Passengers at Ottawa’s airport should be prepared to shell out more in fees once COVID-19 travel restrictions are eased and people start flying again.
Speaking during the airport authority’s annual general meeting on Thursday afternoon, CEO Mark Laroche said it could be three to five years before passenger volumes at YOW return to pre-pandemic levels. As a result, he said, the non-profit facility will likely have to hike levies such as airport improvement, terminal and landing fees – which account for more than two-thirds of its revenues – to help make up the difference.
“We simply will not be able to sustain our critical infrastructure without more funds coming in,” he said. “There’s going to be a new normal. The (travel) habits of people have changed.”
Laroche’s remarks came following a grim videoconference in which the airport boss sat at a desk with a virtually deserted terminal as a backdrop to deliver an update on operations at YOW, where passenger traffic has plummeted 98 per cent since the pandemic began.
While more domestic flights are gradually being put back on the schedule, Laroche said the airport now expects only about 2.5 million passengers to pass through its gates in 2020, down from its original forecast of 5.2 million before COVID-19 hit.
“Our airline partners have been devastated,” he said.
NYC flights suspended
Ottawa was averaging more than 400,000 travellers a month in January and February, but last month saw a total of fewer than 9,000 passengers as domestic traffic dove sharply and international arrivals and departures dried up completely. Transborder traffic to the U.S. was down to just a few hundred passengers in April and May.
Delta Air Lines suspended its daily flights between New York City’s LaGuardia Airport and YOW in late March in the wake of government-imposed travel restrictions to combat the spread of the novel coronavirus. Ottawa is still served by a couple of daily flights to U.S. destinations, including Detroit and Philadelphia.
In response to a question from the audience, Laroche said he hopes direct flights to LaGuardia will resume once demand warrants them – whether it’s via Delta or its new Canadian joint venture partner, WestJet.
“Any loss of flight is not something that we like,” he said.
Overall, the airport took in $138 million in revenues in 2019, about the same as a year earlier. Expenses totalled $102 million, and the airport posted net earnings of $5.1 million.
With COVID-19 hammering the airline industry, the Ottawa airport is not expected to come anywhere close to those revenue numbers in 2020. Last month, Laroche told OBJ the facility is “losing money every day” and might have to borrow up to $150 million over the next two years just to cover its operating expenses.
The airport has also been forced to cut staff and put more than $35 million in planned capital expenditures on hold in an effort to rein in costs, Laroche said Thursday.