Kansas Rescue Plan Shows the Hurt for Aviation Companies

Photo by Egor Myznik on Unsplash

While summer has seen an uptick in travel, the amount of financial damage done to the aviation industry due to the COVID pandemic will see ripple effects for a long time. Fortunately, the federal government in the US has committed to helping out struggling airlines and other companies with funding, and of course, that funding comes with strings attached.

Let’s take a look at what’s happening in Kansas.

The Kansas Aviation Company Rescue

Recent reporting has revealed that Kansas aviation companies are receiving about $100.5 million in order to save 4,284 jobs. This money is going to many airlines, but specifically, Spirit AeroSystems will be receiving more than $75 million or three-quarters of the total bailout fund.

Spirit AeroSystems, not to be confused with Spirit Airlines, is a manufacturer of parts for commercial airlines, business jets, and – yes – defense platforms, ensuring its position as a top priority for federal spending. Spirit Aerosystems is based in Wichita, Kansas.

How Do These Aviation Companies Get the Money?

The rescue funding comes as part of the Aviation Manufacturing Employment Protection (AMJP), which is a program of the American Rescue Plan. As the name suggests, manufacturers have a lot to gain, and the plan received bipartisan and union support.

According to the DOT, this funding can be used to pay up to half of the compensation for select employees for up to six months. Receipt of this funding comes with several strings attached, and companies cannot involuntarily furlough or lay off any of these employees during the time period.

Overall, the DOT has said that ever $482 million will go to 313 aviation businesses as part of the AMJP.