U.S. Treasury Secretary Steve Mnuchin stated Friday that taxpayers will “compensated” for providing as much as $25 billion in direct grants to the airline sector.
U.S. airways are preparing to tap the government to cover payroll in a steep travel slowdown sparked by COVID-19, even after the federal government warned it may take stakes in exchange for bailout funds or different financial devices, people conversant in the matter stated.
U.S. Prz Trump stated he would hire “brilliant financial minds” from Wall Street to help in the government’s airline assistance bids.
Under the bill approved by Trump Friday, Mnuchin can demand equity, warrants, or other financial tools to “present appropriate compensation to the federal government.”
The Treasury has an internal working workforce already discussing the way to proceed, people briefed on the matter said. An individual briefed on the matter said Mnuchin is expected to take a tough line with the airlines who had threatened to leave tens of 1000’s of workers without immediate cash.
American Airlines dropped 6%, whereas Southwest Airways slumped 9% and JetBlue Airways plunged 7%.
Boeing has sought at least $60 billion in government loans or guarantees the aerospace industry. Earlier this week, Boeing CEO Dave Calhounstated the company was not interested in giving the government equity in exchange for loans.