Many airlines around the globe are currently struggling due to high jet fuel prices. Airline margins are razor thin under the best of circumstances (if they aren’t negative in the first place), and essentially doubling one of the largest operating expenses isn’t exactly easy to absorb.
So the Canadian government has created a program to help airlines, and it seems relatively fair. However, perhaps what stands out to me most here is WestJet’s stance — the airline is telling the government to stop helping airlines, and not screw over Canadian taxpayers. Say what now?!
In this post:
WestJet blasts Canadian government airline loans
On Monday, June 8, 2026, the Canadian government introduced what’s described as “targeted support to help Canada’s airline sector weather global fuel market volatility.” This primarily consists of two things:
- The Canadian government had already announced that between April 20 and September 7, 2026, the federal excise tax on jet fuel has been removed, reducing the cost by four cents per liter
- On top of that, we’ve seen the launch of the “Liquidity for Airline Sector Resilience” facility, a loan program whereby eligible Canadian airlines experiencing financial pressures due to high jet fuel costs can get up to $150 million in repayable liquidity support, on an as-needed basis
I think the most interesting thing about this is how airlines are responding to this support from the government. In particular, WestJet is tearing into the government here, and I think the whole statement is worth sharing:
WestJet strongly opposes the government’s proposal to issue loans to airlines amid the rising fuel costs. The government faces a choice: continue with costly and market distorting subsidies or build a sustainable future for Canadian aviation.
We’ve seen where this path leads. In 2025 alone, taxpayers lost around $400 million in COVID-related airline loans that were forgiven by the federal government. With this, they have been turned into direct taxpayer subsidies to some airlines.
This time is no different as it is unlikely that they can ever be repaid by the airlines that might accept them, so they will easily result in further hundreds of millions of taxpayer dollars that could have been used for other more meaningful purposes.
The United States, our direct competitor, have deliberately stayed away from bailing out airlines in the spirit of fair and level playing field competition. Their airlines face the same oil prices as ours and Canada should stay away from distorting markets, both within our country and across the border to the US, especially at this sensitive time between our nations.
WestJet has proven a different path is possible to be a viable competitor in the Canadian market. We do not take government loans and instead advocate for a competitive environment where airlines can succeed based on their own strength.
We ask the government to abandon the cycle of corporate charity and focus on long-term stability by fixing the overdue foundational cost issues that hold our entire industry back.
An airline looking out for taxpayers, and opposing corporate charity? Say what now? Is this WestJet’s latest April Fools prank? 😉
Why is WestJet looking out for taxpayers, exactly?
In fairness, it can be hard for governments to strike the right balance when it comes to providing support to airlines during tough times. The goal is to preserve competition without distorting the competitive landscape.
So that’s why I was super opposed to the concept we saw in the United States, where the government wanted to take over Spirit Airlines, as it would totally distort competition. However, in theory, the concept of giving loans to airlines in as fair of a way as possible strikes me as being less unreasonable.
Obviously airlines all have different financial strength and market positions, so they won’t all have the same perspective when it comes to what kind of support is appropriate. However, the extent to which WestJet is condemning the government is quite something here.
It seems pretty clear what’s going on here — WestJet thinks that at least one of its competitors may be on the verge of going out of business and can’t weather the storm. You have to look no further than the airlines that are thanking the government for the support, and saying they’re reviewing the loan offers — Air Transat and Porter Airlines.
Now, Air Transat has actually had a bit of a turnaround, and turned a profit in 2025, so I don’t assume that’s the primary target here. Instead, it’s Porter that’s the mystery — the airline isn’t publicly traded, so it’s hard to know the company’s financial situation. However, let me just say that there’s a lot of skepticism out there about the profitability of the company’s flying, especially given the pace at which it has grown.
I get WestJet’s perspective — while WestJet also isn’t publicly traded, the company’s management team has done a stellar job carving out a strategy that works. And their lack of desire for any government support even during tough times makes it clear that the airline can weather this storm.
I will say, the one thing that makes the Canadian government’s plan a bit unfair is that a $150 million loan will go a lot further for an airline like Porter than an airline like Air Canada, given their vastly different sizes.
Bottom line
The Canadian government is trying to support airlines when it comes to the high cost of jet fuel. In addition to pausing the federal excise tax on jet fuel, the government is also offering up to $150 million in loans to offset higher jet fuel costs.
What’s interesting is how strongly WestJet opposes this — the airline claims this is a direct taxpayer subsidy to airlines, and it will result in hundreds of millions in taxpayer dollars being wasted. Admittedly airlines will have different takes on this, since not everyone has the same financial strength. However, this has to be one of the firmest oppositions we’ve seen from an airline when it comes to government support.
I certainly commend airlines that have been able to build their businesses to the point that they actually plan for bad times, and can sustain operations for an extended period of time, rather than relying on government support the second things go wrong.
