US airlines ask for more than $ 50 billion in aid as coronavirus rocks business
An American Airlines Inc. McDonnell Douglas MD-82 plane is parked at a gate as a United Continental Holdings plane taxies onto the runway at LaGuardia Airport in New York’s Queens neighborhood.
Michael Nagle | Bloomberg | Getty Images
U.S. airlines are seeking more than $ 50 billion in government aid, including a mix of direct aid and loan guarantees, as the industry reeling from the coronavirus outbreak, a lobby group that represents 10 US passenger and freight airlines.
The aid, if received, would be the industry’s first bailout since the aftermath of the September 11, 2001 attacks, and the largest ever. It is also the clearest sign to date of the financial damage caused by the coronavirus and the drastic measures governments are taking to stop it have on American businesses.
Airlines for America, which represents carriers including Delta, United, American and South West, recommended passenger carriers immediately receive up to $ 25 billion in subsidies to offset the drop in liquidity and in the medium term $ 25 billion in low or no interest loans.
“In the space of two weeks, US airlines saw their financial health positions deteriorate remarkably quickly,” Airlines for America said in an overview of its recommendations. “The decline in demand for commercial air travel linked to COVID-19 is causing unprecedented harm to the US airline industry. “
Demand for travel in some markets has collapsed completely and is falling more sharply in others, throwing airlines around the world into chaos. U.S. airlines have put in place hiring freezes, cut flights, and warned their employees that the situation is unlike anything they have ever seen, including the terrorist attacks of September 11, 2001.
Executives prepare for a worst-case scenario, including a further drop in demand or a general suspension of most commercial air travel to the United States
President Donald Trump has repeatedly stated that his government is ready to support the country’s airlines, which directly employ more than 700,000 people. The administration has yet to provide details on what the aid might look like.
“We will support the airlines 100%, it is not their fault” Trump said during a press briefing on Monday. “We will support the airlines and help them a lot.”
-CNBC Lauren Hirsch contributed to this report.