WestJet blames Ottawa as it cuts capacity, reduces staff by 1,000

WestJet Airlines says the federal government’s “incoherent and inconsistent” COVID-19 testing policies have forced it to cut capacity and reduce its staff by 1,000.

The Calgary-based airline said in a statement Friday that it “continues to face volatile demand and instability in the face of continuing federal government travel advisories and restrictions.”

The airline will remove 30 per cent of its current capacity from its schedule in February and March, representing an overall reduction of 80 per cent compared to the same time last year.

As a result of the capacity cuts, WestJet said approximately 1,000 employees will be either furloughed, temporarily laid off, put on unpaid leave or see their hours reduced. A hiring freeze will also be put in place.

The cuts come two days after the federal government issued an interim order requiring all travellers coming to Canada to provide proof of a negative COVID-19 test taken within 72-hours of departure, a move that was initially announced last month.

“Immediately following the federal government's inbound testing announcement on December 31, and with the continuation of the 14-day quarantine, we saw significant reductions in new bookings and unprecedented cancellations," WestJet CEO Ed Sims said in a statement, calling Ottawa’s policy “incoherent and inconsistent.”

"We have advocated over the past 10 months for a coordinated testing regime on Canadian soil, but this hasty new measure is causing Canadian travellers unnecessary stress and confusion and may make travel unaffordable, unfeasible and inaccessible for Canadians for years to come. Regrettably, this new policy leaves us with no other option but to again place a large number of our employees on leave, while impacting the pay of others.”

The new policy came into effect on Wednesday. WestJet, along with Air Canada, Air Transat, Sunwing, the National Airlines Council of Canada and the International Air Transportation Association, had unsuccessfully lobbied Ottawa to grant an 11-day extension to implement the rules.

All international travellers will still have to follow the federal government’s 14-day mandatory quarantine, which has been in place since March, even if they receive a negative test result before departure and upon arrival.

Canada’s airline industry has been calling on the federal government to provide a financial relief package for the battered sector since the pandemic struck in March. Ottawa has said it will provide an aid package but only if airlines provide refunds to passengers whose flights were cancelled as a result of COVID-19.

When asked about the status of a financial aid package for the airline industry, Prime Minister Justin Trudeau said Friday in a press conference that the government has invested close to $1.5 billion in support for airline companies through the Canada Emergency Wage Subsidy and other programs.

“We’ve made it very clear that we expect people to be reimbursed, we expect regional routes to be protected, we expect certain things from the airline industry,” Trudeau said.

“Those discussions about how we’re going to make sure that people are protected as we offer supports are continuing.”

The COVID-19 pandemic, subsequent border closures, and quarantine restrictions have led to cratered demand across the global airline industry.

WestJet is suspending 11 routes, largely between western Canada and the United States. The suspended routes include Edmonton to Puerto Vallarta and Phoenix; Vancouver to Cancun, Phoenix, Puerto Vallarta, Cabo, Los Angeles, and Palm Springs; and Calgary to Las Vegas and Orlando.

The airline also announced the seasonal suspension of 13 international destinations, including:

• Antigua

• Aruba

• Barbados

• Bonaire

• Huatulco, Ixtapa and Mazatlán, Mexico

• London (Gatwick), United Kingdom

• Nassau, Bahamas

• Port of Spain, Trinidad and Tobago

• San Jose, Costa Rica

• Tampa, Fla.

• Turks and Caicos

WestJet said Friday that it will now operate approximately 150 daily departures, a level that the airline has not seen since June 2001. The company’s international market capacity is down 93 per cent year over year.

Alicja Siekierska is a senior reporter at Yahoo Finance Canada. Follow her on Twitter @alicjawithaj.

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