U.S. aviation unions ask Congress for another $32 billion bailout

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CHICAGO/WASHINGTON (Reuters) - Six U.S. unions representing aviation workers told top lawmakers on Thursday that another $32 billion in payroll aid is needed to keep hundreds of thousands of workers employed through March 31, as a resurgence in coronavirus cases raises fears that air travel may not rebound this year.

The request, made in a letter to leaders of the House of Representatives and the Senate, comes as Congress in July is set to consider a new round of spending that could top $1 trillion to address coronavirus-related issues and the impact on jobless Americans.

Under the CARES Act passed earlier this year, Congress gave the aviation sector $32 billion to cover six months of payroll through Sept. 30, hoping that a sharp drop in air travel due to the coronavirus pandemic would subside by October.

But executives have since warned that a recovery to 2019 travel levels could still be two years away, forcing the need to lay off employees in the fall without an extension of the Payroll Support Program (PSP).

"Should October 1 arrive without extending the PSP grant job program mass layoffs are inevitable, as airline executives have acknowledged," union leaders said in the letter.

The letter was signed by the Air Line Pilots Association, the Association of Flight Attendants-CWA, the International Association of Machinists and Aerospace Workers, the Transport Workers Union, the Communications Workers of America and the Transportation Trades Department, AFL-CIO.

Major U.S. airlines are offering voluntary exit packages in an effort to slim their workforces before October, and tens of thousands of employees are already taking temporary leaves.

The main airline lobby, Airlines for America, which played a major role in negotiating the first stimulus package, said it is not currently seeking additional federal assistance.

Several airlines have moved to bolster their balance sheets in capital markets this week, with American Airlines raising $4.4 billion through equity and bond offerings.

But airline top executives are increasingly concerned about a potential second wave of COVID-19 after a recent uptick in cases and hospitalizations in a number of U.S. states, one airline executive told Reuters.

"Everyone is holding their breath for a couple of weeks to see what happens," he said.

For the first bailout, the industry argued that airlines form a crucial role in any economic recovery and require trained employees.

Representative Peter DeFazio, who chairs the House Transportation and Infrastructure Committee, told Reuters on Wednesday that “at the end of the” Sept. 30 time frame, Congress may need to consider additional assistance for airlines, including for social distancing on airplanes.

His comment came after the Allied Pilots Association said it was discussing with lawmakers a plan for the government to pay airlines for empty seats to allow for more space between passengers.