US airlines have reached preliminary deals with the US Treasury Department to access billions of dollars in aid.
A statement released by the US Treasury said that the funding covers “all major airlines”.
American Airlines said it would get $5.8 billion in support, while Delta Air Lines said it would receive $5.4 billion.
In a message to employees, Delta Chief Executive Ed Bastian said: “This is an essential step, but just one of many that will get us through the next several months.
“The funding, along with self-help measures we have taken, will prevent furloughs and pay rate reductions through the end of September, despite the 95 per cent drop we’ve seen in passenger traffic.”
According to the US Treasury companies receiving assistance include United Airlines, Southwest Airlines, Alaska Air, Allegiant Airlines, Frontier Airlines, Hawaiian Airlines and SkyWest.
The programme “will support American workers and help preserve the strategic importance of the airline industry while allowing for appropriate compensation to the taxpayers,” Treasury Secretary Steven Mnuchin said in the statement.
While the funds will allow 750,000 airline employees to stay on payrolls through September, it is only the first step in “a long path to recovery,” according to Airlines for America.
American’s package includes a payroll grant of $4.1 billion and a loan of $1.7 billion. The company said it would disclose warrants for the government in a subsequent regulatory filing. The carrier said it also will seek a separate $4.75 billion loan from the Treasury.
American said it would further reduce its flight schedule for June and beyond. About 32,000 employees have chosen to retire early, accept reduced work or take leave, and the Fort Worth, Texas-based airline will re-open opportunities for more to do the same as it seeks to use the government aid to survive the collapse of air travel.
In a message to employees American CEO Doug Parker and President Robert Isom said: “With this level of assistance, we now believe we have the financial resources necessary to help us withstand this crisis and be in position to serve the traveling public when they are ready to start flying again.”
