Thank you.

Good morning, honourable members of the committee, and thank you for your time today on this important topic.

In my position as CEO of Exchange Income Corporation, otherwise known as EIC, I am here testifying on behalf of Perimeter Aviation and Bearskin Airlines, two of our aviation subsidiaries.

More broadly, I lead a dedicated team of aviation professionals who manage vital air carriers throughout Canada, including our wholly owned airline brands of Calm Air, Perimeter Aviation, Bearskin and PAL Airways. Wasaya Airways and Air Borealis are jointly owned with first nations and indigenous partners. Keewatin Air, Custom Helicopters, PAL Aerospace and Carson Air provide air ambulance and specialty aviation services.

Each of these air operators has significant track records and experience in providing critical services to remote, northern, indigenous and first nations communities. Together, our family of air operators accounts for over 325 years of experience and investment in northern aviation. We know first-hand that the challenges faced by northern air operators are very different from those of our southern counterparts, and we have learned that the quality of our service and investment in infrastructure are fundamental to our success. Consider the challenges of offering a commercial operation that can move only four or six passengers out of a community on a given day.

Our fleet is diverse and highly customized to meet the demands of the environments in which we fly, while we also operate within the limits of the infrastructure that supports the northern aviation communities and accommodate all the needs of the communities we service. We've invested heavily in basic infrastructure that is needed at northern airports, far beyond what would be typical for traditional airlines, to stabilize our operation and deliver better service.

For instance, the need to build and maintain our own maintenance facilities, fuel farms and ground handling equipment in remote locations, the need to provide staff with housing, and the need to develop our own storage facilities to keep goods at a regulated temperature until our customers can pick them up are all examples of the substantial capital investment EIC has made that our southern cousins would never have to consider.

The communities we serve are very thinly populated and small. For most of the year, they can be accessed only by air. Airlines depend on cargo, especially food, alongside passenger service, to support sustainable service. Any disruption can disproportionately affect remote communities, raising costs and limiting access to essentials. To ensure our operation remains stable and sustainable for the long term, we've built a complex network that links multiple destinations, spreading volume and efficiencies across a network rather than just between two points.

We tailor our operation and invest heavily in our product, because we know that aviation is vital in the places we operate. Alternative access is limited or, in some cases, non-existent.

Air services are crucial for delivering government services like health care, education and public safety, while also being critical in linking the economic opportunity in the north. In that context, our airlines are more akin to public utilities, built on essential services and bonded to the communities we serve.

This is a structure that has allowed our operators to weather market fluctuations. For instance, by partnering with governments and communities, EIC carriers were able to maintain our entire network during COVID, not abandoning a single destination during the pandemic.

At the same time, the investment northern carriers must make to operate shifts the nature of competition. The north cannot sustain multiple providers with overlapping services. Instead, we frequently see multiple providers bidding on long-term contracts for either government or private business, such as mining or natural resource development, that allow the certainty required to build the ecosystem we need to operate and recover our costs over a longer period of time. With reality in mind, we believe that healthy competition in northern aviation should first seek to ensure consistent service, long-term investment and the maintenance of critical infrastructure.

Any policy focused on northern aviation must consider the unique challenges faced by operators and by communities. Southern solutions on regulations, competition or encouraging sustainable investment cannot simply be copied and pasted into the north. Government has a critical role to play in addressing those challenges and finding solutions for sustainable northern aviation. Regulatory frameworks that consider the realities of northern operations or investments in infrastructure that stabilize the operating environment while reducing the cost to communities and our passengers would be welcomed by the industry.

With that in mind, I again commend you for taking on this study. I welcome any questions you may have.