Pinch, punch, first day of the month. It’s been a battle-weary journey for the US aviation industry just to reach 1 October.
As I write, the payroll component of the CARES Act, which became law in March, has just expired, putting thousands of airline workers jobs at risk.
With hours left, A4A President and CEO Nicholas E. Calio (pictured) stated: “The CARES Act recognised that in order to save jobs and support general business operations, Congress needed to provide both payroll support and loans. One does not cover the other… Regardless of the loans announced by Treasury…, without funds dedicated specifically to payroll (through the PSP), airlines will have to take action to address the loss of payroll funds.
“To be absolutely clear, furloughs are inevitable without a PSP extension. All of which says to Congress and the Administration: ACT TODAY!”
Days earlier, the US Department of the Treasury closed loans to seven air carriers: Alaska Airlines, Frontier Airlines, JetBlue, Hawaiian, SkyWest, and United, subject to conditions and satisfactory documentation. The reallocation of funds will be subject to a loan concentration limit of US$7.5 billion per passenger air carrier, or 30% of the $25 billion available for passenger air carriers.
Secretary Steven Mnuchin called on Congress “to extend the Payroll Support Program so we can continue to support aviation industry workers as our economy reopens and we continue on the path to recovery”.
IATA CEO Alexandre de Juniac recently labelled the latest near-term industry outlook as getting darker. “This is no time for governments to walk away,” he said. “The industry is grateful to those governments that have already provided support, but new job-saving measures are needed – including financial measures that do not add to overstressed balance sheets.”
As the industry heads into the winter season, its financial position is the worst it’s ever been. Now is the time to care.
