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Friday, September 17, 2021

Trump to help struggling US airlines facing downturns due to Covid-19

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The Indian Telegraphhttps://theindiantelegraph.com.au/
Established in 2007, The Indian Telegraph is a multi award winning digital media company based in Australia.
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President Donald Trump on Tuesday said his administration would help U.S. airlines facing sharp downturns in passenger traffic as a result of the novel coronavirus pandemic, but gave no details.

“We’ll be helping the airlines. You have to help the airlines,” Trump told reporters before departing on a visit to Kenosha, Wisconsin. “Airlines are a tough business in good times.”

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Airline shares jumped on Trump’s comments but then gave up some gains. American Airlines was up 1.5%, while United Airlines was up 0.5% in early afternoon trading.

White House Chief of Staff Mark Meadows last week said Trump was weighing executive action to avoid massive layoffs at airlines if Congress fails to agree on a fresh economic stimulus package.

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U.S. passenger airlines are still collectively losing more than $5 billion a month as 30% of airplanes remain parked. Passenger travel demand remains down about 70% and, on average, planes are half-full.

Last week, American Airlines said its workforce would shrink by 40,000, including 19,000 involuntary cuts, in October unless the government extends aid for airline employee payrolls.

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United said Thursday it will need to cut 2,850 pilot jobs between Oct. 1 and Nov. 30 if the government does not extend assistance.

Airlines received $25 billion in U.S. government stimulus funds in March meant to cover payrolls and protect jobs through September. Congress also approved another $25 billion in loans for airlines.

As bailout money runs out without a travel recovery in sight, airlines and unions have lobbied Washington for another $25 billion. However, talks have stalled as Congress has struggled to reach agreement on a broader coronavirus assistance package.

American said last month it would suspend flights to 15 small U.S. cities in October without more federal aid.

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