Expedia and IAC Chairman and senior executive Barry Diller said Thursday that the United States government should bail out companies that have been hit hard by the coronavirus, including those in the travel industry.
Several U.S. airlines on Tuesday said they reached agreements with the Treasury Department for billions in government grants aimed at softening the blow from the coronavirus.
Shares of airline stocks initially rallied on the news but were trading lower on Wednesday.
The virus and harsh measures to stop it from spreading, such as stay-at-home orders, have driven air travel demand to the lowest levels in decades. Carriers have grounded hundreds of jetliners and are asking thousands of employees to take voluntary unpaid leave, in a race to cut costs as cancellations outpaced bookings.
Airlines including American, Delta, United, Southwest, Spirit, JetBlue and Alaska, applied for portions of $25 billion in payroll grants — airlines’ largest ever government aid package — that require airlines not to furlough or cut the pay rates of employees through Sept. 30. U.S. airlines employ some 750,000 people. The grants were part of the more than $2 trillion coronavirus relief package, the CARES Act, which was signed into law last month.
American said the Treasury Department approved $5.8 billion in assistance — a $4.1 billion grant and a $1.7 billion low-interest loan. The Fort Worth, Texas-based carrier said it plans to apply for another government loan of around $4.75 billion.
“By accepting these funds, we have happily agreed to not involuntarily furlough or reduce the hourly pay rates of our U.S.-based team members through Sept. 30, at which point we hope and expect that Americans are regularly flying again,” American’s CEO, Doug Parker, and the airline’s president, Robert Isom, wrote to employees announcing its deal with the Treasury Department.
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