%1

United Airlines has agreed to delay the effective date of pilot furloughs until Oct. 30 while union members vote on a broader deal that would protect some 2,850 jobs for months longer, Reuters reported. However, pilots will not be paid during the month of October if that deal does not pass, according to a memorandum of understanding between United and the union representing its 13,000 pilots that was seen by Reuters. “Our pilots are voting right now on a tentative agreement that, if approved, would avoid all pilot furloughs for at least nine months,” United spokesman Frank Benenati said on Wednesday. He noted that the company continues to push for an extension of federal payroll support. If lawmakers fail to agree to extend $25 billion in payroll aid for airlines this month, tens of thousands of employees are set to be furloughed on Oct. 1. Delta Air Lines agreed with its pilots to delay furloughs until Nov. 1, the union said on Monday, but will continue to pay them in October even without an extension of $25 billion in payroll support for airlines.

U.S. motorcycle maker Harley-Davidson said today that it expects to report $75 million in additional restructuring costs for 2020 related to actions including discontinuing its sales and manufacturing operations in India, Reuters reported. The announcement comes two months after Harley unveiled a strategy to shift focus back to more profitable motorcycles and core markets such as the U.S. Harley said earlier in the year that it planned to reduce its product portfolio and exit lower volume markets, without specifying which ones. The company said it now expects total restructuring costs of about $169 million in 2020, and this will also include a workforce reduction of about 70 employees in India, a market where its annual sales volumes account for less than 5 percent of the company's total.

Federal Reserve officials on Wednesday doubled down on efforts to convince investors they will keep monetary policy easy for years to allow unemployment to fall, emphasizing that interest rates will stay near zero until inflation gets to 2 percent and stays there, Reuters reported. The Fed’s governing board made that vow last week at its regularly scheduled policy meeting, promising to leave rates at their current near-zero levels until the economy reaches full employment, inflation has risen to 2 percent, and is on track to moderately exceed that level. Both Fed Vice Chair Richard Clarida and Chicago Fed President Charles Evans were adamant on yesterday: Rates will not increase until labor markets recover fully from the economic downturn caused by the coronavirus, and prices hit the Fed’s target. Boston Fed President Eric Rosengren said it may take longer for the central bank to hit that target if infections rise in the fall and winter, leading to slower growth. “We’d be lucky to get 2% inflation within” four years, Rosengren said during a virtual forum organized by the Boston Economic Club.

Top U.S. economic policymakers opened the door yesterday to further aid for small businesses hit by the coronavirus-triggered recession, but differed over how broad it might extend and the manner in which it should be delivered, Reuters reported. In testimony before the House of Representatives Financial Services Committee, Treasury Secretary Steven Mnuchin and Federal Reserve Chair Jerome Powell were pressed by lawmakers concerned the multi-trillion-dollar effort to battle the economic fallout from the pandemic had left a broad swathe of businesses vulnerable, from the smallest corner restaurants to commercial office properties and hotels. Mnuchin and Powell said that they were looking for ways to extend more help, but also that they were hitting legal and practical limits that might require action by Congress to avoid. Fed loans backed by commercial buildings as collateral, for example, were often prohibited by existing lending agreements that forbid the owners from further borrowing, Powell said. And proposals that the U.S. central bank loosen requirements for its Main Street Lending Program to make it more accessible to smaller firms, he said, overlooked the fact that larger businesses have been the ones interested in central bank credit. “There is very little demand below a million dollars,” Powell said in response to Mnuchin’s suggestion that the minimum loan size under the facility could be lowered from $250,000 to $100,000. Help for small businesses, Powell said, would better come through another grant-type program like the Paycheck Protection Program because “trying to underwrite the credit of hundreds of thousands of small businesses would be very difficult,” for the Fed.

The Trump administration is urging U.S. lawmakers to pass separate bills to aid airlines and other sectors, given failure to reach agreement on a broader package of stimulus funding, Reuters reported. The U.S. Congress has been deadlocked over another round of economic stimulus aimed at blunting the effects of the coronavirus pandemic that has now killed over 200,000 people in the U.S. U.S. airlines, facing a huge drop in demand due to virus-related lockdowns, on Tuesday mounted a last-ditch bid to persuade Congress to approve a new $25 billion bailout to help avert thousands of furloughs set to begin Oct. 1. Delta Air Lines has agreed to delay a decision on pilot furloughs until Nov. 1, the pilots union said on Tuesday. Two key Republican senators this week introduced a bill that would authorize $28.8 billion in payroll aid for the airlines. But congressional aides say a stand-alone measure is unlikely to win passage given aid requests from so many other struggling industries. White House Press Secretary Kayleigh McEnany said that talks about a broader stimulus measure were continuing with House of Representatives Speaker Nancy Pelosi, and said the White House’s agreement to accept a measure valued at $1.5 trillion could still lead to some progress. In the absence of a bigger bill, she urged Pelosi to work on separate legislation to address the needs of airlines, which have warned that they will be forced to carry out mass layoffs unless they receive additional assistance.

