U.S. airlines warn that they could run out of money by June 30, calling on the federal government to extend $58 billion in grants and loans to tide them over
... [+]With air travel slowing dramatically amid the coronavirus pandemic, U.S. airlines could run out of money to pay their obligations by the end of this year, or by midyear in a worst-case scenario, an industry group stated Monday, calling on the federal government to extend $58 billion in grants and loans to tide them over.Airlines for America estimates
that its members’ liquidity could fall to a negative $14 billion by the end of 2020, and could potentially go negative by June 30 if airlines’ credit card partners begin to withhold cash from sales to protect themselves. In an optimistic forecast in which capital markets remain open, its member airlines would see their liquidity drop 59% to $16 billion by year-end, A4A estimates.
If a 30-day domestic travel ban is put in place, as has been rumored, the group said it would worsen liquidity in its optimistic forecast by $7 billion and $10 billion in the pessimistic scenario. The group called for the federal government to provide $25 billion in grants to passenger carriers and $4 billion for cargo carriers; $25 billion in unsecured loans or loan guarantees to passenger carriers and $4 billion to cargo carriers; and relief from 2020 excise taxes.
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