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Delta Air Lines, Inc. (DAL) - $25 value - yours FREE >>
United Airlines Holdings Inc (UAL) - $25 value - yours FREE >>
JetBlue Airways Corporation (JBLU) - $25 value - yours FREE >>
American Airlines Group Inc. (AAL) - $25 value - yours FREE >>
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American Airlines to Ask for Coronavirus Fund: Hopes for $12B Aid
In a bid to bolster its financial position in the face of the coronavirus-induced dwindling air-travel demand, American Airlines (AAL - Free Report) decided to apply for the government stimulus package. The $2-trillion relief package (comprising $50 billion for passenger airlines) was legalized by President Donald Trump on Mar 27 after being passed by the Senate and the House of Representatives.
American Airlines will apply for the $12-billion sum in the rescue package that it is eligible for. Of the whole amount, $6 billion will be in payroll grants and the remaining amount will be via loans. Through this decision, the carrier ensured to protect its employees’ jobs and payroll through Sep 30. The government aid apart, American Airlines recently secured a $1-billion loan.
Moreover, the carrier is offering partial pay to its employees. In another coronavirus-related measure, the company decided to waive change fees for travel through May 31. Also, due to the sharp drop in demand, American Airlines aims to reduce domestic capacity in the 60-70% range for April and between 70-80% for May. International capacity is aimed to be cut between 80-90% for both summer months.
Other carriers, namely Delta Air Lines (DAL - Free Report) , United Airlines (UAL - Free Report) and JetBlue Airways (JBLU - Free Report) also slashed capacity in the wake of dwindling demand due to the prevalent global health hazard.
Zacks Rank
American Airlines carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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