American Airlines CEO Doug Parker is set to tell a US Senate committee on Wednesday that the $54 billion airlines have received from the federal government in COVID-19 relief has been spent properly and helped save the fate of American carriers.
The three rounds of grants and loans “saved the airline industry,” Parker will tell the committee in prepared remarks seen by Reuters News Service.
Parker, United Airlines CEO Scott Kirby, Southwest CEO Gary Kelly and Delta’s chief operating officer are also scheduled to appear before the Senate on Dec. 15.
Airlines have come under intense scrutiny from both sides of Congress after a series of massive delays and cancellations this year, largely due to staffing shortages.
Congress is asking where the money went since the $54 billion was earmarked for payroll support to keep employees and maintain airlines during the pandemic. At some point in April 2020, airlines experienced a day in which aircraft capacity dropped to just 5% of what it was on the same day in 2019. There were numerous reports of flights carrying less than 10 passengers at a time.
Most airlines have improved grants and loans by also offering buyouts and early retirement to employees. But that left carriers shorthanded when pent-up demand for travel exploded earlier this year, and staffing became an issue.
According to Reuters’ review of Parker’s testimony, the US CEO will tell committee members that had the government not intervened, the industry “would only have survived by stopping flights in April 2020, putting almost all of our furloughed and pending teams are asking to get back to levels strong enough to warrant restoring flight. Turns out that would have taken some time in 2021.”