US airlines continue to bleed cash as wait for stimulus package goes on
US airlines laid out the continued cost of the coronavirus pandemic today as the wait for a new stimulus package from federal authorities went on.
American Airlines fell to a loss of $2.4bn (£1.8bn) in the period from July to September, its third consecutive quarterly loss.
The Texas-headquartered carrier revenue fell 73 per cent compared to last year in the third quarter. The flier pulled in turnover of just $3.2bn in the period.
It added that it burned through $44m of cash a day in the three month period, though it expects to reduce this to $25m-$30m a day in the next.
Meanwhile, Southwest Airlines posted a loss of £1.2bn, ahead of both forecasts and the $1.5bn loss it reported in the prior quarter.
It booked a mere $1.8bn in revenue in the period, half of what it needs to break even on cash flow.
Despite the huge losses, both carriers said that they had sufficient cash to last out the pandemic, with passenger numbers showing no signs of returning.
Shares in American were flat after it said it would issue up to $1bn of equity to further bolster liquidity, while Southwest shares picked up four per cent.
In contrast to other carriers, the airline has been adding to its network recently.
US airlines were on the receiving end of $25bn in grants to help them continue to pay staff, but the funding ran out at the end of September.
A new package for airlines is expected as part of a new package of economic relief, but Congress has yet to agree a deal with the White House.
US House Speaker Nancy Pelosi said negotiators were making progress in talks with the Trump administration and that legislation could be hammered out “pretty soon.”