Risk & Compliance

Trump Signals Support for More Airline Aid

"We’ll be helping the airlines, you have to help the airlines,” the president says as carriers warn of layoffs.
Matthew HellerSeptember 2, 2020
Trump Signals Support for More Airline Aid

President Donald Trump indicated he supports more government aid to avert layoffs at U.S. airlines after their current relief package expires at the end of the month.

Congress set aside $25 billion for U.S. passenger carriers in the $2.2 trillion CARES Act in March on the condition that they wouldn’t cut jobs through Sept. 30.

With that deadline now looming, Trump suggested Tuesday that more coronavirus relief was on the way.

“We’ll be helping the airlines, you have to help the airlines,” he told reporters. “It’s a tough business, always is.”

White House Chief of Staff Mark Meadows said last week that Trump was weighing executive action if Congress fails to agree on a fresh economic stimulus package to counter the fallout from the pandemic.

Helping the airline industry is a “significant concern” for the Trump administration given its strategic importance for national security and supply chains, in addition to the large number of jobs at stake, a senior administration official told Reuters.

U.S. passenger airlines are still collectively losing more than $5 billion a month as 30% of planes remain grounded. Passenger travel demand is down about 70% and, on average, planes that are flying are half-full.

American Airlines has said it will furlough 17,500 union employees, including flight attendants and pilots, in October unless Washington provides another $25 billion to help carriers cover payroll costs through next March.

“When Washington first approved airline aid, it was designed to help the carriers survive until air travel and ticket sales improved,” USA Today reported. “While there was a pickup in late spring, the recovery stalled in July and August.”

The airline industry’s global trade group, the International Air Transport Association, predicts that air travel won’t return to 2019 levels until 2024.

According to the senior administration official, there is significant bipartisan support in Congress for measures to help airlines and ensure they survived the prolonged collapse in demand.

Jeff Swensen/Getty Images