A $20 billion stimulus package offered for the struggling airlines industry

The beleaguered airline industry is hopeful of a stimulus package under the new payment proposal.



Under a new counteroffer of $1.6 trillion proposed by the U. S. Treasury Secretary Steven Mnuchin, there is a measure to extend a $20 billion in aid to the battered airline industry, White House chief of staff Mark Meadows said on Wednesday,

“There’s $20 billion in the most recent proposal for the airlines that would give them a six-month extension.

He noted that the industry was in urgent need of some infusion of money. Recently, American Airlines and United Airlines, two of the largest U.S. carriers, announced that they were planning to furlough over 32,000 workers from Thursday.

U.S. airlines have been pleading for another $25 billion in payroll support for another six month to protect the jobs in the industry.

The current package availed by the industry banned further furloughs, but it expired on Wednesday.

The new stimulus package has been long under discussion with the White House not ready to extend the aid beyond $1.5 trillion.

But in a bid to push the package, the Treasury Secretary Mnuchin has proposed $1.6 trillion to persuade the Democrats to come to the table to discuss the matter.

“As you get above $1.5 trillion, it gets extremely difficult to justify based on the facts,” Meadows cautioned, explicitly stating that $2 trillion was too much. “If it starts with a 2, it’s going to be a real problem,” he added.

American Airlines CEO Doug Parker said that if Washington comes up with a deal with $25 billion for airlines “over the next few days,” the company will reverse the proposed 19,000 furloughs set to begin Thursday.

United Airlines said the impasse in the House-Senate had forced it to furlough 13,000 workers. Like American Airlines, it too was ready to reverse the order if timely aid was provided.

“It provides a glimmer of hope that something will get done,” said Nicholas Calio, president of the trade group Airlines for America.

Treasury Secretary Mnuchin said Wednesday night that the administration wants to help the beleaguered travel and hospitality industry.

“I don’t think we’re going to make significant progress” until Thursday he said in an interview.

“Ideally, if it’s going to go beyond Thursday they will be close to a deal and say, ‘Hang on for a couple days,’ and we can wait,” Calio said. “Beyond that, the notices have gone and furloughs will go into effect.”

Sara Nelson, president of the Association of Flight Attendants, was hopeful of a quick solution as the airline relief measure was a major part of stimulation packages from both the parties.

She said a bailout that keeps airline workers out too the unemployment lines is beneficial to all.

“These are people who are not going to be able to pay their rent, they are not going to be able to take care of themselves,” Nelson said on CNBC.

Avatar
Christy Gren
Christy Gren is an Industry Specialist Reporter at Industry Leaders Magazine she enjoys writing about Unicorns, Silicon Valley, Startups, Business Leaders and Innovators. Her articles provide an insight about the Power Players in the field of Technology, Auto, Manufacturing, and F&B.

Recent Posts

Aon – Willis asset disposal aims to ease approval of $30 billion merger

Aon – Willis asset disposal aims to ease approval of $30 billion merger

Aon Plc and Willis Towers Watson have agreed to sell $3.6 billion worth of assets to rival Arthur J. Gallagher & Co. in a bid to appease European competition regulators over th
17 hours ago
Roblox declares Q1, reports $387 million revenue as bookings increase

Roblox declares Q1, reports $387 million revenue as bookings increase

Roblox, the hugely popular online gaming platform, reported its first-quarter earnings after becoming a listed company. Its revenue more than doubled as the videogame company benef
2 days ago
Weak US job report results in volatile market

Weak US job report results in volatile market

A weak job report resulted in a record close on Friday for the US stocks. The US labor department’s monthly non-farm payrolls report revealed employers hired 266,000 new workers
3 days ago
Star and Blackstone launch bids to buyout Australia’s Crown Resorts

Star and Blackstone launch bids to buyout Australia’s Crown Resorts

A bidding war has broken out between Australian casino company Star Entertainment Group and US private equity investor Blackstone Group over Crown Resorts, Australia’s bigges
3 days ago
5 Most Expensive Divorce Settlements in History

5 Most Expensive Divorce Settlements in History

Almost half of the marriages end in divorce is an oft-quoted adage, but surprisingly, this is not true in today’s world. The reasons are varied, gender equality, the higher p
4 days ago
JPMorgan Chase appoints two new CIOS in bid to make its C-suite more diverse

JPMorgan Chase appoints two new CIOS in bid to make its C-suite more diverse

JPMorgan Chase, the largest U.S. bank by assets, has appointed two new executives to head its information units in a bid to make its workforce more inclusive and increase racial an
4 days ago