Treasury Secretary Steven Mnuchin said Thursday he plans soon to unveil the rescue plan for the airline industry that has essentially been shut down to help stop the spread of the coronavirus.
“That’s the next big thing we’ll be rolling out,” he told CNBC.
Mnuchin said he plans to update President Trump this afternoon about his analysis of the sector and that he will speak with airline executives over the next few days. He said that the money going to the airlines will not be a bailout.
“It is our objective to make sure … this is not a bailout, but that airlines have the liquidity to keep their workers in place,” he said.
Last month, Trump signed into law a $2.2 trillion coronavirus relief bill that included $25 billion in lending for airlines. Meanwhile, analysis shows that airlines have lost over $250 billion in revenue because of cutbacks in flights because of the virus. Before the crisis, a typical airline had two months of cash available. It is estimated that the airlines will need to refund $35 billion to passengers for canceled flights.
The Federal Reserve earlier on Thursday said it would provide up to $2.3 trillion in loans to bolster the economy by ensuring credit flows to households, small and midsized businesses, and state and local governments, a program jointly enacted with the Treasury Department.
“The Fed’s role is to provide as much relief and stability as we can during this period of constrained economic activity, and our actions today will help ensure that the eventual recovery is as vigorous as possible,” said Federal Reserve Board Chairman Jerome Powell.
Mnuchin referred to this announcement as “big news” and said that the Treasury Department had been “working around the clock with the Federal Reserve” to provide these loans to businesses.
