The U.S. Treasury Department said yesterday that major passenger airlines have agreed in principle to a $25 billion rescue package, ensuring airline workers have jobs until October while the industry battles its biggest-ever crisis, Reuters reported. Airlines are hopeful that U.S. passenger traffic, which has dropped by 95 percent due to the coronavirus pandemic, will begin to recover by October but have warned that the slowdown in air travel could extend into next year and even longer. It’s possible they will need another round of government bailouts to survive. Major carriers will receive 70 percent of the funds for payroll in cash assistance that will not need to be paid back, while smaller carriers receiving $100 million or less will not need to repay any funds. The six largest U.S. airlines — American Airlines Group Inc., United Airlines Holdings Inc., Delta Air Lines Inc., Southwest Airlines Co., JetBlue Airways Corp and Alaska Airlines — as well as four other airlines accepted the support, Treasury said. Agreements should be finalized soon and funds disbursed quickly, it said. Carriers were told they could apply for the total salaries and benefits paid in the second and third quarters of 2019, an amount that surpasses American Airlines’ current market value. Under the terms laid out by Treasury officials last week, the government would receive repayment on 30 percent of the funds awarded to large carriers and warrants equal to 10 percent of the loan amount that were priced at last week’s close.
