U.S. airlines, through their trade group Airlines For America (A4A), are asking the federal government to rescind restrictions on minimum flight requirements as part of the conditions to receive a cumulative $50 billion in aid from the CARES Act stimulus package.
The requirements were based on pre-coronavirus flights and schedules, a model that airlines say has become unsustainable in the wake of an unprecedented drop in demand for travel.
"We would ask both this Committee and the Administration to seek solutions to address the challenges posed by this unsustainable requirement," Airlines For America CEO Nicholas Calio said in the prepared testimony ahead of a hearing at the Senate Committee on Commerce, Science and Transportation. "Make no mistake, as the duration of this pandemic lingers, the reasonability and practicality of this requirement significantly diminishes. Carriers and communities alike are going to have to come together and acknowledge the footprint and frequency of service in 2019 cannot convey to the 2020 COVID-19 pandemic reality."
U.S. air travel demand dropped 96 percent in April, levels not seen since the 1950s according to A4A.
In fact, domestic carriers are losing $10 billion a month combined and carrying just an average of 17 passengers per flight on domestic trips.
The Department of Transportation has issued some waivers but Calio said "the cost associated with operating nearly empty flights to communities with little to no demand significantly exacerbates air carrier liquidity."
But Sen. Richard Blumenthal, D-Conn., a noted critic of airlines, again chastised the airlines for only offering vouchers and credits for canceled flights instead of cash refunds.
"In effect, you are - forgive me - screwing the very taxpayers whose money is going into your pockets" through the $50 billion in federal aid set aside for passenger airlines in the CARES Act, Blumenthal said.
Calio said that refunds are outpacing bookings and that requiring cash refunds for everyone would very quickly push airlines toward bankruptcy.
For the latest travel news, updates and deals, subscribe to the daily TravelPulse newsletter.
Topics From This Article to Explore
