US airlines plead for government help

Continental Airlines have cut flights by 20%

Airlines in the US are calling on the government to bail them out after a warning that many face bankruptcy after last week's attacks.

Members of the Bush administration are expected to meet airline executives on Monday to discuss the escalating crisis in the industry.

We're very interested in finding ways to make certain that in this particular instance, there is no permanent damage to our civilian aircraft capacity

Vice-President Dick Cheney

Continental said that it was losing $30m a day following last week's attacks, and warned that without financial assistance, it might have to file for bankruptcy.

The US House of Representatives failed last week to adopt a measure that would have offered $12.5bn in loan guarantees to the airline industry and a further $2.5bn in direct aid.

But Vice-President Dick Cheney said that the government was open to helping the airline industry with the financial losses.

Unprecedented shutdown

Continental has laid off 12,000 of its 56,000 employees, while its rivals United Airlines and Delta have cut scheduled flights by 20%.

Increased security will cut into airline profits

Delta Airlines, the third largest carrier in the world has also refused to rule out redundancies.

Gordon Bethune, Continental's chief executive, has predicted that as many as 100,000 airline jobs could eventually be lost worldwide.

BBC correspondent Jane Peel in Washington said analysts believe that the airline industry could lose anything up to $17bn by the end of the year.

It is the result of the unprecedented shutdown of American airspace, the dramatic reduction in demand for airline travel, and the high cost of new security measures.

So far the White House has not promised any financial assistance but Vice-President Dick Cheney said the Bush administration was open to the concept.

"We're very interested in finding ways to make certain that in this particular instance, there is no permanent damage to our civilian aircraft capacity," Mr Cheney told NBC television on Sunday.