Congress just approved a new $900 billion aid package aimed at creating an economic boost as well as provide direct aid to businesses hurt by the coronavirus, including U.S. airlines. Air carriers will be able to access $15 billion in new funds and set-asides to help hire back furloughed workers, which number about 40,000 at present, among other needs. The money, which is available for airline use for the next four months, will also likely be used to help ride out the economic storms created by the steep drop in air travel as a result of COVID-19.
Less in Aid
The new aid package is far less than the $50 billion contained in the CARES Act, which ended on October 1st but it couldn’t have come at a more opportune time for air carriers. For example, Delta Air Lines will receive about $3.2 billion, which is ostensibly to avert furloughs even though the airline managed to avoid layoffs through a combination of early retirements, buyouts, and voluntary leaves of absence. For those airline workers brought back because of the aid, pay is retroactive to December 1st and it promises to brighten up their holiday season, which is undoubtedly good news for all concerned.
Through March 2021
Qualifying U.S. airlines will now be able to support their employee payrolls through March 2021, which will allow them to keep their workers connected to the airline as well as fully trained and ready to fly when the economy recovers and travel picks up again. Airlines will also be involved in the effort to transport the hundreds of millions of doses of the newly approved COVID-19 vaccines now being produced by drug companies.
Third Aid Package
Though no one in Congress has spoken on the record about another round of aid once this newly approved package runs out at the end of March, it seems clear more financial help will likely be needed. At present, airline and travel experts don’t foresee a return anytime soon to the record number of travelers U.S. airlines were transporting before the coronavirus pandemic struck in mid-March of this year. Add in that many nations are seeing often-steep increases in COVID-19 cases during the winter months and the sluggish air travel environment seems sure to hurt airline bottom lines for some time to come.
Possible Bright Spot
For the first time since early March, though, the Transportation Security Administration reports consecutive days in which it has security screened more than 1 million passengers at its airport checkpoints. December 18, 19, and 20 saw more than a million travelers pass through TSA screening on each of the three days, and Monday the 21st nearly reached 1 million as well. Though still off by 60 percent or so from the same four-day period in 2019, the fact that more than a million travelers were security screened indicates a decent measure of travel demand for the holiday period, especially after markedly low demand overall since last March.
Buffeted by Turbulence
Airlines are being buffeted by turbulent economic times driven by a virus and an economy over which they have little to no control so it’s easy to feel at least some sympathy for their plight. U.S. airlines have parked thousands of airliners and both they and the airports they serve have made steep cuts to operational costs to deal with the fallout created by the pandemic. As well, TSA has right-sized operations to better reflect and accommodate the current average number of passengers making their way through the security agency’s airport checkpoints.
Here’s one thing to hope for: If airlines, airports, and TSA can ride out the economic storms created by the coronavirus they may be able to emerge both leaner and more nimble and thus deliver even better services to their stakeholders than ever before.
Kelly Hoggan, Founder and CEO of H4 Solutions, previously served as assistant administrator for operations at the Transportation Security Administration. In that role, he was responsible for aircraft and checkpoint security operations at the nation's 450-plus commercial airports.