Home https://server7.kproxy.com/servlet/redirect.srv/sruj/smyrwpoii/p2/ Business https://server7.kproxy.com/servlet/redirect.srv/sruj/smyrwpoii/p2/ The US Treasury said it had closed loans to seven major airlines

The US Treasury said it had closed loans to seven major airlines



WASHINGTON / CHICAGO (Reuters) – The US Treasury Department said Tuesday it had closed loans to seven major airlines hit hard by the coronavirus pandemic, and called on Congress to save tens of thousands of airline jobs by providing billions in aid. .

FILE PHOTO: A United Airlines plane is seen in the background as a passenger sits in Terminal C at IAH George Bush Intercontinental Airport amid the outbreak of coronavirus disease (COVID-1
9) in Houston, Texas, USA, July 21, 2020. REUTERS / Addresses Latif

The Treasury Department said in a statement that the seven carriers were Alaska Airlines, American Airlines, Frontier Airlines, JetBlue Airways Corp., Hawaiian Airlines, SkyWest Airlines and United Airlines.

Airlines and unions were still actively lobbying Congress ahead of Wednesday’s deadline for a new $ 25 billion bailout plan to keep workers on wages for another six months, but industry officials admit they face a tough battle within hours. .

U.S. airlines received $ 25 billion in March under the CARE Act, mainly in the form of grants to keep employees paid in September and avoid abandonment.

Finance Minister Stephen Mnuchin on Tuesday called on Congress to extend the wage support program “so that we can continue to support workers in the aviation industry when our economy reopens and continue on the road to recovery.” Last week, Mnuchin rejected executive action to prevent airline layoffs.

House Democrats backed a $ 2.2 trillion measure that would provide assistance to many affected sectors, as well as direct relief for Americans. They are reluctant to support a stand-alone measure that would only help airlines.

Nick Calio, who heads Airlines for America, said Tuesday that carriers “remain hopeful that Congress will act quickly to save these jobs before the September 30 deadline – which is tomorrow – but time is running out.”

American Airlines said on Friday it had secured a $ 5.5 billion loan from the Treasury and could receive up to $ 2 billion more in October.

The airlines, which together continue to burn $ 5 billion a month, must decide by September 30 whether to draw on a $ 25 billion loan from the US Treasury Department, which was approved by Congress in March.

The finance ministry said it expected “the initial loan amounts to be increased as a result of the determination of some large airlines not to continue with loans” and could increase loans to $ 7.5 billion per carrier.

Airlines have also used capital markets to boost liquidity, but passenger traffic is still declining by 68% from pre-pandemic levels.

Report by David Shepardsson and Mohammad Zargam; Edited by Eric Buk and Leslie Adler


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