Canada’s Treq receives C$3.5mn state loan for launch

Nascent low-cost carrier Treq has received a new shot in the arm with a CAD3.5 million Canadian dollar (USD2.7 million) repayable state loan to pay for its launch, according to a disclosure by the Canadian Federal Government.

The virtual airline, which had shelved its planned debut in May 2021, would use the loan to pay for the operating costs of its launch, the acquisition of equipment, a marketing strategy, and to employ 60 staff, Ottawa revealed in a statement. As reported earlier this year, Treq intended to acquire a fleet of five DHC-8-Q400s and raise capital through crowdfunding.

Treq said the funding was “an important vote of confidence in our cooperative project”. “Despite certain delays imposed by the health context, our project becomes more concrete every week and partnerships are concluded which will strengthen our operations in due course,” the company said in a statement. “The entire airline industry is awaiting an important announcement from the Quebec Ministry of Transport regarding its plan for the future of regional air transport. As a future major player in regional development in Quebec, our team is impatiently awaiting this plan, hoping that it will improve and ensure the sustainability of air services in Quebec,” it said. “It makes no sense that it still costs more today to travel between two regions of Quebec than between Quebec and the rest of the world.”

A government statement disclosed Treq’s latest funding news detailing the allocation of nearly CAD39 million (USD31.1 million) to the Québécois aviation sector through Canada Economic Development for Quebec Regions (CED) to support regional air transport.

Of this amount, Ottawa has made CAD16.8 million Canadian dollars (USD13.4 million) in repayable loans available to four Québécois airlines, including Pascan Aviation (P6, Montréal St. Hubert), Air Inuit (3H, Kuujjuaq), Air Creebec (YN, Val d’Or), and Treq.

Pascan Aviation will receive a repayable loan of CAD8.8 million (USD7 million) to pay for costs associated with adding regional flights, salaries, maintenance services, sundries, and the acquisition of equipment and the upgrading of computer systems. The project is expected to lead to the creation of 15 jobs.

Air Inuit’s repayable loan of CAD4.4 million (USD3.5 million) will go towards the acquisition and installation of aircraft and aircraft maintenance, baggage handling, and aircraft de‑icing equipment, plus computer gear.

Air Creebec’s CAD37,500 (USD29,500) repayable loan will be used for the installation of computer equipment as part of a project to modernise reservation systems in partnership with two other airlines.

Local news reports said Ottawa’s support was timely as the carriers were working to fill gaps left when Air Canada (AC, Montréal Trudeau) suspended 30 regional services in June 2020.

Additional CED funding would be made available to several regional airports in Quebec, including Rouyn, Val d’Or, the regional county municipality of Charlevoix-Est, Amos, the Société de développement de la Baie-James (La Grande, QC), and the Cree Nation of Chisasibi, and the Réseau Québécois des Aéroports.