United CEO Seeking for a Second Bailout

US Airline

United Airlines CEO Scott Kirby is visiting Washington D.C. lobby Congressional leader to grant a second bailout for the airline industry.

This news came out via aviation blog Live and Let’s fly. However, there was a video message by Kirby to United. In the message, he told his plans. And said that they can avoid further layoffs in October if the Congress passes, and the President signs, an extension of payroll support.

However, in March the airlines received about $25 billion in grants and loans. It was the first stimulus package the government gave the airlines to help them cope up during the coronavirus pandemic and make their financial position better.

“And what’s clear now is that the coronavirus crisis is still with us and is not going to end anytime soon. And so, the only way that we’re going to avoid the involuntary furloughs on October 1st, at this point, is an extension of the Payroll Support Program,” Kirby said.

But even if it doesn’t happen and right now legislators are in a political stalemate, Kirby said United will remain viable.

Extreme caution by United

“To be clear, United is taking the difficult steps to make sure that we can survive. Regardless of what happens with the legislation in Washington, D.C., We’ve raised $16 billion of capital. We’ve cut all of our expenses to the bone.”

“But unfortunately, we’ve also been pretty accurate about what’s going to happen with demand. And we’ve been worried that the coronavirus was going to cause a larger dip in demand than a lot of others thought. That’s why we are matching our schedule to demand and flew less than some others,” Kirby said in the video.

“But it’s been, unfortunately, accurate that the coronavirus has had a bigger impact. And it’s increasingly clear now to us that we’re not going to get back to anything close to normal until a vaccine is not only available. But is effective, it’s manufactured, and it’s widely distributed to the entire population.”

“We have positioned United to survive. But what that means is, unfortunately, we’re going to have to be a much smaller airline during that. And that’s the reason sent out 36,000 WARN notices. But there is a better answer.”

Layoff Notices

Previously, United Airlines announced that it will be sending layoff notices to about 36,000 of its US employees. This will be nearly half of the airline’s US staff.

The staff affected by this decision include 15,000 flight attendants, 11,000 customers service, and gate agents. Moreover, there will be 5,500 maintenance workers and 2,250 pilots. The airline will start implementing these layoffs as early as 1 October.

However, other than the staff cuts. United Airlines also plans to reduce its management and support staff by 1,300 starting from 1 October. Moreover, the airline will be reducing its international staff as well. United employs 95,000 people.

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