{"id":101154,"date":"2020-10-06T23:06:43","date_gmt":"2020-10-06T23:06:43","guid":{"rendered":"https:\/?p=101154"},"modified":"2020-10-06T23:06:46","modified_gmt":"2020-10-06T23:06:46","slug":"airlines-warn-of-more-bankruptcies-as-government-aid-expires","status":"publish","type":"post","link":"https:\/\/aviacionaldia.com\/en\/2020\/10\/airlines-warn-of-more-bankruptcies-as-government-aid-expires.html","title":{"rendered":"Airlines warn of more bankruptcies as government aid expires."},"content":{"rendered":"\n

Global airlines warned on Tuesday that the coronavirus-stricken industry was on course to burn through another $77 billion in cash in the second half of 2020, calling on governments to renew expiring wage support programmes, reported Reuters<\/a>.<\/p>\n\n\n\n

See also: <\/strong>IATA lowers its forecast for 2020 after a disastrous summer.<\/a><\/p>\n\n\n\n

\u201cThe issue now is that aid, particularly the wage subsidies, is starting to be withdrawn,\u201d Brian Pearce, chief economist at the International Air Transport Association (IATA), told reporters.<\/p>\n\n\n\n

See also:<\/strong> IATA confirms that its annual meeting will be held virtually in November.<\/a><\/p>\n\n\n\n

Airlines consumed $51 billion in cash in the second quarter as the pandemic brought global travel to a near-standstill, the industry body said.<\/p>\n\n\n\n

The call for increased support came as U.S. airlines begin furloughs of more than 32,000 workers amid fading hopes for a new federal bailout package. Wage support programmes are also tapering off in Europe and elsewhere.<\/p>\n\n\n\n

Whereas the withdrawal of subsidies makes sense for sectors in recovery, IATA warned of further airline bankruptcies in the northern hemisphere winter as the collapse in revenue continues to dwarf cost savings. The average carrier now has cash for 8.5 months of operations, Pearce said.<\/p>\n\n\n\n

\u201cWe\u2019re facing some tough winter months for airlines when cash flows are always seasonally weak,\u201d he said. \u201cWe\u2019re looking (at) airlines getting into trouble if not failing without either further government support or (being) able to access capital markets for more cash.\u201d<\/p>\n\n\n\n

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