What do you make of Canada’s program to support airlines, and WestJet’s response?
The Canadian airline industry is still rather fractured for a market as small as Canada's is; WestJet would love to consolidate its strength by the failure of a couple of those smaller airlines - its focus is not Air Canada.
and a whole lot of other countries around the world are going to be doing similar things in the coming months as the mess in the Middle East drags on. The good news is that...
The Canadian airline industry is still rather fractured for a market as small as Canada's is; WestJet would love to consolidate its strength by the failure of a couple of those smaller airlines - its focus is not Air Canada.
and a whole lot of other countries around the world are going to be doing similar things in the coming months as the mess in the Middle East drags on. The good news is that global economies are not on the verge of collapse due to high fuel prices or even the rapid rise of them and there has been a lot of fuel demand worldwide that has been eliminated as a result of the war - which should make environmentalists happy.
Major economies will figure out how to live with high fuel prices; they aren't the highest the world has ever seen in historic terms but make a lot of transportation unprofitable.
and as much as we love to talk about airlines here, diesel fuel is as high as jet fuel in many parts of the world and a far higher percentage of economies are dependent on diesel fuel rather than jet fuel.
specific to aviation, a whole lot of capacity will be coming out of airline networks in the fall and winter.
Canada will likely wish to sanction WestJet for expressing a point of view .
Watch out, WestJet. The RCMP’s elite tactical moose unit is rolling out, and those maple-syrup darts are locked and loaded. /s
It's a repayable loan, not a subsidy (although Westjet is suggesting that the recipients would not be able to repay). It is conditioned on limits on executive compensation and shareholder distributions - maybe that's why Westjet isn't interested in partaking.
To me, the tone of that letter really goes against their friendly and caring brand. I'm not sure who the intended audience is. If they are marketing to people who want to travel, surely...
It's a repayable loan, not a subsidy (although Westjet is suggesting that the recipients would not be able to repay). It is conditioned on limits on executive compensation and shareholder distributions - maybe that's why Westjet isn't interested in partaking.
To me, the tone of that letter really goes against their friendly and caring brand. I'm not sure who the intended audience is. If they are marketing to people who want to travel, surely those people would prefer the lower prices when there are more competing airlines. If they are targeting people who don't travel a lot and don't what the government to spend in this way, what does Westjet gain if those people aren't travelling?
I've never experienced any friendliness or care from any brand. Although some brands happen to have some friendly and caring staff.
I haven't flown either yet but I constantly hear from people I know many good things about Porter and many bad things about Air Transat. It'd be...
I haven't flown either yet but I constantly hear from people I know many good things about Porter and many bad things about Air Transat. It'd be sad to see Porter going belly up as they have really created new routes that the two big airlines would never consider :(
Just wanna echo praise for Porter. I've flown them mostly between NYC and Toronto. It's an awesome smaller airline. If going to/from the city, YTZ is far better than YYZ. PD has all smaller aircraft, so no middle seats; specifically, their newer E2s are impressive. (Also, kinda silly, but their cute racoon mascot is worth signing up for their emails, just to see the creative clip-art!)
Yeah, the racoon has friends and everything. They're all lovely.
Mr. Porter and his friends are the best! His various outfits and accoutrements are hilarious.
WestJet appears to have some integrity , unlike the rest of the airlines .
Oh, please do share your definition of "integrity"... I'll wait.
WestJet's sudden pivot to fiscal conservatism is just a convenient excuse to protect their own turf.
1990 ... Honesty and uprightness , as was Fiorello LaGuardia .
Mayor LaGuardia built public infrastructure to connect people; WestJet is just trying to clear the runway of its rivals.
It is estimated that the Canadian commercial airlines industry employs somewhere between 800,000 and one million people. What this effectively means is that approximately 1 in 50 people are reliant upon the Canadian aviation industry.
Due to the population size in comparison to the land mass of Canada, for the majority of the population, air travel is vitally important. The Canadian government could be said to be well aware of the importance of loans...
It is estimated that the Canadian commercial airlines industry employs somewhere between 800,000 and one million people. What this effectively means is that approximately 1 in 50 people are reliant upon the Canadian aviation industry.
Due to the population size in comparison to the land mass of Canada, for the majority of the population, air travel is vitally important. The Canadian government could be said to be well aware of the importance of loans to sustain both the airline industry and the public sector too.
And to sustain the excessive airline executive compensation .
Alert, I am not certain that I understood your comment, would you add some meat to the ‘snack’?
What you also forget is that WestJet is now deeply entrenched in YYC. Which is the oil capital of Canada, likely the execs there are unhappy.
And, apparently, some US far-wing oligarchs are still pumping millions into secessionist propaganda over there... real Albertans and all Canadians should reject that astroturf'd nonsense.
According to WestJet, offering loans is some sort of ‘communism,’ now? Buncha jokers…
If only...