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U.S. airlines await roller coaster aid developments in Washington

Hours before mass furloughs of airline workers go into effect, U.S. airlines were still holding out hope for agreement in Washington over a fresh coronavirus aid package, after the House of Representatives delayed a vote to give more time for talks.

Reuters | Updated: 01-10-2020 04:00 IST | Created: 01-10-2020 04:00 IST
U.S. airlines await roller coaster aid developments in Washington

Hours before mass furloughs of airline workers go into effect, U.S. airlines were still holding out hope for agreement in Washington over a fresh coronavirus aid package, after the House of Representatives delayed a vote to give more time for talks. Earlier, Treasury Secretary Steven Mnuchin said talks with House Speaker Nancy Pelosi had made progress on a bipartisan aid plan although no deal was reached, and Senate Majority Leader Mitch McConnell called a $2.2 trillion proposal "outlandish."

The deadlock had seemed to close the door on a deal before tens of thousands of furloughs begin at midnight, but industry experts said they were encouraged that the two sides were trying to come together. American Airlines Chief Executive Doug Parker said he would consider postponing the furloughs if there was a "clear and concrete path" on a bill.

If not, 19,000 American Airlines workers will be furloughed beginning Thursday, and at least another 12,000 at United Airlines. U.S. airlines have been pleading for another $25 billion in payroll support to protect jobs for a further six months once the current package, which banned furloughs, expires at midnight.

Nick Calio, who heads the airline trade group Airlines for America, said the industry was still pursuing all potential avenues for new assistance as time runs short. "People keep talking, but we need results," Calio told Reuters. "We are hopeful but not confident about them reaching a deal on a larger bill."

U.S. airline shares ended flat on Wednesday. Weeks of intense airline lobbying has won over many but not all Washington lawmakers, while also drawing attention to the plight of other pandemic-hit industries as the crisis persists.

Airline representatives said earlier this week there were no plans in place to halt the furloughs without aid by Oct. 1, and it was unclear what would happen if a deal passes afterwards. Thousands of employees have already been instructed to return their badges.

Airlines, which were awarded a separate $25 billion in federal loans under a first coronavirus relief bill in March and have also tapped capital markets to shore up liquidity, are operating about half their 2019 flying schedules and suffering a 68% decline in passenger volumes. The impact of the coronavirus on travel may cost as many as 46 million jobs globally, according to projections published on Wednesday by Air Transport Action Group.

Airlines have argued they need trained employees to help drive an economic recovery as the pandemic subsides. American Airlines' Parker told CNN he believed one more round of aid would be sufficient. Airline workers said they would keep pressing lawmakers until 11:59 on Wednesday.

"We're not conceding this fight," said Amanda Steinbrunn, a United flight attendant who will be furloughed on Thursday if Congress does not act.


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