Airlines Slash Schedules, Borrow $17 Billion to Stay Afloat

By Kurt Stolz on 29 March 2020
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American Airlines jets in Miami

As the number of people flying continues to plummet and countries close borders, airlines collectively borrowed $17 billion and continued to slash their schedules in order to continue operations, despite the $50 billion in government aid that U.S. airlines will receive from the government out of its $2 trillion economic stimulus package.

On Friday, American Airlines, the world’s largest carrier, said it would cut its capacity in May by 70% to 80%, while Delta Air Lines, the second largest airline, said it would cut an additional number of international flights to Europe, Asia, Mexico, and the Caribbean, although it did not publish the percentage of its cutbacks

“These changes are due to significantly decreased customer demand and government travel restrictions related to coronavirus,” American said in a statement.

Meanwhile, airlines across the globe borrowed over $17 billion to tide them over.

In the United States, airlines borrowed over $12.5 billion, with Delta at the top of the list with a $5.6 billion loan.  United said it had borrowed $2.5 billion, with $2 billion from private equity firm Apollo Global Management.

America Airlines reported a new $1 billion line of credit from Citibank.

(Photo: Accura Media Group)

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