Copyright 2002 Chicago Sun-Times, Inc.  
Chicago Sun-Times
October 9, 2002 Wednesday
SECTION: FINANCIAL; Pg. 62

LENGTH: 321 words

HEADLINE: Airline CEOs renew call for assistance

SOURCE: Bloomberg News

BODY:
WASHINGTON--Delta Air Lines Inc. Chief Executive Officer Leo Mullin and AMR Corp. CEO Donald Carty renewed calls for federal assistance, saying costs for security and insurance could soon collapse the U.S. airline industry.

Without help, "it's going to be really questionable about whether most--a majority of the industry--is going to make it," Mullin said at a U.S. Chamber of Commerce forum in Washington on aviation and the economy.

Airlines face "the perfect storm" of economic difficulty and government-imposed costs, Carty said.

"I don't think enough people in Washington yet understand that they could lose the whole industry," he said. The industry needs to "get this economic anvil off our chests before another economic anvil might be dropped on it, and that might well be an Iraqi war."

Major air carriers said two weeks ago the industry may be at risk of collapse unless they get help with security and insurance costs stemming from the Sept. 11 attacks. The carriers requested aid and tax relief totaling about $4 billion a year.

The Senate may vote as soon as today on legislation that would give carriers a piece of the aid they seek. The bill, by Sen. Ernest Hollings (D-S.C.) extends for nine months government-subsidized war-risk insurance for airlines. The insurance subsidy under current law will continue at least until Oct. 16.

Hollings' bill also would allow pilots to carry guns in the cockpit and for up to 40 airports would extend by a year a Dec. 31, 2002, deadline to screen all checked bags with explosive-detection machines.

A House panel approved legislation last week giving airlines access to discounted war-risk insurance through next year. The bill also would cap airlines' liability for acts of terrorism and set a deadline for improving the screening of U.S. mail so it can be carried on airplanes, a much-sought source of airline revenue.

Bloomberg News

GRAPHIC: Associated Press, AMR Corp. Chairman and Chief Executive Officer Donald Carty addresses the U.S. Chamber of Commerce Tuesday in Washington.

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