A ground crew member passes by American Airlines aircraft parked at the gate during an outbreak of Coronavirus Disease (COVID-19) at Ronald Reagan National Airport in Washington, United States, April 5, 2020.
Joshua Roberts | Reuters
The Treasury Department said on Tuesday that airlines may receive larger federal loans than previously expected after some airlines pulled out, freeing more money in the program.
In March, Congress approved $ 25 billion in federal loans to US airlines to help them survive Coronavirus pandemicWhich kept the demand for air travel at about 30% of last year’s levels.
Despite the initial agreements, Southwest Airlines and Delta Airlines said they ultimately do not plan to pursue loans, thanks to other sources of financing. Delta, for example, said earlier this month that it had been able to Increase the size of the debt sale Powered by the SkyMiles frequent flyer program, to $ 9 billion from the $ 6.5 billion planned.
Airlines have until Wednesday to decide whether to take in the federal loans.
The Treasury Department said seven airlines – Alaska, American, Frontier, JetBlue, Hawaii, Sky West and United are planning to take out the loans.
America said last week it had gotten $ 5.5 billion from the program, more than the $ 4.75 billion it had expected to receive. The Fort Worth-based carrier said it expects to have up to $ 7.5 billion, the maximum amount for a single company.
U.S. passenger airlines also received parts of $ 25 billion to support salaries, mostly grants, from the government. The money prevents carriers from cutting jobs until October 1, but in just hours, airlines, most of them American and allied, are planning to cut more than 30,000 jobs.
Airlines and their trade unions are urging Congress for an additional $ 25 billion that will keep industry jobs through March 31.