U.S. airline industry pleads for $58B in government grants, loans

Alan Levin and Mary Schlangenstein
Bloomberg

The airline industry, ravaged by plummeting bookings due to the coronavirus, is seeking grants and loans totaling as much as $58 billion from the U.S. government as well as temporary relief from various taxes.

As the White House is pressing for ways to assist U.S. airlines, the trade group representing large carriers released a memo on Monday outlining its needs.

“The current economic environment is simply not sustainable, and it is compounded by the fact that the crisis does not appear to have an end in sight,” the group said in the memo.

The industry is also seeking a rebate of excise taxes paid by passengers to the federal government from Jan. 1 through March 31 and a temporary repeal of the tax, according to the group.

Airline aid is a key area under discussion, President Donald Trump’s economic adviser Larry Kudlow told Fox Business.

Airline aid is a key area under discussion, President Donald Trump’s economic adviser Larry Kudlow told Fox Business. House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin have been holding talks on airline assistance, Kudlow said Monday.

This is an extremely fluid situation that is evolving rapidly. The rapid spread of Covid-19, along with the government and business-imposed restrictions on air travel, are having an unprecedented and debilitating impact on U.S. airlines.

Trump officials are “talking with everybody,” Kudlow told reporters outside the West Wing.

When asked if the White House had gotten calls from airlines, Kudlow replied, “Lots of them.” He declined to specify what actions were being discussed. “We’re in touch about their balance sheets and their cash flows.”

Airlines are stepping up efforts to reduce spending, including drastically cutting flying, parking aircraft and reaching agreements with some unions for voluntary leaves of absence. Unions also are joining the carriers to lobby in Washington for the aid package carriers say is needed to keep them afloat.

“In the coming days, we will ask for your support to join in efforts to call on our lawmakers on Capitol Hill for assistance for our industry and our flight attendants,” Lori Bassani, president of the Association of Professional Flight Attendants, told members in a message. The union represents workers at American Airlines.

Unions at United Airlines Holdings Inc. also will take part in a “call to action” for government assistance, the Air Line Pilots Association said in a message to aviators.