The U.S. Treasury Department announced on Friday that it received $556.7 million from auctions selling warrants in 11 major U.S. airlines.
These warrants were received in exchange for COVID-19 assistance provided to the airlines.
The total aid granted to airlines was significantly higher, with Congress approving $54 billion in bailouts during 2020 and 2021.
Of this amount, $14 billion had to be repaid by the airlines, and the Treasury received warrants to buy stock at the share price during the awards.
These warrants are set to expire between April 2025 and June 2026.
The Treasury had set revised minimum prices for the warrants at $458 million in total.
A spokesperson indicated that the government would announce individual auction sale prices later this summer.
American Airlines received $12.6 billion in government aid, Delta $11.9 billion, United Airlines $10.9 billion, and Southwest $7.2 billion.
Seven other airlines, including Alaska Airlines with $2.2 billion, received smaller awards.
The Treasury set reserve prices of $221 million for Delta’s warrants, $159 million for United, $25 million for American Airlines, $30 million for SkyWest, $17 million for Alaska Air, $2.7 million for Hawaiian Airlines, $1.9 million for Frontier Group, and $1.7 million for Southwest.
The Treasury aimed for at least $50,000 per airline for warrants in Allegiant, Spirit Airlines, and JetBlue.
These warrants were priced below the current trading prices of the airlines’ stocks.
Southwest and Delta Air Lines declined to comment, while other airlines did not immediately respond to requests for comment.
In addition to the bailouts, the U.S. government extended $25 billion in low-cost loans to airlines.
The COVID-19 pandemic caused a historic drop in air travel demand, with U.S. air passenger travel falling by 60% in 2020 to its lowest level since 1984, reducing by more than 550 million passengers.
Airlines responded by cutting costs and struggling to stay afloat during this challenging period.