Air Canada has sold and will subsequently lease back more than a third of its fleet of Boeing 737 MAX aircraft weeks before the controversial aircraft is expected to start returning to service. The airline was flying 24 MAXes before the type was grounded in early 2019 following two crashes that killed 346 people. The cash-strapped carrier raised $500 million by selling and leasing back nine of those planes. It cut deals with Jackson Square Aviation and Avolon Aerospace Leasing. The move freed up cash but it also reduces its asset base which may affect how much it pays for long-term financing in the future.
In the meantime, the deals give Air Canada some breathing room as it tries to stay afloat with drastic cuts to its business caused by the COVID 19 pandemic. This summer the airline reported that it was burning $19 million in cash a day to keep the lights on. Other Canadian airlines are in similar positions but may not have the resources to raise cash in this way. The federal government has so far not announced any sector-specific aid for airlines but has hinted at least some help may be on the way.