Airline CEOs face Senate panel over flight cancellations after receiving $54 billion in taxpayer aid

Airline executives will face questions from a Senate panel on Wednesday about flight disruptions and staffing shortages despite their $54 billion in taxpayer aid to help cover labor costs during the pandemic of air travel.

The executives of American Airlines, United Airlines, Southwest Airlines and Delta’s chief operating officer will say the aid has helped them survive the crisis and that they are currently ramping up hiring, according to written testimony to a Senate Committee on Commerce hearing. , Science and Transportation.

Committee members are likely to ask airlines how they are preparing for the coming months and about pending customer refunds, which has been a major complaint from travellers.

“While we have seen steady travel across the United States, the Omicron variant of COVID has demonstrated the continued volatility of the pandemic,” Delta chief executive John Laughter said in written testimony. document.

US airlines posted a record $35 billion in losses last year but executives say the Paycheck Assistance Program, which prohibits them from laying off workers, bridges them to a time when demand goes. back by plane began to recover.

“It is no exaggeration to say that the program has saved the airline industry, which Congress and administration have recognized as critical infrastructure needed for the economy because it is unique,” ​​said American CEO. Doug Parker wrote in his testimony.

Southwest CEO Gary Kelly said of the payroll assistance program: “I can summarize PSP in two words: IT WORKS,” according to his written testimony given before the arrest hearing. start at 2:30 p.m. ET.

While airlines accepting the aid were unable to lay off workers, they have significantly reduced headcount by urging employees to take voluntary measures such as purchasing, laying off or laying off workers. take a temporary leave of absence in exchange for a pay cut.

The staffing shortage exacerbates routine problems, such as bad weather, and contributed to hundreds of flight cancellations as travel demand soars this year. Airlines say they are adding staff as quickly as possible to meet soaring demand.

At Dallas-based Southwest, 15,200 workers, or 25% of the company’s employees, have accepted a voluntary program, with 4,500 of them leaving the company permanently. The company now aims to hire 8,000 employees by 2022 out of 5,000 new employees this year.

American says its hiring target is 18,000 next year after adding 16,000 in 2021.

About 17,000 Delta employees have received purchase packages and 40,000 volunteers have temporarily quit their jobs. So far this year, it has added 8,700 employees, some of whom start at lower salaries than the more experienced employees who chose to acquire.

CEO Ed Bastian said in a quarterly call on October 13. “We’re getting a seniority bonus as we bring in a whole new generation of employees at every level of the company. “, CEO Ed Bastian said on the October 13 quarterly call. “We had almost 20,000 retirees last year, so in the end … many of our most experienced employees picked up. retirement and that opens up opportunities for younger people.” Bastian said the company hasn’t changed its pay scale.

United Airlines, along with Delta, has been more cautious about bringing flights back than American and Southwest.

Chief Executive Officer Scott Kirby said: “After significantly cutting our flight schedule at the start of the pandemic, we know it will be very difficult to get all flights back at the same time, so we decided to add more flights from time to time.” “While this choice sacrificed short-term profitability, it allowed us to guarantee a reliable service and largely avoid the common operational challenges faced by other service providers.” experience.”