US sees airline loyalty assets as possible collateral

The US Treasury Department is in talks with some airlines about accepting their loyalty programs as collateral against govt loans to help them weather the coronavirus crisis. Other assets are also in play, including some international flight routes, planes, engines, airport gates and spare parts, according to people familiar with the negotiations. Applications are due Friday for the US$25b loan program, the second round of US funds made available to airlines. The people didn’t name the airlines. Airlines are among the industries hardest hit by the spread of the coronavirus and related govt restrictions on travel. Passenger traffic in the US has dropped to 5% of what it was a year earlier, and carriers have slashed flying capacity by as much as 90%. <br/>