Skip to main content

Aviation Industry Updates: February 16, 2021

By February 16, 2021Industry News

U.S. House Approves $14 Billion Proposal | Are Airlines Drunk On Stimulus?


  • A U.S. House committee on Thursday approved a proposal to give airlines another $14 billion in payroll assistance as part of a broader COVID-19 relief package that is working its way through Congress.
  • It would be the third round of support for the pandemic-hit industry. American Airlines and United Airlines have warned of some 27,000 furloughs without an extension of the current package that expires on April 1.
  • The funds will be included in the $1.9 trillion COVID-19 relief bill proposed by President Joe Biden, whose initial plan did not include new money for airlines.
  • American Airlines said in a statement after the committee vote that the payroll support program, which covers employee wages and bans job cuts, “has been a lifeline for our team members.”
  • The Air Line Pilots Association, the largest pilot union in the world, said the funds “would help prevent the additional financial devastation that would result from the aviation industry being forced to furlough tens of thousands of workers.”


Spirit Airlines | Hiring Pilots For Growth


  • Spirit plans to resume new pilot and flight attendant training courses next month for the first time since early in the pandemic.
  • “We’ll be a big hirer again,” CEO Ted Christie said Thursday. “Growth in the airline industry is going to be at the leisure end, and we’re the primary server of that guest.”
  • “Our training footprint can only handle so much, so it has to be phased,” Christie said of the company’s hiring plans.
  • Spirit, like others, is now hoping that the rollout of vaccines will help spur a revival in air travel. The airline expects to get back to 2019 capacity levels by midyear, it said.
  • Spirit and other airlines saw weaker-than-expected demand as Covid cases rose late last year and at the start of 2021, as well as a slow start to vaccine distribution. New travel restrictions such as Covid test requirements for international, U.S.-bound flights also hurt bookings.
  • When asked whether he supports additional aid even though the airline is hiring, Christie said: “Our industry needs to be fair in all cases, so there can’t be selective aid. To the extent that the government does decide to either extend the existing program or modify it, then I think it is to be expected that all airlines would be a beneficiary there.”
  • Scott Harrelson, Spirit’s CFO, was quoted on the Spirit Earnings Call listen here as saying: “Well, we haven’t talked about capacity for 2022 yet. I mean, you could use, sort of fleet growth as a proxy for that. We have our fleet numbers out there. We have – we’ve grown the airline, 16 aircraft last year, will grow at 16 this year, and 17 in 2022. So you can sort of do the proxy for capacity. But we haven’t given a number yet.”


American Weighs Return To Debt Markets | Will This Effect Bankruptcy?


  • American Airlines Group Inc. is weighing a return to the debt market as soon as March to help pay back loans from the U.S. government that have helped keep the company afloat through the pandemic.
  • Goldman Sachs Group Inc., which last year helped United Airlines Holdings Inc. use its frequent-flier program to backstop new debt, is sounding out potential credit investors in a debt deal for American, according to people familiar with the matter. American, which backed a $7.5 billion U.S. Treasury loan with its frequent-flier program, is considering doing the same with its new debt, said the people, who asked not to be named because the matter is private. Terms are still fluid and could change, they said.
  • The airline, which borrowed under both the government’s payroll support program and a rescue lending package for carriers, is still deciding which of its government debt will be paid off in the refinancing, some of the people said.
  • American got another boost recently after its stock was swept up in a rally among heavily shorted equities being targeted by an army of traders on Reddit’s Wall Street Bets forum — jumping as much as 31% during a trading session last month. Amid the trading frenzy, the airline announced plans to sell up to $1.1 billion of shares.
  • American’s AAdvantage loyalty program has an assessed value of $18 billion to $30 billion, American said in May, when it was negotiating with the Treasury Department to use at least part of the asset as collateral for the loans.


Bastian Blasts Biden | Calls Negative Test Requirement “A Horrible Idea”


  • Rumors began circulating last week that the White House might begin requiring a negative test for travelers looking to fly domestically within the U.S.
  • Shortly after these rumors began circulating, Delta CEO Ed Bastian was on CNN discussing why this would be a horrible idea.
  • The White House said on Friday it was not planning to require people to take COVID-19 tests before domestic airline flights after the prospect of new rules raised serious concerns among U.S. airlines, unions and some lawmakers.
  • Late on Friday, a spokeswoman for the Centers for Disease Control and Prevention said, “at this time, CDC is not recommending required point of departure testing for domestic travel.” She added the CDC “will continue to review public health options for containing and mitigating spread of COVID-19 in the travel space.”
  • CDC said last month the agency was “actively looking” at expanding mandatory COVID-19 testing to U.S. domestic flights.
  • Psaki spoke after the chief executives of major U.S. airlines, including American Airlines, Southwest Airlines and United Airlines, met virtually with White House COVID-19 response coordinator Jeff Zients.
  • Southwest Airlines warned such a requirement could put jobs at risk and a major aviation union said it could lead to airline bankruptcies.
  • One idea that has been under serious consideration is for the CDC to issue recommendations advising against travel to specific areas of the United States with high COVID-19 case loads, although those travel recommendations would not be binding, officials said.
  • The CDC currently has a broad recommendation discouraging all nonessential air travel.


Weekly TSA Numbers

Feb 16 2021 TSA Numbers