Global airlines running out of cash, need state support: IATA

London, March 17: Swift government action is needed to help global airlines that are in a desperate situation and running out of cash, the International Air Transport Association (IATA) warned on a media call on Tuesday.

“If we want to maintain a strong airline sector able to cope with this difficult crisis and provide the resources to ensure the recovery will happen in due time (then) we need governments to act strongly and quickly,” IATA chief Alexandre de Juniac said.

IATA chief economist Brian Pearce added that cash was running out for many airlines and that 75 per cent of them have less than three months of nonavoidable fixed costs.

US airlines have asked the federal government for grants, loans and tax relief that could easily top $50 billion to help them recover from a sharp downturn in travel due to the new coronavirus.

Airlines for America, the trade group representing the carriers, disclosed its request for financial help on Monday, just as more airlines around the world were announcing everdeeper cuts in service and, in some cases, layoffs.

US President Donald Trump pledged to help the airlines, although he did not say what the assistance might look like.

The trade group is asking for $29 billion in federal grants, with $25 billion for passenger airlines and $4 billion for cargo carriers.

The airlines are also seeking up to $29 billion in zerointerest loans or loan guarantees, and they want federal excise taxes on fuel, cargo and airline tickets to be suspended through the end of next year and possibly longer. That package would easily surpass the $5 billion in grants and up to $10 billion in loan guarantees that US Congress approved after the terror attacks of September 2001.

— Reuters, AP