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American Airlines lost nearly $9 billion amid pandemic

American Airlines lost nearly $9 billion amid pandemic
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American Airlines on Thursday reported a net loss of $8.9 billion for 2020 attributed to the lack of travel during the coronavirus pandemic.

The airline also had a net loss of $2.2 billion in the fourth quarter of the year, and revenue was down 64 percent compared to the last three months of 2019.

“Our fourth-quarter financial results close out the most challenging year in our company’s history,” American Airlines CEO Doug Parker said in a statement. 

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Parker noted, however, that American Airlines flew more customers than any other airline in 2020 and reduced its daily cash burn rate to about $30 million in the fourth quarter, down from nearly $100 million in April. 

Parker also expressed confidence in the company’s recovery this year. 

“As we look to the year ahead, 2021 will be a year of recovery. While we don’t know exactly when passenger demand will return, as vaccine distribution takes hold and travel restrictions are lifted, we will be ready. We are confident that the actions we have taken to improve our customer experience, enhance our network and increase our efficiency position us well for the future,” Parker said. 

American Airlines said it secured about $9 billion in financial assistance through both rounds of the airline Payroll Support Program (PSP), which was included in the CARES Act last March and again in the coronavirus relief package at the end of 2020.

The airline also said all furloughed employees had their pay and benefits reinstated because PSP was renewed in the December package through the end of March. Initially, 19,000 American Airline employees were furloughed last year during stalled negotiations in Congress over the latest relief package.