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American, Delta, United among first applicants for coronavirus aid

April 03, 2020
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3 min read
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American, Delta, United among first applicants for coronavirus aid
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Many U.S. airlines submitted applications for the $25 billion in grants available to airlines under the government's CARES Act that aims to offset some of the economic toll the novel coronavirus pandemic has taken on the industry.

Alaska Airlines, American Airlines, regional Cape Air, Delta Air Lines, Hawaiian Airlines, JetBlue Airways, Southwest Airlines, Spirit Airlines and United Airlines were among the first to apply for the funds that can be used for employee payroll and benefits on Friday, the companies confirmed. None of the airlines indicated whether they had applied for the $25 billion in loans that are also available from the government.

"This law keeps paychecks coming and it buys us time," JetBlue CEO Robin Hayes told staff in a memo Friday. "Securing jobs, even at reduced total pay, is my priority right now."

Get Coronavirus travel updates. Stay on top of industry impacts, flight cancellations, and more.

Airlines around the world are digging into their savings accounts the number of people flying falls to near zero. The International Air Transport Association (IATA) has warned of a cash crunch that could prompt the collapse of half of the world's carriers if governments do not intervene.

JetBlue is burning around $10 million in cash a day and Delta roughly $60 million the airlines have said. Both have cut capacity by at least 70% in April to slow the bleeding, and sought new debt from lenders to bolster balance sheets.

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For U.S. airlines, the CARES Act funds are a "game extender," as Evercore analyst Duane Pfennigwerth put it in March. The grants are earmarked for non-executive compensation while the loans can be used for other fixed costs. All of the funds come with strings, including barring involuntary furloughs through Sept. 30, requiring that air service continues across the country, and limiting investor returns and executive compensation.

Related: Airlines will have to meet these schedule requirements to get coronavirus aid

Delta CEO Ed Bastian, in his own communique to staff Friday, said the airline is flying roughly 6% of the number of passengers that it flew this time last year. He warned that they "still haven't seen the bottom."

The CARES Act "funds alone are not nearly enough. We are expecting our revenue in the second quarter to be down 90 percent," said Bastian.

The government had set an initial deadline of 5 p.m. ET on Friday for airlines to submit their earliest round of grant requests.

Related: What you need to know about the $50B coronavirus aid package to airlines

Updated with comments from Alaska Airlines, Hawaiian Airlines, Spirit Airlines and Southwest Airlines.

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  • Intro Offer

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  • Annual Fee

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  • Recommended Credit

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Why We Chose It

There’s a lot to love about the Amex Gold. It’s a fan favorite thanks to its fantastic bonus-earning rates at restaurants worldwide and at U.S. supermarkets. If you’re hitting the skies soon, you’ll also earn bonus Membership Rewards points on travel. Paired with up to $120 in Uber Cash annually (for U.S. Uber rides or Uber Eats orders, card must be added to Uber app and you can redeem with any Amex card), up to $120 in annual dining statement credits to be used with eligible partners, an up to $84 Dunkin’ credit each year at U.S. Dunkin Donuts and an up to $100 Resy credit annually, there’s no reason that foodies shouldn’t add the Amex Gold to their wallet. These benefits alone are worth more than $400, which offsets the $325 annual fee on the Amex Gold card. Enrollment is required for select benefits. (Partner offer)

Pros

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  • 3 points per dollar spent on flights booked directly with the airline or with amextravel.com
  • Packed with credits foodies will enjoy
  • Solid welcome bonus

Cons

  • Not as useful for those living outside the U.S.
  • Some may have trouble using Uber and other dining credits
  • You may be eligible for as high as 100,000 Membership Rewards® Points after you spend $6,000 in eligible purchases on your new Card in your first 6 months of Card Membership. Welcome offers vary and you may not be eligible for an offer. Apply to know if you’re approved and find out your exact welcome offer amount – all with no credit score impact. If you’re approved and choose to accept the Card, your score may be impacted.
  • Earn 4X Membership Rewards® points per dollar spent on purchases at restaurants worldwide, on up to $50,000 in purchases per calendar year, then 1X points for the rest of the year.
  • Earn 4X Membership Rewards® points per dollar spent at US supermarkets, on up to $25,000 in purchases per calendar year, then 1X points for the rest of the year.
  • Earn 3X Membership Rewards® points per dollar spent on flights booked directly with airlines or on AmexTravel.com.
  • Earn 2X Membership Rewards® points per dollar spent on prepaid hotels and other eligible purchases booked on AmexTravel.com.
  • Earn 1X Membership Rewards® point per dollar spent on all other eligible purchases.
  • $120 Uber Cash on Gold: Add your Gold Card to your Uber account and get $10 in Uber Cash each month to use on orders and rides in the U.S. when you select an American Express Card for your transaction. That’s up to $120 Uber Cash annually. Plus, after using your Uber Cash, use your Card to earn 4X Membership Rewards® points for Uber Eats purchases made with restaurants or U.S. supermarkets. Point caps and terms apply.
  • $84 Dunkin' Credit: With the $84 Dunkin' Credit, you can earn up to $7 in monthly statement credits after you enroll and pay with the American Express® Gold Card at U.S. Dunkin' locations. Enrollment is required to receive this benefit.
  • $100 Resy Credit: Get up to $100 in statement credits each calendar year after you pay with the American Express® Gold Card to dine at U.S. Resy restaurants or make other eligible Resy purchases. That's up to $50 in statement credits semi-annually. Enrollment required.
  • $120 Dining Credit: Satisfy your cravings, sweet or savory, with the $120 Dining Credit. Earn up to $10 in statement credits monthly when you pay with the American Express® Gold Card at Grubhub, The Cheesecake Factory, Goldbelly, Wine.com, and Five Guys. Enrollment required.
  • Explore over 1,000 upscale hotels worldwide with The Hotel Collection and receive a $100 credit towards eligible charges* with every booking of two nights or more through AmexTravel.com. *Eligible charges vary by property.
  • No Foreign Transaction Fees.
  • Annual Fee is $325.
  • Terms Apply.