CARES Loans to 7 Airlines
Recently, the U.S. Department of the Treasury confirmed that in connection to the Coronavirus Aid, Relief, and Economic Security (CARES) Act, it has closed loans to seven major airlines.
According to reports, the said carriers include Alaska Airlines, American Airlines, Frontier Airlines, JetBlue Airways, Hawaiian Airlines, SkyWest Airlines, and United Airlines.
The officials confirmed that the initial loan amounts the airlines tried to borrow from the $25 billion funds will likely be increased. This is because some major airlines may borrow from the private market instead of loaning through the Treasury Department.
“The payroll support and loan programs created by the CARES Act have saved a large number of aviation industry jobs, and kept workers employed and connected to their health care, during an unprecedented time,” Secretary of the Treasury Steven T. Mnuchin said.
“We are pleased to conclude loans that will support this critical industry while ensuring appropriate taxpayer compensation. We call on Congress to extend the Payroll Support Program so we can continue to support aviation industry workers as our economy reopens and we continue on the path to recovery.”
The Need for Extension
The CARES loan package offered to airlines aims to maintain employee levels until the end of September. However, since it’s about to end, both airlines and employees are anticipating a COVID-19 relief package extension.
“This is no time for governments to walk away,” Alexandre de Juniac, Director General and CEO of the International Air Transport Association (IATA). “The industry is grateful to those governments that have already provided support, but new job-saving measures are needed — including financial measures that do not add to overstressed balance sheets.”
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