Air Transat Counts US$84 Million Cost of Cuba’s Tourism Collapse
CUBA · ECONOMY
Key Facts
- —The Cuba bill Suspending its Cuba flights has cost Transat 116 million Canadian dollars (about US$84 million) in lost revenue over the nine months to 31 July 2026.
- —The quarter Revenue rose 3 percent to C$792.7 million (about US$573 million), but Transat posted a net loss of C$106.6 million (about US$77 million) for May to July.
- —The fuel shock A 56 percent jump in fuel prices added a gross C$105 million (about US$76 million) in the quarter, with a cumulative hit of roughly C$175 million (about US$126 million) since the crisis began.
- —The lifeline Transat has fully drawn a C$150 million (about US$108 million) federal resilience facility and secured a further C$250 million (about US$181 million) emergency government loan.
- —The market Canadian arrivals in Cuba fell to 127,645 between January and July, down more than 70 percent, and no direct Canada-Cuba flights remain.
Cuba’s tourism collapse has crossed the Florida Straits and landed on a Montreal balance sheet: Air Transat, the Canadian leisure airline that built a franchise on flying Canadians to Cuban beaches, is now surviving on government credit while its former winter stronghold stays dark.
Air Transat’s parent company, Transat A.T. Inc., reported its third-quarter results on Thursday 10 September 2026, and the numbers show what seven months without Cuba have done to Canada’s largest leisure airline.
The suspension of flights to the island, in force since 9 February 2026, cut revenue by C$35 million (about US$25 million, at roughly 1.38 Canadian dollars to the US dollar) in the May-to-July quarter alone. Over the first nine months of the fiscal year, the Cuba hole reached C$116 million (about US$84 million), the company said.
The figures, first framed in the Cuban context by the independent outlet 14ymedio on Friday, confirm that the Cuban market — historically about 9 percent of Air Transat’s offering, according to the newspaper — has turned from cash machine into millstone. The airline has avoided giving any date for a return.
From Winter Cash Machine to Write-Off
For decades, Canada was Cuba’s tourist lifeline, and Air Transat was its busiest shuttle. From Montreal and Toronto, the airline flew package holidaymakers to Varadero, Cayo Coco, Holguín and Santa Clara — often several times a day in high season. Canadians made up the island’s largest source of visitors by a wide margin.
That ended abruptly in February, when Cuban airports warned they could no longer guarantee jet fuel. Air Transat was among the first carriers to halt flights and send empty aircraft to bring thousands of holidaymakers home. What was first billed as a pause until 30 April became a rolling postponement — and on 5 June the airline announced an indefinite suspension, citing “the current geopolitical situation in Cuba.”
Air Canada and WestJet, together with its Sunwing vacation arm, followed with indefinite suspensions of their own. Since then, Canadian arrivals — 127,645 from January to July, down more than 70 percent from 2025 levels — have dwindled to a trickle after February, according to Cuban statistics cited by 14ymedio. The newspaper notes that not a single direct flight now links Canada and Cuba.
Fuel, Not Just Cuba
Cuba is only part of Transat’s pain. Fuel prices rose 56 percent year on year between May and July, adding a gross C$105 million (about US$76 million) to costs in the quarter and roughly C$175 million (about US$126 million) cumulatively since the fuel crisis began, chief financial officer Jean-François Pruneau said. Higher pilot salaries under a new collective agreement and persistent Pratt & Whitney engine problems added to the strain.
The airline chose not to pass the costs on to passengers, chief executive Annick Guérard told analysts, because competitors flooded the market with discounts. “We had never seen such a highly competitive network,” she said — one promotion after another all summer. Revenue still grew 3 percent to C$792.7 million (about US$573 million) on 6 percent more traffic, but the load factor slipped to 84.7 percent from 85.0 percent a year earlier, and adjusted operating income swung from a positive C$81.2 million (about US$59 million) to a negative C$0.9 million (about US$650,000).
“Our third-quarter results were significantly impacted by sustained higher fuel prices, which remained elevated well beyond expectations and were the primary driver of lower profitability,” Guérard said in the company’s statement.
Kept Afloat by Ottawa
Cash and equivalents shrank to C$243 million (about US$176 million) at the end of July. Transat has now fully drawn its C$150 million (about US$108 million) credit under the federal Liquidity for Airline Sector Resilience facility, and on 9 September — the day before results — it secured a further C$250 million (about US$181 million) emergency loan from the Canada Enterprise Emergency Funding Corporation under the existing Large Employer Emergency Financing Facility agreement.
The new loan matures in 2035 and carries interest of 1.22 percent for the first three years. It comes with conditions: Transat committed to further cost-cutting beyond its existing “Elevation” programme. The federal lender already holds preferred shares and warrants that could give it close to a fifth of the airline’s voting stock — a measure of how deep the state now sits in Transat’s cockpit.
What It Means for Travellers
For Canadians and other foreigners with Cuba plans, the message is blunt: there is no direct air bridge, and none is scheduled. Travellers who still go route themselves through Mexico, Panama or the United States on carriers such as Aeroméxico, Copa and American, which continue to serve the island. Ottawa’s travel advisory warns of shortages of food, medicine, fuel and electricity, even inside resorts.
The collapse is visible on the Cuban side too. Authorities have closed or “compacted” dozens of hotels this year to save power, Spain’s Meliá completed its exit on 24 July with a 79.4-million-euro (about US$92 million) provision, and visitor arrivals overall have collapsed this year, as The Rio Times reported earlier this week. Guérard’s stated priorities are now a loyalty programme by year-end and a premium-cabin refit in 2027 — not Havana.
Whether Air Transat ever returns to Cuba depends less on the airline than on the island’s fuel supply and Washington’s sanctions calendar. For now, the route map of Canadian leisure aviation has a hole exactly where its oldest winter sun used to be.
Sources: 14ymedio · Transat A.T. Q3 FY2026 results · The Rio Times: Cuba tourism arrivals collapse
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