Apr 2, 2020
Southwest to Become Second U.S. Airline Applying for Relief
(Bloomberg) -- Southwest Airlines Co. intends to apply for federal aid, becoming the second U.S. carrier saying it will seek government assistance after being battered by a collapse in travel demand because of the new coronavirus.
The airline will file an application “to discuss the specific details regarding possible grants that could boost liquidity and provide job security for its employees,” according to a U.S. regulatory filing Thursday. The Dallas-based carrier joins American Airlines Group Inc., which has said it would apply for as much as $12 billion in aid.
U.S. airlines have slashed flying capacity, parked planes, frozen hiring and taken other steps to cut spending as the virus’s spread has cut travel by more than 90%. Southwest is “in intensive care” and losing money on every flight, Chief Executive Officer Gary Kelly told employees March 30. The airline will cut 40% of its daily flights starting in early May and will evaluate further reductions.
The carrier also tapped $2.3 billion under an amended credit agreement to help fund operations, according to Thursday’s filing.
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