By David Shepardson and Tracy Rucinski
WASHINGTON/CHICAGO, March 13 (Reuters) - Major U.S. and
European airlines said on Friday they had begun discussions with
governments on obtaining financial assistance to weather a
crippling travel slump brought on by the coronavirus, which has
cobbled global travel and threatens thousands of industry jobs.
Airlines are reeling from a plunge in bookings and traffic,
as the fast-spreading coronavirus pandemic prompts travel
restrictions and event cancellations around the world.
The three largest U.S. airlines -- Delta Air Lines
American Air Lines and United Airlines -- have
sound balance sheets but are raising alarm bells with government
officials about potentially having to furlough tens of thousands
of employees.
The conversations are in the early stages and no specific
proposals have been exchanged, people said.
In Europe, the situation is more dire.
Heavily indebted Norwegian Air said it had "weeks
not months" to avert collapse. [
KLM, the Dutch subsidiary of Air France-KLM, plans
to slash up to 2,000 jobs, cut working hours by one-third for
its entire staff and ask for government support.
German flagship carrier Lufthansa also said on
Friday it was considering a request for state aid.
In a Friday message to staff entitled "the survival of
British Airways," Chief Executive Alex Cruz said jobs would be
cut "perhaps for a short period, perhaps longer-term." Talks
have begun with unions, he said.
Airlines have significantly slashed their flying schedules,
parked jets, frozen hiring and suspended investments and share
buybacks, with many executives forgoing or reducing their
salaries in an effort to save costs.
In the United States, Delta CEO Ed Bastian told employees in
a memo that "the speed of the demand fall-off is unlike anything
we've seen."
U.S. airlines and their trade association met with senior
White House aides on Thursday to discuss the mounting crisis,
three people briefed on the matter said.
"We will be helping the airline industry if we have to,"
U.S. President Donald Trump said on Friday. "So far people
haven't been asking but if they should be asking we want to make
sure our airlines are very strong."
France and Germany have also said they stand ready to help
their carriers.
Delta's Bastian was "optimistic" about receiving U.S.
government support but said the "form and value is
unpredictable."
Delta, United and American have all raised capital in recent
weeks, even as share prices have fallen by between 40% and 56%
over the past month.
Alexandre de Juniac, head of global industry body IATA,
told Reuters revenue losses internationally would be probably
more than the $113 billion the group forecast a week ago, before
the Trump administration's announcement of U.S. travel curbs on
much of continental Europe.
(Reporting by David Shepardson, Tracy Rucinski, Sarah Young,
Victoria Klesty, Toby Sterling and Klaus Lauer; additional
reporting by Alexandra Alper, David Lawder, Andrea Shalal,
Anthony Deutsche and Laurence Frost; writing by Tracy Rucinski;
Editing by Cynthia Osterman)
International Airlines (IAG)
