Friday, April 17, 2020
Although the airline industry is hobbled by the coronavirus pandemic but the Trump administration has reached an agreement in principle with major airlines over the terms of a $25 billion bailout to prop up an industry.
According to the Treasury Department Alaska Airlines, Allegiant Air, American Airlines, Delta Air Lines, Frontier Airlines, Hawaiian Airlines, JetBlue Airways, United Airlines, SkyWest Airlines and Southwest Airlines would participate.
The program is expected to help the companies pay their workers and is a part of the economic stabilization package that Congress passed last month.
The bailout negotiations became contentious over the Treasury’s insistence that larger airlines repay at least some of the money they received in the current days.
The government’s support would be structured as part grant and part loan and the Treasury would also receive warrants to buy stock in the companies after the two sides agreed.
President Trump said that the agreement will fully support airline industry workers, preserve the vital role airlines play in their economy and protect taxpayers. Their airlines now are in good shape and they will get over a very tough period of time that was not caused by them.
The Treasury secretary, Steven Mnuchin, said in a statement that the agreement would help preserve the strategic importance of the airline industry while allowing for appropriate compensation to the taxpayers.
The airlines was pushed by the Treasury to repay 30 per cent of the money over five years . While airline executives and labor leaders complained that the Trump administration was turning what Congress intended to be grants into loans.
Tags: trump
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