Airline group warns Canada airport privatization may raise travel costs
The global airline industry is pushing back against Canada’s plan to privatize its four largest airports, warning the move will raise costs for travelers. The International Air Transport Association (IATA) said higher fees for airlines, set by private operators, will likely increase ticket prices, contradicting Ottawa’s claim that privatization will lower costs.
The government currently owns the airports and leases them to nonprofit agencies. Under the new model, private investors would pay Ottawa for operating rights and keep profits. Prime Minister Mark Carney has framed the deals as a way to improve services and cut travel expenses, while also raising tens of billions in revenue for the federal budget.
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Nick Careen, IATA’s executive, cited international examples where privatization led to higher airline fees. In Australia, airports that were privatized between 2006 and 2016 saw fees rise by about AU$1.6 billion, according to the country’s competition regulator. Careen told The Globe and Mail that similar trends could emerge in Canada if the plan moves forward.
Ottawa has yet to finalize details, but reports indicate the government has hired financial firms CIBC and Morgan Stanley to structure the deals. The timeline and specific terms remain unclear, though the focus on efficiency gains and lower costs for passengers has drawn skepticism from airlines.
