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UPDATE 1-U.S airlines remain in 'dire straits,' need new government assistance -industry group

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David Shepardson and Tracy Rucinski
·2 min read
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(Updates with hearing underway, lawmaker reaction)

By David Shepardson and Tracy Rucinski

WASHINGTON, March 2 (Reuters) - The head of a group representing major U.S. passenger airlines and a senior union official made the case to lawmakers on Tuesday for a third round of federal government assistance, according to testimony seen by Reuters.

Since March 2020, Congress has awarded passenger and cargo airlines, airports and contractors nearly $90 billion in government assistance and low-cost loans, including two prior rounds of payroll assistance for U.S. passenger airlines totaling $40 billion.

The $1.9 trillion COVID-19 relief package approved by the U.S. House last week includes another $14 billion for passenger airlines to keep workers on payrolls for an additional six months. It awaits action by the U.S. Senate.

"We are still struggling and in dire straits," Nick Calio, who heads Airlines for America, a trade group representing American Airlines, Delta Air Lines, United Airlines and others, said in testimony before the House Transportation and Infrastructure's aviation subcommittee. "We were hoping it would be better by now."

He warned that without the new round of assistance tens of thousands of aviation workers will "lose their jobs — or experience reductions to wages and benefits — effective April 1."

In 2020, U.S. airline passenger traffic fell by 60% to 368 million passengers, the lowest since 1984, and reported pre-tax losses of $46 billion. They continue to burn "an estimated $150 million of cash every day," Calio said.

The current COVID-19 bill also includes $8 billion for airports and concessionaires and $1 billion for airline contractors.

Joseph DePete, president of the Air Line Pilots Association, told lawmakers that "dismal long-term booking commitments and the near absence of business travel demand is leaving some carriers with too little certainty to reactivate and retrain furloughed or otherwise inactive pilots."

Representative Peter DeFazio, who chairs the Transportation committee, said he is "hoping by September 30 we are not going to need another extension" of airline payroll assistance. (Reporting by David Shepardson and Tracy Rucinski; Editing by Gerry Doyle and Dan Grebler)