As the U.S. waits for Congress to decide on additional coronavirus economic stimulus, airline industry employees are at risk of being let go, former Spirit Airlines CEO Ben Baldanza told “The Fox News Rundown" podcast.
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Baldanza said airlines have been encouraging employees to voluntarily step away from work without pay to minimize the number of people furloughed or laid off. But as the industry demands fewer employees as a result of the pandemic, workers will be forced out of a job.
“That’s why I think it's so important that Congress act appropriately to support business,” he said. “And I think a re-up of the CARES money, as it relates to airline employees, makes a lot of sense.”
According to Baldanza, some international airlines are at risk of going out of business as some countries continue to restrict travel. Since the outbreak, more than 900 planes worldwide have been “retired and rejected,” he said.
But within the United States, Baldanza said, airlines are “pretty strong” financially from eight to 10 years of good profitability and cash management.
“I think that airlines in the U.S. are doing the right things around managing their cash, getting good sources of liquidity, flying the amount of capacity that can generate more cash and reducing costs that aren't needed to spend right now,” he said. “So unless the demand shortfall lasts years and years and years longer than people expect, I think the U.S. airlines are probably in shape to not have to file bankruptcy or go out of business.”
Baldanza said he’s most concerned for long haul travel since fewer people are traveling to far-off destinations and the planes are most expensive to service.
“Airlines like Delta, United, American that fly those kinds of planes for part of their service, or an airline like Emirates or Singapore, where most of their services are like that, are going to have the biggest challenge here,” he said.
Baldanza added that contracting the coronavirus is not any easier on a plane than anywhere else due to airflow – a narrative that he said needs “fixing.”
“Airlines, I think, need to do a better job of explaining the way air really moves on the airplane and how it is refreshed regularly throughout the flight,” he said. “So while you're on that plane for four to six hours, you're probably safer in terms of getting virus transmission than almost anything else you would do other than just maybe staying at home.”