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Chorus Aviation Inc. announced the intention of its subsidiary, Jazz Aviation LP, to adopt the Canadian Emergency Wage Subsidy (CEWS). Due to the COVID-19 pandemic, the Air Canada Express flying operations undertaken by Jazz have been reduced by approximately 90 per cent until at least the end of May, and Jazz expects to incur significant revenue losses for the last half of March and the second fiscal quarter. Any near-term recovery in Jazz’s flight operations depends exclusively on the lifting of domestic and trans-border travel restrictions and protocols.
As of March 15, 2020, Jazz’s active workforce in Canada consisted of approximately 5,000 employees. On April 6, 2020, Chorus announced significant measures to reduce costs and bolster its liquidity. This included the difficult decision to reduce Jazz’s workforce by approximately 60 per cent, or 3,000 employees. Subject to the adoption of the CEWS into law, Jazz intends to adopt the CEWS to assist its employees.
“Our employees are amongst the best in the business and play an integral role in supporting Air Canada’s domestic and trans-border operations. I’m particularly pleased that our unionized labour groups support this initiative as we are hopeful the CEWS will provide much needed support to our employees through this difficult period,” stated Randolph deGooyer, president of Jazz.
“I applaud the members of our federal government for tabling this important subsidy to help employers and their employees manage through this very uncertain time,” stated Joe Randell, president and CEO, Chorus. “Every measure must be taken to preserve our strength and resources in order to successfully emerge from this crisis when it abates.”
All areas of the organization are under review with the objective of reducing costs to ensure a strong company that is ready to resume normal operations as soon as possible.
For further information regarding the Capacity Purchase Agreement (‘CPA’) under which Jazz performs flight operations for Air Canada, please refer to Chorus’ Annual Information Form dated Feb. 12, 2020.