United will wrestle its average daily cash burn down to no more than $45m in Q2 as the carrier braces for a prolonged travel slump due to coronavirus. That would be less than half the amount United was going through in March, as the coronavirus pandemic all but erased travel demand and prompted mass cancellations by customers. Like other airlines, United is trying to ride out the worst crisis in the industry’s history as passenger totals fall more than 90% in the U.S. alone. The company said it had a $9.6b pile of cash and short-term assets as of Wednesday, not including a potential US government loan of $4.5b. United has already lined up $5b in payroll assistance from the Treasury Department to US carriers. United recorded an adjusted loss of $2.57 a share in Q1, a smaller shortfall than the $3.37 average of analyst estimates compiled by Bloomberg. Sales dropped 17% to $7.98b, the carrier said Thursday, affirming preliminary results it released April 20 in a regulatory filing.<br/>
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Germany’s government has set out a unified position on a bailout for Lufthansa, with the airline group expected to accept a significant state stake and veto rights in exchange for a multibillion-euro package of assistance, according to people familiar with the matter. While details are still being negotiated, the economy and finance ministries have ironed out disagreements that dragged on for weeks, the people said, asking not to be named discussing the deliberations. The plan foresees Germany taking a least a 25% stake in the airline and receiving at least one seat on the firm’s supervisory board, the people said. The assistance could run to E10b. The size of Germany’s equity stake, whether part of it will be under a so-called silent participation that limits state control, and how many seats the government will have on Lufthansa’s supervisory board are still subject to negotiations, according to the people. Talks between the airline and the government are expected to stretch into next week, the people said. “The future of Lufthansa is being decided in these days,” Lufthansa CEO Carsten Spohr said, according to the text of a speech to be given at the company’s annual meeting on May 5. “It is about avoiding an insolvency with the help of the governments of our four home markets.”<br/>
Lufthansa pilots represented by trade union Vereinigung Cockpit have offered to waive up to 45% of their salaries for two years, in return for job security, to help the airline navigate the coronavirus crisis. In March, the union and airline agreed short-time working arrangements for pilots – a first in Lufthansa’s history. The target was a 50% reduction in flightcrew costs. But Vereinigung Cockpit says the measure is “not enough” to bring the airline through a “crisis with an uncertain length”. The union says the partial waiving of salaries and an additional reduction of current short-term work pay will together deliver savings of E350m over a two-year term to 30 June 2022. Lufthansa management has met with staff representatives and unions today to discuss the airline’s situation, Vereinigung Cockpit notes. In return, the union demands that Lufthansa Group’s senior executive team is “committed” to employees and does “everything possible to overcome the crisis together with [staff] in a social partnership”. The union asserts that a potential “protective shield” state-aid procedure would not meet those requirements.<br/>
Singapore Airlines shareholders Thursday gave the green light for the carrier to raise up to $15b as the coronavirus pandemic thrusts the travel industry into an unprecedented crisis. The virtual extraordinary general meeting (EGM) saw 99.79% of the votes in favour of resolution one - to raise $8.8b through a 3-for-2 rights issue of shares and a convertible bond issue. The rights issue will comprise up to 1.77b new shares at $3 each, on the basis of three rights shares for every two existing shares. The aim is to raise $5.3b. The issue price represents a discount of about 53.8% to the last transacted price of $6.50 on March 25, while the theoretical ex-rights price will be $4.40. SIA will also raise up to $3.5b via a 10-year mandatory convertible bond (MCB) issue on the basis of 295 rights MCBs for every 100 existing shares. The bonds, which have zero coupon, will be priced at $1 each. <br/>