American Airlines has agreed to a $ 5 . 5 billion loan from the US Treasury as it aims to ride out the downturn caused by the coronavirus , the carrier announced Friday .
The airline , which has said it could lay off as many as 19 , 000 employees next month without another relief package from Congress , said the financing will “ help us shore up our longer - term liquidity until demand returns , ” according to a message to employees .
The loan , authorized as part of the massive CARES Act federal relief package passed this spring , adds to American ’ s mounting debt level , which is higher than that of other leading US carriers .
The Treasury Department told the carrier that the loan could be boosted to as much as $ 7 . 5 billion , “ although such amount is subject to final approval by the Treasury , ” American said in a securities filing .
The CARES Act also provided $ 25 billion in Payroll Support Program ( PSP ) funds for US carriers, including $ 5 . 8 billion to American .
US airlines that took PSP funds committed to not undertaking any involuntary job cuts through the end of September . American has said it could lay off 19 , 000 workers starting in October if there is not a new relief package.
Airline CEOs visited the White House on September 17 to lobby for such legislation , but talks in Congress have stalled amid intensifying partisanship ahead of the November presidential election .
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