Avianca Holdings SA, one of Latin America’s largest airlines, lined up a $2 billion bankruptcy-loan package to finance its stay in chapter 11 from a group of investors and lenders including United Airlines Inc. and Chairman Roberto Kriete, WSJ Pro Bankruptcy reported. Since filing for bankruptcy in May after the coronavirus pandemic curtailed flying, Avianca has been working to raise capital to stay in business as air travel remains deeply depressed world-wide. With the loan proposal, the three large Latin American airlines pushed into bankruptcy by the pandemic — Avianca, Latam Airlines Group SA and Grupo Aeromexico SAB — have all found sources of private capital to weather the financial impact of COVID-19. Avianca is fast running out of cash, with its balance down to $150 million. The airline expects to remain in the red for at least eight more months, according to a court filing by Avianca’s investment banker John Luth. It resumed commercial flights Sept. 1. The loan package is backed by the company’s LifeMiles loyalty program, estimated to be valued at as much as $1.6 billion, as well as by its cargo business, according to Luth’s declaration.

Wendy’s Co. and Pizza Hut LLC are raising concerns over their largest franchisee’s effort to sell its assets, including the franchise agreements, in bankruptcy court, WSJ Pro Bankruptcy reported. NPC International Inc., which operates 392 Wendy’s and 1,200 Pizza Hut restaurants, filed for bankruptcy in July with a plan to find buyers for its assets. The company’s franchisee agreements with the restaurant operators are the most valuable assets it is marketing in its sale process. Both Wendy’s and Pizza Hut have recently warned in filings with the U.S. Bankruptcy Court in Houston that they are uneasy about any sales of the franchise pacts to third parties. Wendy’s said that the company doesn’t have enough say at an early stage over which interested bidders can participate in the sale process. Meanwhile, Pizza Hut claims NPC can’t sell its Pizza Hut restaurants to a third party since it has failed to keep up performance at a level required by its franchise agreement. Binding bids for the Wendy’s and Pizza Hut restaurants are due on Oct. 20 and Nov. 5, respectively. Bids for all of NPC’s assets are also due Nov. 5, court filings show.

Ralph Lauren Corp. said yesterday that it would cut 15 percent of its global workforce by the end of this fiscal year as the luxury retailer strives to lower costs and ride out the impact of COVID-19 on sales and shopping habits, Reuters reported. The New York-based fashion house, which has 530 stores globally, said the changes would see it move more business online. The company did not say how many or what type of jobs could go, but based on its last reported total workforce of about 24,900 employees, the changes could impact more than 3,700 employees. “The changes happening in the world around us have accelerated the shifts we saw pre-COVID, and we are fast-tracking some of our plans to match them,” Chief Executive Officer Patrice Louvet said. The health crisis has hit demand for high-end handbags, apparel and accessories as more customers hold back on non-essential spending, forcing many companies to slow their expansion plans. It has also put the brakes on the industry’s biggest ever merger, with France’s LVMH trying to back out of its $16 billion deal to acquire Tiffany & Co. Britain’s Burberry Group and luxury department store operator Harrods have also cut hundreds of jobs.

The New York City Council is considering several bills that would aid restaurants as they try to recover from the economic hit brought on by the new coronavirus pandemic, including one that would make sidewalk and curbside street dining permanent, the New York Times reported. Mayor Bill de Blasio announced in July that the Open Restaurants program, a key feature of the city’s effort to support restaurants financially during the pandemic, would be extended until Oct. 31. The program allows restaurants and bars to expand outdoor seating in sidewalks, city streets and parking lots to increase revenue while maintaining social-distancing guidelines intended to curb the spread of the virus. As part of the legislation introduced by City Councilman Antonio Reynoso, restaurants and bars would also be allowed to use propane heaters, which are currently banned in New York City. The Department of Transportation would also be required to set up an online application process that can be used by restaurateurs to certify their establishments for outdoor dining, according to the bill. Currently, the city only allows pickup and outdoor dining at restaurants. New York Gov. Andrew Cuomo said earlier this month that restaurants could resume indoor dining at 25 percent capacity starting Sept. 30.

U.S. home sales surged to their highest level in nearly 14 years in August as the housing market continued to outperform the overall economy, but record high home prices could squeeze first-time buyers out of the market, Reuters reported. The report from the National Association of Realtors confirmed home sales had recovered after slumping when the economy almost ground to a halt as businesses were shuttered in mid-March in an effort to slow the spread of COVID-19. Existing home sales increased 2.4% to a seasonally adjusted annual rate of 6 million units last month, the highest level since December 2006. August’s increase in homes sales, which marked three straight months of gains, was in line with economists’ expectations. The median existing house price jumped 11.4 percent from a year ago to a record $310,600 in August. Sales last month were concentrated in the $250,000 to $1 million and over price range, with transactions below the $250,000 price band down sharply.