Pearson airport CEO Deborah Flint on surviving the pandemic — and why all of Ontario needs the airline hub to make a full recovery

From the Toronto Star – link to source story

By Brennan Doherty, Special to the Toronto Star | Sat., Nov. 13, 2021

Deborah Flint’s first 21 months at the helm of the Greater Toronto Airports Authority have been, to put it mildly, eventful.

Just a month after she arrived from Los Angeles, Flint watched as the COVID-19 pandemic grounded nearly all air travel at Pearson International Airport. COVID screening became the new normal. Thousands of customs officers nearly went on strike at the airport last August — and thousands of other GTAA employees were laid off. Domestic travel restrictions are now lifting, slowly, but Flint believes governments need to pay a lot more attention to the plight of airports if they care about a solid economic recovery from the pandemic.

Flint spoke to the Star about the GTAA’s looming debt, her optimism about business travel, and why the airport should be allowed to keep its government rent payments:

Before arriving in Toronto, you ran Los Angeles World Airports. That includes LAX, one of the busiest airports in the U.S. What made you decide to move to Canada to run the GTAA?

It was the fourth-busiest airport when I left, and it was in the middle of a $15-billion investment program there. I loved what I was doing, and the team, and the vision that was being implemented, but there are a number of reasons why I came to Toronto. It was a unique opportunity to move back to the country where I was born — I was born in Hamilton. From a business perspective, I was incredibly excited about the prospects and the future for Toronto Pearson. It’s one of the top international gateways into North America. It was the best airport in North America for several years running, according to ASQ (the Airport Service Quality awards).

There was also excitement about building a bigger future at Pearson — in transit, expanding facilities, modernization — and I love to do that type of work. I believe strongly in the power of airports and aviation and what they can do for the economy, and I was very excited to position Toronto to be even bigger and more important.

So you arrived in Toronto and then, a month later, the world shut down. What was it like to wake up in the morning and dwell on that?

It was a very challenging time. We were very busy, even though there weren’t passengers in the early days. We were repositioning aircraft. We were figuring out how to recreate the flow process for essential workers through the airport — to go from point A to point Z — to provide medical care, to get equipment where it needed to be. So there was a lot of work happening at the airport even though the world was coming to a halt.

We saw, very early on, that health was a key issue in the early days of the pandemic, but one that would be present in our passengers or employees’ lives for a long time — likely permanently — in the same way that after 9/11, security posture became a permanent element of air travel. We determined that we had hospital-grade air quality and ventilation systems and made investments in ultra-UV lighting. We brought our outdoor air quality monitor inside to show our passengers that they were in a clean environment. We implemented a number of policies about masking in the terminal.

That recognition of the health process has been very fundamental to our early days and obviously continues today as we find ourselves in a different situation — of being able to travel with a lot more confidence.

How did you afford all that? Those health upgrades were necessary, but also quite expensive — and you were seeing a huge decline in air travellers at that time.

The investments were not significant in terms of cost. They were significant, I think, in terms of knowledge and gaining expertise. We hired, very early on, a chief medical officer to help guide us. We participated in a number of scientific research tables. We conducted, in partnership with the government, one of the largest studies in the world of traveller tests from COVID to understand the conditions of the pandemic in air travel.

As to your point about affordability — during that time to today, like many other industries that were affected by the pandemic, we have massive challenges with revenue. Our business was down 98 per cent. Revenue has essentially stalled. And we did what many other industries had to do — and there were tough calls to make that were necessary: Downsizing our workforce significantly, closing up portions of the airport. Our capital program even today is 25 per cent of what it was.

That’s where we do feel the lack of investment. We are really focused on the maintenance elements and the security and safety elements of the airport infrastructure, and this is the time where we want to be improving the airport for passenger experience. We know that Canadians expect a world-class experience from their airports — as they should. We’d like to be investing in the airport of the future that’s more predictable, more reliable, faster, more efficient, more pleasurable.

How much of your workforce did you have to lay off?

We laid off over 30 per cent of our workforce. Before the pandemic, Pearson Airport had about 50,000 jobs. Some of the highest unemployment rates in the province are in and around the airport. The airport is still finishing this year with about 20 per cent of the traffic we had in 2019. It’s almost linear to the jobs that are still yet to be restored here at the airport, and around the airport — the second-largest employment zone in the country. The first largest is downtown Toronto.

The areas related to our sector are at the bottom of the “K” of recovery, if you will. We’re very motivated to bring flights back in and to get passengers travelling again so the jobs return: accountants, electricians, police, cab drivers. Countries realize that one international flight is worth hundreds of billions of dollars in economic development. In 2019, our contribution to Ontario’s GDP was $42 billion. The importance of Pearson is very tangible. And I’m a strong believer that you cannot have an economic recovery in this country, or locally, or in a province, without a strong Pearson recovery as well.

Business travellers are a major part of any airline. What happens if business travel doesn’t bounce back to pre-2020 levels?

Business leaders want to get back in front of their customers. There is nothing like working on a deal, building on a trust, and collaboration, (and) doing that in person. That’s why, surprisingly, we’ve seen 40 per cent of domestic business travel is returning in North America. It is absolutely more of a challenge on the international side, where there’s a lot of disharmony of rules. But domestic North American business travel is recovering.

You’ve previously said the GTAA could hit up to a billion dollars in additional debt thanks to the pandemic. What would that mean for Pearson’s infrastructure and operations plans going forward?

When you’re borrowing to fund operations and provide essential services for the country and beyond, it did require us to reduce our capital program. We need to create a pathway to reclaim our status as the best airport in North America. That’s going to be a big challenge when we’ve seen many airports, particularly in the United States — LAX accelerated its development and saved a lot of money by accelerating construction. We’re going to have to be very creative about how to generate the funds necessary to modernize our airport to keep up. There’s a price to pay when you let infrastructure decay and you’re no longer competitive. And we don’t want that to happen here.

We’ve been in close discussions with the government and we’ve been proposing that, instead of paying the government rents for the airport — which have been deferred; ultimately, we’d have to borrow to do that — instead, we suggest that over the course of the future, we work with the government to invest that money back into our own infrastructure. That would benefit government more substantially in terms of job creation. It will stimulate billions of dollars of additional revenue for the government.

What’s the government’s reaction been to that proposal?

We’re all at the table. The conversation is ongoing. I think there is an interest in being partners. But I do want them to pay very close attention to this matter and realize how essential airports are to our broader economy.

This interview has been edited and condensed.

Source: https://canadianaviationnews.wordpress.com/2021/11/14/pearson-airport-ceo-deborah-flint-on-surviving-the-pandemic-and-why-all-of-ontario-needs-the-airline-hub-to-make-a-full-recovery/