Blue Skies

The U.S. airlines had anxiously wondered how much CAB would give them in retroactive airmail pay. The lines had asked for the back pay, contending that their mail contracts had failed to take account of the full rise in costs. Last week CAB unwrapped a big and shiny award. It granted $7,800,000 in retroactive mail pay to seven lines: American, United, T.W.A., Northeast, Northwest, National and Challenger. (This was almost enough to wipe out the whole industry's loss for 1948.)

CAB set aside $2,000,000 of the grant for American, United and T.W.A., to make up losses suffered when their DC-6s were grounded in 1947 and their Constellations in 1946. In so doing, CAB established a precedent. From now on, it will reimburse the airlines for losses suffered from the grounding of new equipment by the government.

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