By Brian Dunn | December 3, 2021 Estimated reading time 3 minutes, 27 seconds.
The days of a one-hour flight between Montreal and Toronto for a quick meeting are over due to Covid-19, according to Philippe Rainville, President and CEO of Aéroports de Montréal (ADM).
Business class travel will continue for commercial and competitive reasons, he said in a presentation to the Canadian Club of Montreal on Nov. 29.
“Virtual meetings have their limits. There is no substitute for face-to-face interaction. Don’t let your competitors take your place because they managed to get a cup of coffee and shake hands.”
During the peak summer travel season, passenger traffic reached 32 percent of the figure recorded during the same period in 2019, double the recovery rate projected at the beginning of the year. ADM expects passenger traffic to reach at least 50 percent in 2022, 70 percent in 2023 and expects to fully recover from the health crisis in 2024. These projections may change due to the Omicron variant, noted Rainville.
Because of the pandemic, ADM has postponed a series of large-scale projects, including the construction of a new terminal.
Returning travelers will be met by unpleasant surprises, said Rainville, recalling that the infrastructures were struggling to meet demand before the arrival of the new coronavirus. ADM needs “a few billion” to rebuild its financial health, he added.
Without going so far as to discuss privatization, a model which has already been evaluated by Ottawa and which is popular in Europe, Rainville believes airports should have the right to welcome private investors, such as pension plan managers. In order to finance its activities during the crisis, ADM raised $400 million in April through a bond issue.
The crisis demonstrates the vulnerability of the current model. A change is the only way to continue to support the airport model.
Rainville pointed out that institutions such as the Caisse de dépôt et placement du Québec and the Ontario Teachers’ Pension Plan have invested in these type of infrastructures elsewhere in the world.
In some cases, the pandemic has had a negative impact on the value of investments. There is no indication that these institutional investors would be open to acquiring interests in airports across the country if the opportunity arises.
