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America's New War: Airline Industry Making Case

Aired September 18, 2001 - 15:26   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
AARON BROWN, CNN ANCHOR: Earlier today representatives of the airline industry were at the White House meeting with the administration, making their case that they need federal help. They need money or they're in trouble. They've been hammered by the tragedy of a week ago.

CNN's Patty Davis covers the airline industry and has been developing some information on how bad it is, at least at one airline -- Patty.

PATTY DAVIS, CNN CORRESPONDENT: Well, sources familiar with the company, Aaron, say that United Airlines will be the next to announce job cuts. As early as this week United expected to announce 20 thousand job cuts, and that would be the largest amount of any airline announced so far. Of course, United is one of the airlines that lost two airplanes to -- in the hijackings last week.

Now, this comes on top of other bad news, of other layoffs from other carriers. Over the weekend Continental saying that it would furlough 12 thousand employees. US Airways yesterday saying 11 thousand employees were going to lose their jobs. And sources tell me that we're also expecting job cuts from American as well as Northwest to be announced later this week.

Now, the industry as a whole is saying that it could see some 100 thousand layoffs overall. It says that it's lost some $5 billion just since the hijackings one week ago.

A beleaguered industry, as you said, on Capitol Hill today, as well as the Transportation Department, also at the White House, appealing to those -- to Congress, the executive branch for some kind of relief. The industry says it needs some $24 billion so that it doesn't go under. And sources telling me that, indeed, if they don't get some help by Christmas -- we could see bankruptcies in a matter of days, actually, definitely within a matter of months. If not any help by Christmas, the entire industry could be insolvent -- Aaron.

BROWN: Are they -- on industries -- I'm sorry, on airlines that could declare bankruptcy shortly, do we have names? Do we have -- what do they have in common? They're smaller?

DAVIS: Well, we know -- we already know some of the carriers that have been in a precarious financial situation, one being US Airways. It was trying to do a merger with United, that wasn't able to go through. And they've made it clear that they're in a precarious financial situation, although they haven't put out warnings that they are going to be declaring bankruptcy anytime soon.

But overall, the industry is saying that even the strongest carriers are going to go under by the end of the year if they don't get some help here. They have no revenue coming in, at least the days that the -- ground traffic was halted completely. It's trickling back. We're seeing a lot less traffic, a lot less passengers willing to fly at this point. And so the industry is dearly worried of major problems ahead if they don't have some kind of help from the government -- Aaron.

BROWN: Patty, thank you. Patty Davis.

The chairman of Delta Airlines told us yesterday his planes are flying about half -- with half the passenger load that they had had before.

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