- Jazz Aviation LP, a subsidiary of Chorus Aviation (TSX:CHR), will seek to adopt the Canadian Emergency Wage Subsidy (CEWS)
- The company has reduced its Jazz’s Air Canada Express operations by roughly 90 per cent as a result of COVID-19
- The company’s workforce has lessened by 60 per cent, in an effort to reduce costs and preserve liquidity
- The CEWS will provide employers with a 75 per cent wage subsidy for up to 12 weeks
- Chorus Aviation (CHR) is down 1.55 per cent to C$3.18 per share, with a market cap of 510.96 million
Jazz Aviation LP, a Chorus Aviation subsidiary (TSX:CHR), has said that it will adopt the Canadian Emergency Wage Subsidy (CEWS).
The global aviation industry has been under significant stress since the COVID-19 outbreak began earlier this year. Chorus Aviation is no exception.
The Air Canada Express operations, undertaken by Jazz, have been reduced by roughly 90 per cent. These operations are not likely to resume regular business until at least the end of May.
As such, Jazz is expecting significant revenue losses for the March’s last half, and 2020’s second fiscal quarter.
On April 6, the company announced that it had cut its workforce by around 60 per cent. This represented roughly 3,000 of its original 5,000 employees.
Jazz is looking to Canada’s government for assistance, and will adopt the Canadian Emergency Wage Subsidy (CEWS) when possible.
The CEWS program will provide eligible employers with a 75 per cent wage subsidy for up to 12 weeks. The government will implement the subsidy retroactively from March 15, 2020.
The program will help to prevent further job losses, encourage employers to re-hire previously laid off workers, and help position Canadian companies to quickly resume operations when normal business resumes.
Randolph deGooyer, President of Jazz Aviation LP, acknowledged the vital role that the company’s staff have played in the Canadian aviation industry.
“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. We are hopeful that the CEWS will provide much-needed support to our employees through this difficult period,” he said.
Chorus Aviation also noted that all aspects of the company are currently under review. The company’s goal is to further reduce costs, creating a strong position from which it can resume regular operations as quickly as possible.
Chorus Aviation (CHR) is currently down 1.55 per cent to C$3.18 per share at 3:44pm EST.