The US Treasury Secretary’s warning has caused concerns about mass bankruptcy and called emergency relief from global airlines.
On March 17, US Treasury Secretary Steven Mnuchin warned that the threat from the epidemic of COVID-19 to the aviation industry was larger than the September 11 in 2001 terrorist attack. This event caused the US aviation industry to completely stopped.
This warning has caused concerns about mass bankruptcy and called emergency relief from global airlines.
The Italian government said they would take over Alitalia, the airline has negotiated bankruptcy since 2017.
Deputy Economy Minister Laura Castelli said the takeover decision came from the difficulties of people who return to the country at the present time.
Meanwhile, Sweden and Denmark on March 17 announced to grant 275 million euros (the US $ 300 million) to guarantee loans for SAS, becoming the country that will soon support this industry.
In the US, airlines have asked the government for $ 50 billion in guarantees and loans, along with tens of billions of dollars in tax breaks, as the White House prepares a plan to support the entire economy.
In a statement, the aircraft maker Boeing said that the long-term prospects of the aviation industry remain positive, but until global passenger transportation returns to normal, these measures are necessary to limit pressure on the aviation industry as well as the whole economy.
Australia on March 18 joined the ever-growing list of countries that provide financial support to the aviation industry when global airlines announced they would continue to cut down capacity, due to the sharp decline in demand and controlling border measures to prevent the spread of COVID-19.
The Australian aviation industry will receive a government bailout of AUD 715 million (the US $ 490.5 million) to cope with the COVID-19 crisis.
The package includes a series of tax exemptions on aviation fuel consumption, domestic aviation service charges, and domestic and foreign aviation security fees.
The International Air Transport Association says that the total support from governments around the globe for airlines can be up to $ 200 billion.
Aviation officials said that most carriers will use up their cash reserves for three months or sooner.
Aviation consulting firm CAPA warned most airlines around the world would go bankrupt by the end of May.
Airlines warned that air transport could be affected by stopping 185,000 flights worldwide.
On March 17, more carriers cut flights as millions of passengers canceled flights to quarantine and countries ban entry to prevent the spread of the disease.
According to Cowen analyst Helane Becker, the aviation industry is on the verge of collapse when governments isolate the majority of the population and close the border to foreigners.
US President Donald Trump said on March 17 that restrictions on domestic travel are being considered, which if it was implemented, it would put additional pressure on this country’s airlines.