Yellowknife lost “in the range of $2 million” when two major firms hoping to carry out cold-weather testing couldn’t find hotel rooms, city councillors were told on Monday.
Lee Stroman, the manager of Yellowknife Airport, said car manufacturer Mitsubishi and aerospace company Embraer “cancelled at the last minute due to a lack of available accommodations” for a planned project last year.
Mitsubishi had needed 54 rooms for a month, he added.
Stroman, making a broader presentation on the airport’s planning and relations with the City, said the lost income for Yellowknife businesses amount to a $2 million hit on the economy.
Cold-weather testing in Yellowknife has become more attractive in recent years, in tandem with increasing pressures on the city’s hotel industry.
As Cabin Radio reported earlier this summer, the airport has begun a hotel feasibility study to assess whether Yellowknife needs more accommodation.
“To be absolutely clear: the airport is not building a hotel, would not build a hotel, has no desire to build a hotel,” said Stroman.
“We want to ask, is it desirable that there be another hotel and, if so, can we come to some ways of quantifying that need?”
‘Lucrative but competitive’
Yellowknife Airport provides facilities, like tarmac, for cold-weather testing but does not manage those operations.
According to Stroman, aircraft manufacturers Airbus and Sikorsky came to the city for similar testing in 2016 and spent almost $5 million, at an average of $700,000 per month, during their stays.
Stroman believes industries ranging from hotels and car rentals through to tool and equipment suppliers all benefit from manufacturers conducting cold-weather tests.
“This is a lucrative but highly competitive market,” said Stroman, who asked for the City’s cooperation to ensure more business is won in future.
“How can we make some of this stuff work better in a more cooperative way?” He asked. “Cold-weather testing has no real benefit to airport operations but it would have a significant benefit to many, many businesses within the community and we really want to advance those kinds of projects.”
Yellowknife’s accommodation crisis has become increasingly apparent in recent years.
In September 2017, the city’s hotels operated at 90 percent of their capacity according to one survey – leaving some nights where no rooms were available and visitors had to rely on help from residents offering private accommodation.
Since then, Yellowknife’s Coast Fraser Tower has reverted from a hotel to apartments – helping to ease the city’s separate shortage of rental units but further reducing the stock of hotel rooms available for the coming winter testing season.
On Monday, said Stroman, a Korean company will meet with airport executives with a view to beginning a multi-year cold-weather testing program in 2019.