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Delta, United and different airways enter right into a federal coronavirus mortgage settlement

A Delta Airlines aircraft flies to San Diego International Airport (SAN) in San Diego, California, on Monday, April 27, 2020.

Bing Guan | Bloomberg | Getty Images

Five other airlines have signed billions of federal loans with the Treasury to help airlines tackle the coronavirus pandemic.

Covid-19 has destroyed the demand for air travel and sent US airlines at their first losses in years.

Delta, United, JetBlue, Southwest, and Alaska have signed letters of intent on the terms of the loans, the Treasury said on Tuesday. Last week it was announced that American, Frontier, Hawaiian, SkyWest and Spirit had also signed aid agreements. The CARES Act, a $ 2.2 trillion corona virus support package approved in March, provides for $ 25 billion in loans to US passenger airlines.

Airlines are struggling with corona virus spikes across the country and travel restrictions that threaten demand for flights.

United said last week that demand for a resurgence had "flattened" in the past few weeks.

The Chicago-based airline told employees this week that new Covid 19 cases, as well as quarantine requirements and restrictions such as those set by New York, New Jersey, and Connecticut, are impacting demand. At United's hub in Newark, New Jersey, net bookings at the beginning of the month were down 84% year over year and 73% elsewhere in the US, the airline said.

"The major US airlines play an important role in our economy and are critical to domestic and international travel and commerce," said the Treasury Department. "These airlines are among the companies most affected by the disruption to social and economic activity caused by the pandemic."

The finance department has not released the terms of each potential loan or the amounts, and the agreements do not necessarily mean that carriers will eavesdrop on them. Delta announced in April that it would be eligible for a $ 4.6 billion loan, while United said in May it could access $ 4.5 billion.

Airlines have also received portions of $ 25 billion in payslips that prohibit them from firing or cutting employee wages by September 30.

But airlines like Delta and United recently warned employees that they might receive government-mandated announcements about possible job cuts earlier this month.

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