U.S. airlines have yet to tap $29 billion in federal pandemic relief loans as they wait to see whether the reopening of the economy revives demand and diminishes the need for money that comes with government strings attached.
Although the four largest U.S. passenger airlines have applied for the Treasury Department program, only American Airlines has said it intends to dip into the pool of funds.
Southwest Airlines, United and Delta Air Lines said they plan to wait until fall before deciding whether to take the money — after a summer travel season that could see more people return to the skies.
The wait-and-see approach illustrates how airlines are preparing for an uncertain future amid early signs of a recovery after Americans all but stopped flying in April due to the coronavirus and travel restrictions.
A second wave of infections could make the situation worse.
It also highlights how only a small portion of hundreds of billions of dollars available to the Treasury Department actually has been doled out to help companies.
“That pool of money is designed as backstop financing and for those who can’t raise money elsewhere,” said Helane Becker, an analyst at Cowen and Co. in New York.
U.S. airlines separately have raised billions in capital through methods including secured loans, bond offerings and equity sales, and Becker said that the federal loans are a last resort.