COVID Money Tracker: Airline Worker Support
Of the $2.2 trillion in fiscal support made available under the CARES Act, roughly $60 billion was allocated specifically to the airline industry and auxiliary companies. That includes a $32 billion Air Carrier Worker Support program, which provides grants and loans to help passenger and cargo airlines as well as ground service providers retain and pay their workers. As we show below, the Department of Treasury has allocated much of that money, including $16.1 billion in grants, $6.6 billion in loans, and some funds that still have not been publicly disclosed. Nearly half of the money for passenger airlines has been disbursed so far.
This blog post is a product of the COVID Money Tracker, a new initiative of the Committee for a Responsible Federal Budget focused on identifying and tracking the disbursement of the trillions being poured into the economy to combat the crisis through legislative, administrative, and Federal Reserve actions.
The airline industry has been hit particularly hard by the novel coronavirus outbreak and subsequent lockdowns across the country, with air traffic down by 95 percent by some metrics. To address this concern, the CARES Act included significant direct support for the airline industry and related businesses, including $32 billion in payroll support for passenger airlines, cargo operators, and ground service contractors, and $29 billion in direct Treasury loans and loan guarantees made available for passenger airlines and cargo operators.
The Air Carrier Worker Support program allocates $25 billion for passenger airlines to use exclusively to pay employee wages, salaries, and benefits. A further $4 billion is available for cargo airline operators and $3 billion for airline contractors.
In exchange for federal assistance, airlines that participate in the payroll support program are required to refrain from layoffs and/or furloughs through September 30, 2020. Airlines who accept funds are also required to pause stock buybacks and dividends through September 30, 2021, place limits on executive compensation, and, in some cases, issue stock warrants, options, preferred stock, debt securities, or notes to the Treasury.
Per Treasury guidance, airlines will receive around 70 percent of their assistance in the form of a government grant and 30 percent in the form of a low-interest loan, depending on the size of the aid to each airline. So far, the Treasury Department has received over 230 applications from passenger airlines for payroll support and many of the major airlines have announced how much they will receive under the terms of the program.
In order of size, American Airlines has been allocated $5.8 billion ($4.1 billion in grants, $1.7 billion in loans), Delta Airlines has been allocated $5.4 billion ($3.8 billion in grants, $1.6 billion in loans), United has been allocated $5 billion ($3.5 billion in grants, $1.5 billion in loans), and Southwest Airlines has been allocated $3.3 billion ($2.3 billion in grants, $1 billion in loans). Alaska Air and JetBlue will receive nearly $1 billion each, and a number of other airlines will receive smaller grants and loans.
|American Airlines||$4.1 billion||$1.7 billion||$5.8 billion|
|Delta Air Lines||$3.8 billion||$1.6 billion||$5.4 billion|
|United Airlines||$3.5 billion||$1.5 billion||$5.0 billion|
|Southwest Airlines||$2.3 billion||$1.0 billion||$3.3 billion|
|Alaska Airlines||$725 million||$267 million||$992 million|
|JetBlue Airways||$685.1 million||$250.7 million||$935.8 million|
|SkyWest Airlines||$336.6 million||$101.4 million||$438 million|
|Spirit Airways||$264.3 million||$70.4 million||$334.7 million|
|Hawaiian Airlines||$233 million||$57 million||$290 million|
|Allegiant Air||$86 million||$85.9 million^||$171.9 million|
|Mesa Airlines||$92.5 million||N/A*||$92.5 million|
|Total disclosed:||$16.1 billion||$6.6 billion||$22.8 billion|
|Undisclosed or uncommitted funds for passenger airlines:†||$2.2 billion|
|Total publicly allocated for passenger airlines:||>90%|
|Total disbursed:||$12.4 billion|
Sources: SEC filings, Treasury press releases, media reports, and CRFB calculations. Numbers may not add due to rounding.
*Airlines receiving $100 million or less receive all of the support in the form of a grant.
^While Allegiant Air has announced the total amount of support it will receive under the program and that it has received a grant of $86 million, it has not disclosed exactly how much loan support it will receive.
†Frontier Airlines is listed in Treasury statements as a recipient of Payroll Support aid, but the airline is private-equity-owned and has not publicly announced how much it will receive under the program. Other smaller airlines, such as Republic Airways and ExpressJet Airlines, have also been listed as aid recipients, but public information on the exact amounts is unavailable.
The first payments under the Air Carrier Worker Support program were distributed on April 20. $12.4 billion has been disbursed so far according to daily Treasury statements, representing nearly 50 percent of the total amount available for passenger airlines.
We will continue to track disbursements under this program in our main COVID Money Tracker table, updated regularly.