U.S. Treasury Agrees On Loan Terms With Five Airlines
1 Five airlines have agreed to terms with the Treasury to secure loans under the CARES Act, led by American Airlines agreeing to a $4.75 billion loan from the federal government. Other airlines that agreed on terms to receive the loan are Frontier, Hawaiian, SkyWest and Spirit.
The loan is great news for Spirit which had previously planned to require all cabin crew to bring pastries on-board and have a bake sale on each flight to raise operating revenue. That deal was nixed when flight attendants wanted to charge a “sugar processing fee” of $2.99 for each baked good.
The Treasury Department did not provide details of the loan term; only stating the borrowers are required to provide warrants — which are financial instruments that can be changed into shares, — other forms of debt, or equity. The airlines also must comply with conditions such as maintaining employment levels and not paying employees above certain thresholds, along with suspension of dividend payments and buybacks.
This list is not final as other airlines my attempt to come to terms on a loan as well. Pan Am, however, will not be one of those airlines. Its effort to get a loan was denied after much scrutiny once the Treasury discovered the airline went out of business years ago, and this was just a Nigerian prince trying to get some cash.
UK to Partially Remove 14-Day Quarantine Requirement
2 The UK government confirmed that passengers entering England from a list of more than 50 countries will no longer be required to self-isolate for 14 days. The order goes into effect on July 10.
The list of nations includes France, Germany, Italy and Spain but does not include the coronavirus capital of the world… the United States.
Scotland, Northern Ireland, and Wales will make their own decisions on when they will drop their respective quarantine restrictions. When that happens, they may still decide to leave the quarantine in place for those coming from England anyway, but this will be unrelated to the coronavirus.
Aeroflot Still Operating to the U.S. — Just Don’t Tell Anyone
3 Aeroflot has found a way around Russia’s travel ban due to the virus that makes perfect sense — you can’t punish an airline for doing something illegal if you don’t know it’s happening. The airline is selling seats to passengers on flights designated as cargo-only. It’s a lot like fight club — either you know about it, or you don’t.
Amazingly, Aeroflot has been operating flights to New York/JFK, Paris, London/Heathrow, Frankfurt, Seoul, and Tel Aviv since at least early June. The flights are officially registered as cargo, but tickets are sold to passengers who know about them and can give the secret hand signal to Aeroflot agents at the airport.
“It is noted that these exclusive flights are not publicized and passengers learn about ticket sales through the grapevine,” Russian daily business Vedomosti reported.
Despite being spotted on several of the flights in the last couple weeks, neither Matthew Rhys or Keri Russell had any comment.
Virgin Group to Inject $250 Million into Virgin Atlantic
4 Richard Branson is pumping $249 million into Virgin Atlantic to help the airline survive the drop in demand for air travel due to the virus.
The cash was funded with the proceeds of Branson selling $500 million of shares in his space tourism boondoggle Virgin Galactic, and it is a part of a $1.1 billion rescue package for the airline.
$500 million of the rescue package had already been agreed upon by the airline and its two shareholders — Virgin Group and Delta.
Some of the package comes from savings from the two shareholders — Virgin is waiving the $25 million fee it charges the airline to license its name and image, while Delta is not charging Virgin Atlantic for its use of Delta’s IT and ticket systems. Delta has also agreed to accept future payments from Virgin Atlantic in the form of Biscoffs and Woodford Reserve.
American to Move Heathrow Operations to Terminal 5
5 Effective tomorrow, July 7, American Airlines is moving its operation at London/Heathrow to the monstrosity known as Terminal 5.
We asked American if this was a permanent move or just for this summer and the airline, through a spokesperson, gave the following statement which totally cleared things up:
“In response to your question, while the move has been driven by terminal consolidation measures, relocating our operations into Terminal 5 will be greatly beneficial for our customers. As air traffic movements increase, American Airlines, British Airways and Heathrow Airport will seek to agree a bilateral future operational strategy for Terminal 5.”
Ok then.
For more information on the subject, feel free to search for this topic on the internet by coming to a bilateral agreement with Google by which you request information on American Airlines and they agree to find the information via their search engine. As the number of results increase, Google will agree to return the information in a timely manner via a list that allows you, the consumer to disseminate it as you please.
Airline Potpourri
- Air India, along with other Indian airlines, is suspending international service through July 31.
- Alitalia officially relaunched as a new company last week, with new management and a new company name — Alitalia-Tai. Don’t worry, branding will still be just Alitalia. As with the old Alitalia, some of its flights might be on-time.
- Azul plans to operate 303 daily departures to 80 cities by the end of August — 35% of its pre-virus operation.
- Emirates SkyCargo expanded its cargo operation to 100 destinations.
- Lufthansa has resumed selling first class tickets.
- Royal Air Maroc will lay off 858 employees and remove 20 aircraft.
- South African Airways is in further trouble as the South African government reaffirmed that it had no intention of doling out more public funds to the bankrupt state-owned carrier.
- TAP will see the Portuguese government as its majority shareholder after the government acquired 22.5% of the airline from shareholder David Neeleman.
- United received permission to conduct charter flights to India.
Andrew’s Moment of Levity
A friend asked me what was my favorite time of the day? I said “6:30, hands down.”