Balancing act: Canadian North’s first Inuk CEO juggles Arctic airline challenges

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This article was published 12/05/2024 (867 days ago), so information in it may no longer be current.

In a colonnaded limestone building across from Parliament Hill, Shelly De Caria addressed a House of Commons committee on Wednesday as a chief executive for the first time in her 11-year airline career.

“I understand more than many what it means to struggle because of lack of access to affordable food as a child,” De Caria, who grew up in Nunavik in northern Quebec, told lawmakers.

“I remember the hardship and strain it caused, and most of all I remember going to bed hungry.”

De Caria has taken those memories with her to the top spot at Canadian North, where she stepped into the role in December.

She says her main focus will be doubling down on core services — scheduled flights that carry people, food and other essential goods to about 30 villages and cities, the vast majority of them accessible only by plane for much of the year — as the CEO looks to extend a lifeline to northern residents in need of air travel for health, education, business and tourism.

“This obviously can’t be done overnight,” she said in an interview.

De Caria faces a raft of challenges. A pilot shortage and dearth of federal funding are two big obstacles, while weather and infrastructure difficulties particular to the North pose further problems.

With carriers’ flight volumes above the 60th parallel hovering below pre-pandemic levels, Canadian North’s first Inuk CEO now bears the task of balancing those financial and logistical challenges with the needs of communities for which she feels a deep affinity.

Born and raised in Kuujjuaq, Que., in the 1980s, De Caria experienced first-hand the limits on transport familiar to many Inuit communities, most of which rely on planes as their sole connection to the rest of the country for much of the year.

She joined First Air — later to merge with Canadian North — as a sales manager in 2013 partly because it allowed frequent travel back home to Nunavik from its headquarters in Ottawa. At that carrier, she helped develop community investment programs that targeted education, nutrition and mental health.

Since the COVID-19 pandemic wound down, old impediments have resurfaced with a vengeance, including labour shortages, government funding, snowstorms and gravel runways.

“We need to operate to the smallest communities, and not having pilots has been a big challenge,” said De Caria, noting that the shortage is not unique to Canadian North.

Some took off for WestJet last year after it signed a new collective agreement with pilots that featured big pay gains, she said.

The company has also struggled to make up for an end to the funding it drew from federal coffers during COVID-19, when its routes to 21 isolated communities were temporarily deemed an essential service and granted federal subsidies.

“We are the lifeline to the medical patients. The only way down to Ottawa — or Montreal, Winnipeg, Edmonton — is by plane,” De Caria said. She said she hopes to see more federal investment in northern airport upgrades that would allow for more efficient airline operations.

Infrastructure remains a big issue, with short, unpaved runways limiting the type of aircraft that can touch down.

“I can’t land a jet into, say, Cambridge Bay, because the gravel would go into the engine,” she noted. That means the airline has to fly smaller planes more frequently into some communities, at a cost to efficiency.

“Our margins continue to shrink,” De Caria told the Commons committee, saying a one per cent profit on cargo shipments is typical.

Meanwhile, repair and maintenance for the 36-plane fleetoften lie out of reach thousands of kilometres away.

“If you need a filter change and you’re in Iqaluit, there aren’t a lot of spare parts hanging around. You have to fly that spare part into that community,” said John Gradek, who teaches at McGill University’s aviation management program.

He pointed to the cautionary tale of First Air, which joined forces with Canadian North in 2019.

“First Air spent a lot of money building up a lot of inventory across their network to support scheduled services,” he said. “And that overhead is why First Air didn’t make it.”

The lower-tech instrumentation of most northern airports and turboprop planes also means aircraft cannot land in low visibility — a problem in snow-laden regions prone to a low cloud ceiling and long nights at certain times of the year.

“The volumes are low, the distances are long and the weather is unpredictable,” said Gradek, summing up the tough business case.

Balancing business priorities and social prerogatives amount to a daunting tightrope walk, but one De Caria is apt to take on, said Natan Obed.

The Inuit leader recalled De Caria’s commitment to her community during her three years at Inuit Tapiriit Kanatami, the national advocacy organization Obed heads. She served as its youth coordinator from 2007 to 2010, handling files that ranged from mental health and suicide prevention to education, language and culture.

“Her being an Inuk in this role, for all of the people that know that she is there defending her community and also pushing for the success of Canadian North, is really empowering to a lot of Inuit,” Obed said.

The potential for friction remains, however, including over prices and a lack of competition.

Since it merged with First Air, Canadian North has flown far fewer scheduled flights than the two did collectively before 2019. Its flight volume last year sat at less than half of the carriers’ combined levels from 2018, according to figures from aviation data firm Cirium. The tally is much closer if charter flights are included, according to Canadian North.

“There are ongoing tensions, because airlines that service Inuit Nunangat communities have very high prices in relation to similar distances in the south,” Obed said.

Fares for a two-way Iqaluit-Ottawa trip often top $2,000, he noted, though Canadian North tickets can also be found for under $1,000.

“Canadian North largely serves Inuit and Inuit communities, and it’s not in its best interest to alienate its paying customers,” said Obed.

“There are just these systemic challenges, and what we see as the output is uncomfortable in many ways, which in the end makes Shelly’s job very difficult — to manage all the expectations while also doing her best to manage the institution of Canadian North.”

De Caria said she initially “downplayed” her achievement as the first Inuk CEO of the Inuit-owned airline, but has since embraced it.

“I recently flew to Iqaluit and I saw how important it was for not only Inuit, but women as well,” she said.

She highlighted Gov. Gen. Mary Simon, who is also from Kuujjuaq, as a source of guidance who blazed a trail for younger generations.

“I feel like she’s inspired me, but now I can inspire others to dream big,” De Caria said.

“My husband’s a pilot, and my daughter often sees how big a pilot is to everyone who we speak to. But more recently, she’s like, ‘No, my dad’s a pilot, but my mom’s president and CEO.’”

This report by The Canadian Press was first published May 12, 2024.