⁍ American Airlines and United Airlines began laying off 32,000 workers after a deadline passed with no new help from Washington.
⁍ U.S. airlines are collectively burning about $5 billion of cash a month as passenger traffic has stalled at around 30% of 2019 levels.
⁍ Between voluntary and involuntary furloughs, major U.S. airlines’ workforce will shrink by at least 25% in October.
– American Airlines and United Airlines began laying off 32,000 workers after a deadline passed with no new help from Washington, but told staff they would reverse this if lawmakers reach a deal on COVID-19 relief. US House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin were expected to continue negotiations on Thursday, reports Reuters. US airlines are collectively burning about $5 billion of cash a month as passenger traffic has stalled at around 30% of 2019. After tapping capital markets, they say they have enough liquidity to last them at least 12 months at that rate. They have argued for another $25 billion in federal payroll aid to maintain their workforce and meet demand as the economy rebounds. Without the money, flight networks could further shrink, hampering their revenue power and shortening their liquidity runway. Between voluntary and involuntary furloughs, major US airlines’ workforce will shrink by at least 25% in October. “Airlines quite correctly have been bulking up on cash … but to be 25% smaller, best case, how are you going to handle the debt service?” asks airline consultant Mike Boyd.
Source: https://www.reuters.com/article/us-health-coronavirus-usa-airlines/us-airlines-face-grim-winter-with-or-without-a-bailout-idUSKBN26M75A