As layoffs expire for the airline industry, Congress remains at a deadlock in a new round of coronovirus incentives.
Joint Chief Executive Officer Scott Kirby said Sunday that some of the economy’s industries have recovered, “anything to do with leisure, hospitality, meetings, conference services [and] The restaurants are all aching, and clearly, near depression levels. ”
“It was a truly remarkable bipartisan response to save not only the aviation industry, but the entire economy back in March,” Kirby said in an interview on CBS’s “Face the Nation”. “But it’s longer-lasting and deeper than most people. Then our revenue, we just said, is going down 85% in the third quarter. And in a world like this, United Airlines and others come October. Huh.” 1, without the extension of the CARES Act … going to be forced to lay off employees just to survive. ”
He points out that business travel is “almost none”, while leisure travel is “far below where it was before.” For international travel, United States revenue had a 96% year-on-year decline for the second quarter and continues to hit due to the closure of coronovirus restrictions.
Airlines, running out of time to get more support
Kirby said the demand for air travel shows no signs of rebound at any time without feeling safe around each other.
“It’s going to take a vaccine, and that’s just the reality,” Kirby said. “Some businesses may be okay at first, but what we support in aviation and all industries is going to last longer.”
While the airline has gone to the private market for about $ 18 billion in capital to get through the epidemic, Kirby said it is not a sustainable long-term strategy because millions of dollars are burned each day.
“In a world where we’re still burning $ 25 million per day, you just can’t go on that forever,” Kirby said. “And we believe that demand is not coming back. People are not going to come back and travel, as they did before, unless there is a vaccine that has been widely distributed and is used in the population. Available for a large part. And I hope that happens soon, but we anticipate that it’s the end of next year. And so you survived those losses through that time and be ready to bounce back . ”
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By then, the United States’ plan to lay off 16,000 employees of the original $ 25 billion bailout for the airline industry ends on October 1. While at least 3,000 of those jobs would be saved due to an agreement with the pilot union last week, thousands still have to be left to settle to remain joint.
“We believe the long-term is capable of bringing everyone back in the future,” Kirby said. “But getting through a crisis where revenue is down 85% is not sustainable just for industries like aviation or almost any business for that matter.”
As businesses are pushed to their limits financially for the epidemic season, Kirby hopes that layoffs in his industry are only the beginning.
“The reality is without more government support for the entire economy, there is going to be more layoffs to get into the economy.”
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