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Lawmakers, unions press U.S. airlines to hold off on stock buybacks

Stock Markets Sep 28, 2022 07:26PM ET
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3/3 © Reuters. American Airlines passenger planes crowd a runway where they are parked due to flight reductions to slow the spread of coronavirus disease (COVID-19), at Tulsa International Airport in Tulsa, Oklahoma, U.S. March 23, 2020. REUTERS/Nick Oxford/Files 2/3
 
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By David Shepardson

(Reuters) - Labor unions and some U.S. lawmakers are pressing airlines not to resume stock buybacks after a COVID assistance prohibition expires this week.

Representative Peter DeFazio, a Democrat who chairs the House Transportation and Infrastructure Committee, is holding a hearing on Thursday on investing in transportation workers that will discuss the issue.

DeFazio is circulating a letter to colleagues seen by Reuters that urges airlines to "refrain from initiating stock buybacks ... at least until air carriers are able to publish and fulfill schedules that meet demand; staff flights and key personnel positions appropriately; and return service to every community." 

Aviation unions launched a campaign in August to pressure airlines against stock buybacks. It came as major carriers are negotiating new contracts with their pilots, who are asking for higher pay and improvements in schedules.

Sara Nelson, president of the Association of Flight Attendants, is among those will testify at Thursday's House hearing.

"While airlines are just now starting to make a profit, the recovery is not complete and the austerity of twenty years prior has not been corrected for airline jobs," according to Nelson's written testimony seen by Reuters. "We can’t allow CEOs to send one dollar to Wall Street before fixing operational issues and concluding contract negotiations."

Airlines for America, a trade group, said airlines are in full compliance with the payroll assistance program.

The group noted U.S. airlines have been "aggressively hiring across the industry ... to accommodate the rapid return of demand for air travel" and are "making significant investments in new aircraft."

Congress approved $54 billion in three rounds covering much of U.S. airline payroll costs for 18 months through September 2021. Earlier this month, the chairs of two other congressional committees sought a federal probe into whether airlines used payroll funds to fund pilot buyouts and early retirements.

American Airlines (NASDAQ:AAL) received $12.6 billion, Delta Air Lines (NYSE:DAL) $11.9 billion, United Airlines $10.9 billion and Southwest Airlines (NYSE:LUV) $7.2 billion.

Out of $54 billion, airlines must repay $14 billion, or 26.2% of the funding.

Lawmakers, unions press U.S. airlines to hold off on stock buybacks
 

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Comments (1)
James Long
FauxNews Sep 28, 2022 8:05PM ET
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Another socialist government bailout of the airlines and they use the $$ for exec bonuses and stock buybacks at taxpayer expense. Socialism for the big boys and brutal capitalism for the masses. We have a rigged economy.
 
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