United, American Announce Layoffs
N E W Y O R K, Sept. 20 -- The cutbacks just keep on coming, while the government aid package for the airlines seems to keep getting smaller.
American Airlines and United Airlines, the two largest carriers in the United States, announced Wednesday that they will each lay off 20,000 employees — a direct response to last week's terror attacks, in which four planes were hijacked and crashed in New York, Washington and Pennsylvania. Two of the hijacked planes were United flights; the other two were American.
That brings the industrywide number of announced layoffs to about 70,000 since Sept. 12, the day after the attacks. Continental Airlines and US Airways are among the carriers that have also have announced layoffs.
The ripple effect is also reaching overseas. British Airways, Europe's largest airline, said today that it was laying off 12.5 percent of its work force, grounding 20 aircraft and reducing flights by 10 percent in the wake of attacks on the United States.
The airline, which relies heavily on transatlantic business, said it would cut a further 5,200 jobs, in addition to 1,800 already announced this month. British Airways's stock has fallen 42 percent since the eve of the September 11 attacks.
Airline Aid Package Could Be $5 Billion
Meanwhile, in ongoing negotiations late Wednesday evening, the Bush administration has reduced its bailout offer for the airline industry to $5 billion in immediate cash, rather than a $17.5 billion cash-and-loan package.
White House negotiators and congressional leaders met on Capitol Hill Wednesday night to discuss the terms of the package, but the Bush administration has withdrawn its support for $12.5 billion in loan guarantees sought by industry leaders.
The White House will also offer $3 billion in emergency funds already approved by Congress to pay for security improvements.
House leaders had originally suggested a $15 billion package, while airline executives have publicly called for $24 billion in aid. The Bush administration and the House appeared close to agreement on the $17.5 billion figure Wednesday night, but now seem likely to back the smaller measure.
