywan joins Global News Calgary to discuss the new tools air passengers may soon have following 2022’s travel disruptions. Kaywan also addresses some common travel myths – Feb 4, 2023 Canadian travellers are facing increased airport fees after the COVID-19 pandemic grounded revenues and led to more debt for airports across the country. COVID-19 disrupted the airport sector’s “relatively stable” and resilient business model, as Canadian airports have added around $3.2 billion in combined debt, DBRS Morningstar said in an analysis note on Monday.Unlike American airports, which received significant financial aid during the height of the pandemic, Canadian government subsidies mostly targeted airlines rather than airport authorities, according to the credit rating agency.The latter only benefited from “modest” support, such as Transport Canada’s Airport Critical Infrastructure Program, launched in May 2021, which provides $571.2 million over five years. Story continues below advertisement “The Canadian government has not demonstrated a willingness, or perceived a material need, to provide significant financial support to Canadian airports,” the agency stated.During the pandemic, Toronto Pearson International Airport twice increased its airport improvement fee by $5 to $35 for departing passengers. That followed losses of $383 million and $350 million in 2020 and 2021, respectively. Trending Now That fee similarly rose at Montreal’s Pierre Elliott Trudeau International Airport from $30 to $35 in 2021. The Regina Airport Authority plans to hike airport improvement fees by $10 per departing passenger to $30 on April 1.Airports’ operating costs and capital expenditures are also on the rise due to inflation, per the agency. Tariff increases have become “necessary” as airports look to restart capital projects at higher costs after many were paused during the pandemic. 0:32 Trudeau says Canada will work with U.S. to protect North American air space after Biden announces new rules “The elevated pressure for Canadian airports to raise fees reflects the combined effect of the increased leverage during the pandemic and the unsubsidized and not-for-profit nature of the Canadian airport business model,” the analysis note stated. Story continues below advertisement “The longer it takes an airport to grow/rebuild traffic and match the designed capacity of facilities, which were developed with borrowed money, the longer such pressure will persist.”The agency said it does not expect a shift in competitiveness between Canadian and U.S. airports to have any material impact on the ratings of major Canadian airports, which remain largely protected by their monopolistic status and resilient demand from consumers. &copy 2023 The Canadian Press Sponsored content Flyers

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