Should the government buy up middle seats? American Airlines pilots think it could save travel and jobs

The U.S. government should consider buying out every middle seat from commercial airlines until the COVID-19 pandemic subsides, the union representing American Airlines pilots said Wednesday.

The Allied Pilots Association’s proposal would amount to billions in subsidies every month but the union sees it saving jobs while ensuring social distancing on planes.

The association, representing about 15,000 pilots, is hoping the idea works its way into a second economic stimulus package for the airline industry. Buying up the middle seats would cost between $1.9 billion to $3.8 billion a month at current flying levels.

The proposal comes as there are increased questions about flying rules during the COVID-19 pandemic. The Federal Aviation Administration has reiterated it will not mandate face masks or any other COVID-19-related restrictions. There were also reports this week the European Union might restrict American travelers because of high COVID-19 rates in the U.S.

On Wednesday, the governors of New York, Connecticut and New Jersey announced they’ll impose a 14-day quarantine on travelers from states with high infection rates. Texas is one of those states.

Allied Pilots Association President Eric Ferguson said the proposal could be cheaper than the stimulus already given to airlines.

“People don’t want to be shoulder to shoulder and elbow to elbow with a stranger,” Ferguson said. “This is better than paying people to sit around and do nothing.”

Airline employee unions are also facing a grim future. Airline executives have said that they expect air travel demand to be down 30% in the fall and they will likely need far fewer employees as well. American Airlines has already started trimming administration and support employees and Southwest Airlines is among those offering buyouts to workers.

The union is calling its proposal SEATS, or Safe Essential Air Transportation Seating.

“While the cost of implementing SEATS would be substantial, the consequences of doing nothing could be devastating,” the union said. “By stimulating air travel and preserving a large number of jobs, SEATS would likely provide a higher return on investment for taxpayers compared to the monetary assistance provided to the airlines earlier this year through the CARES Act.”

The federal government has already given airlines $25 billion in grants and loans and has allocated another $25 billion for loans that are being divvied up now by the Treasury Department. The previous government stimulus prohibits airlines from laying off or furloughing workers, but those rules expire on Sept. 30 and there will likely be a wave of layoffs that follow.

According to the union’s math, its proposal could cost up to $4 billion a month and last until the pandemic subsides, with a lower amount of subsidies when COVID-19 immunity hits high levels.

Right now, airlines are taking the burden of blocking off middle seats to themselves. Dallas-based Southwest said it will only sell planes to two-thirds capacity through September to give passengers the ability to social distance. Fort Worth-based American isn’t selling middle seats in every other row.

“But an airline’s breakeven load factor can be as high as 75 percent, much higher than current load factors,” the union’s proposal said. “Therefore, limiting seating to any percentage below that will guarantee airlines continue to lose money.”

Sara Nelson, head of the Association of Flight Attendants, told CNBC on Wednesday that the government needs to take a bigger role in helping airlines by mandating face masks and other safety protocols. Airline CEOs, she said, have been quiet on such issues because they are negotiating with the Treasury Department for loans needed to get through the pandemic.

“11 million people depend on the airline industry for their jobs, so we are talking about a huge increase in the unemployment rolls if they don’t get this right,” Nelson told CNBC.

Airlines have already struggled to make passengers comfortable, instituting face mask rules and then not enforcing them. Only last week did airlines say they would start banning passengers who didn’t wear masks in flight, leading American Airlines to ban one New York political activist.

The New York Times reported Tuesday that the European Union could include the United States on a list of banned countries for incoming travelers because of growing infection rates. That would be another blow to airlines. Although there is little international travel now, overseas routes can be highly profitable for airlines.

“The return of air travel is a major catalyst for economic recovery, stimulating ancillary spending well beyond the cost of an airline ticket,” Ferguson said. “But in order for air travel to return, passengers must feel comfortable that it is safe.”