Struggling Aviation Industry Meets With Transportation Secretary

Leaders of the nation's beleaguered airline industry met on Tuesday with Transportation Secretary Norman Y. Mineta and sought assurances that the Bush administration is committed to its financial survival.

Mineta said Tuesday that he hoped to have a U.S. airline bailout package ready for Congress by early next week.

Mineta, joined by Delta Air Lines chief executive Leo Mullin after a White House meeting, said the Bush administration had received the necessary information from the industry to proceed with a financial rescue proposal.

He did not say whether that plan would match the $24 billion sought by the industry, which has warned the administration and Congress that it is facing dire financial hardship in the wake of last week's devastating attacks in New York and Washington.

Major airlines are lobbying for the federal bailout package after suffering millions of dollars in losses because of the shutdown and service cutbacks following last week's terrorists attacks. Carriers have announced more than 26,000 layoffs, with some even discussing the possibility of bankruptcy.

Members of Congress have said they will move quickly to assist the troubled airline industry, which had seen many carriers losing money even before the terrorist attacks.

"If we don't act soon, I'm afraid that it will be even more difficult to resuscitate this key industry in the future," Sen. John McCain of Arizona, senior Republican on the Senate Commerce Committee, has said.

The House could pass legislation this providing at least $15 billion in grants and credits to the industry.

Attending the meeting with Mineta were Mullin of Delta; Fred Smith, Federal Express; Don Carty, American Airlines; Richard Anderson, Northwest Airlines; Rakesh Gangwal, US Airways; John Kelly, Alaska Airlines; Jim Goodwin, United Airlines; Gordon Bethune, Continental Airlines; and Carol Hallet, of the industry trade group the Air Transport Association.

On Monday, U.S. Airways announced it would lay off 11,000 employees, or 24 percent of its work force, and drastically cut service. The company said it had no choice because the attacks had reduced passenger demand and prompted expensive new security requirements.

America West Airlines said it would cut about 2,000 jobs and reduce flights by about 20 percent because of the effects the East Coast terror attacks are having on air travel. 

"Absent immediate intervention by the federal government, America West Airlines and its 14,000 employees are at risk because of these tragic occurrences," said W. Douglas Parker, the company's chairman, president and chief executive. 

Other major carriers have trimmed schedules or announced layoffs. Among them is Continental, which laid off 12,000 employees, or 21 percent of its work force, over the weekend.

National Airlines of Las Vegas announced Sunday it was cutting back its operations by 20 percent and laying off 300 workers, leaving it with 1,000 employees. Midway Airlines of North Carolina closed down last week while in the midst of reorganizing its financially troubled business, laying off 1,700 employees. 

An industry group warned that as many as 100,000 airline layoffs are likely in coming weeks.

"We do not believe every airline's survival is guaranteed under any circumstances," said Jim Higgins, analyst at Credit Suisse First Boston in New York. He said the industry will lose at least $5 billion this year.

American Airlines, the nation's largest airline, will announce layoffs later this week, a company official said on condition of anonymity. The exact number will partly depend on the size of the federal bailout, the official said.

American, Continental, Delta, Northwest and United have already scaled back their schedules by 20 percent.

Continental Chief Executive Gordon Bethune on Saturday warned that the airline could file for bankruptcy October without government assistance. As many as 100,000 airline jobs could be lost as all carriers lose mountains of money, a total $1 billion since last week. Other industries would suffer, too, he said. 

Reuters and the Associated Press contributed to this report.