- Atlas Air, one of the largest US cargo carriers, received $US407 million in government stimulus funding this spring.
- But business at the Amazon contractor, like other logistics companies, boomed amid the pandemic.
- Rep. Jim Clyburn called on Atlas and its peers last month to return the CARES Act funding, half of which is not required to be repaid.
- Atlas executives say the company fully qualified for the money and that it’s been spent on its intended purpose: payroll.
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Atlas Air, a cargo airline which includes Amazon as a major customer and investor, has seen business boom during the COVID-19 pandemic.
Yet this spring, as passenger carriers saw revenues plunge amid travel bans and lockdown orders, the company received $US407 million from the US’ payroll support program. It was the largest amount received by any cargo airline under March’s economic stimulus passed by Congress, only behind major passenger carriers like Delta and United. Just under half â€” $US199,831,979 â€” must be repaid.
Now, with revenue and profits once again nearing record highs above pre-pandemic levels, Democratic Rep. Jim Clyburn says Atlas and other cargo operators should return the full amount of the government-provided aid: “Congress intended for these taxpayer funds to save jobs, not to provide windfalls to thriving businesses,” the South Carolina delegate wrote in a letter October 20.
Atlas executives disagree, saying earlier in November that the company was “fully qualified” for the funds, as laid forth by the Treasury Department.
“We are not intending to return the funds,” chief executive John Dietrich said, noting that it was not a need-based program. “We responded accordingly and have been in full compliance, not only with the committee’s request, but sharing the documents and so forth that they have asked for, and we’ll continue to fully cooperate.”
Atlas Air did not immediately respond to a request for comment.
Scott Treibitz, a representative for IAP Local 2750, the union representing many Atlas Air pilots, pointed to recent stock sales by executives and questioned if the stock would be at such high levels if not for the government funding. The union has for years been attempting to re-negotiate a new contract with Atlas, but say the company has refused to come to the table.
To be sure, Atlas Air, like many of its passenger and cargo peers, was significantly impacted by the pandemic, with profits falling more than 85% in the first quarter of 2020. By the third quarter, which Atlas reported on November 5, however, profits returned to a record-high.
“2020 certainly has been an unprecedented year,” Dietrich said. “We expect volumes and yields in the fourth quarter to be driven by continued e-commerce growth and year-end airfreight demand, coupled with the ongoing reduction of passenger belly capacity in the market.”