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Airline shares dive as Trump spikes stimulus talks

·1-min read
Efforts by airline unions and executives for more payroll support took a hit when President Donald Trump called off stimulus talks
Efforts by airline unions and executives for more payroll support took a hit when President Donald Trump called off stimulus talks

Airline shares tumbled Tuesday after President Donald Trump ended talks with congressional leaders on another fiscal stimulus package until after the November elections.

Shares of major carriers had been in positive territory prior to Trump's statement on Twitter which derailed the talks that had been dragging on for weeks.

The statement appeared to doom the near-term prospects for the additional funding the airlines said was needed to avert more deep industry layoffs.

American Airlines ended with a loss of 4.5 percent, while United Airlines dropped 3.6 percent, Delta Air Lines fell 2.9 percent and Southwest Airlines declined 2.4 percent.

US carriers received billions in aid from Congress in exchange for a promise to refrain from laying off workers, but that pledge was in effect only through October 1.

Though they have sought to minimize layoffs through voluntary work leave and early retirement programs, American and United airlines last week said they would begin furloughing 19,000 and 13,000 workers, while indicating the moves could be walked back if there is a breakthrough in Congress.

Southwest Airlines, meanwhile, has sought to avert layoffs by getting pilots unions to agree to pay cuts.

Delta Air Lines had agreed to not furlough pilots until at least November 1 to give Congress more time to strike a deal.

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