COVID-stricken US airlines resuscitated amid plans to lay off thousands of workers
Struggling US airlines are set to receive a new payroll assistance package as part of a COVID-19 relief bill, the third round of help since the coronavirus devastated the ailing US travel industry.
US lawmakers on Wednesday gave final approval to a new $14 billion package amid airlines’ plans to lay off thousands of workers.
American and United Airlines had warned their employees that they would be fired in April if the payroll funding wasn't renewed.
"For our 13,000 colleagues who received (possible layoff) notices last month, those are happily canceled -- you can tear them up!" American Airlines executives said.
United Airlines also withdrew layoff notices sent to 14,000 workers, a spokeswoman said.
Airlines for America, an industry trade group, said it “is vital to have our employees on the job and ready to assist as our nation prepares to move forward from this crisis.”
US air passenger travel has fallen by 60% in 2020 to the lowest level since 1984, down more than 550 million passengers.
US media said industry leaders remain cautious after earlier hopes for a recovery dissipated as the COVID crisis continues.
"You can plan with this virus but you can't forecast very well," Nicholas Calio, president of Airlines for America, said.
Major airlines in the country lost $35 billion in 2020 and they continue to burn through $150 million a day.
US airlines have already retired older aircraft and deferred plane deliveries among others to reduce costs during the downturn. Tens of thousands of workers have left the travel industry through early retirement and other voluntary initiatives, reports said.
The new lifeline is expected to continue through most of this year as demand remains severely depressed.
Other airlines in the regions are also struggling amid pandemic as Canada’s government has yet to extend an aid package for the aviation industry, and in Latin America, two large carriers filed for Chapter 11 protection due to COVID-19.
US travel industry experts say full recovery is not expected until 2023 or later, noting that the focus is turning to single-aisle planes, including Boeing's 737 MAX.
The MAX was grounded for 20 months following two fatal crashes and only cleared to resume service in late 2020 after extensive regulatory review and upgrades.
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