US airline executives pen letter to Congress for fast action on financial aid
Airlines for America (A4A), the industry trade organization for airlines across the United States, issued a letter on Monday from top airline CEOs urging Congress to quickly enact a bipartisan bill to ensure payroll protections for employees as a means of protecting the 750,000 workers in the industry.
The letter also calls for loans, loan guarantees, and tax measures.
“Time is running out,” the letter states.
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“The worker payroll protection grants are critical to saving the jobs of our employees. Over the past week, we have communicated to our employees the dire situation we are in and the potential impacts on them if our government doesn’t step up to help.”
It continues that airlines are already doing their part, having reinvested 73% of operating profits back into their staff and products.
However, because of the global COVID-19 pandemic and the various government policies and procedures put in place to contain it, the airline industry is taking on over $30 billion (~ $44 billion CAD) of “self-help measures.”
These measures include requesting that employees voluntarily take unpaid time off, keeping plans on the ground, and trying to acquire financing in an already-turbulent credit market.
“Those markets are closing up,” the letter continues.
“Given the extreme nature of this situation, we respectfully urge Congress not to pursue opportunistic measures that will hurt, not help, our ability to recover. Unless worker payroll protection grants are passed immediately, many of us will be forced to take draconian measures such as furloughs.”
The letter also describes what A4A would be willing to return should Congress reach a bipartisan agreement.
First, if payroll protection grants are issued, “equaling at least $29 billion ($42 billion CAD),” airlines (both passenger and cargo) will not lay off employees or reduce their workforce through August 31, 2020.
Additionally, if loans/loan guarantees are ordered, “equaling at least $29 billion ($42 billion CAD),” airlines will commit to putting limits on executive compensation, eliminating stock buybacks over the duration of the loans, and doing away with stock dividends over the life of the loans.
“The breadth and immediacy of the need to act cannot be overstated,” the letter concludes.
“It is urgent and unprecedented.”
The document was signed by multiple executives within the industry, including Bradley D. Tilden (chairman and CEO of Alaska Air Group), W. Douglas Parker (chairman and CEO of American Airlines), Ed Bastian (CEO of Delta Air Lines), Oscar Munoz (CEO of United Airlines Holdings), and Brendan Canavan (president of UPS Airlines), as well as others.
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