Canada Offers To Help Airlines Amid Jet Fuel Spike, And WestJet Is Furious

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?!

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?