Northwest, like the rest of the network airlines, will reduce fourth-quarter capacity in response to the high cost of fuel. The airline is also making a case that a Delta merger makes more sense than ever given the fuel crisis the industry faces.
Northwest will reduce mainline domestic and international capacity in the fourth quarter of by 8.5% to 9.5%. This includes reductions previously announced in April.
“No domestic station closures are planned as a result of these capacity reductions,” said Northwest CEO Doug Steenland. “Instead, we will pare unprofitable flying while maintaining the scope and presence of our network.”
Northwest is removing a combination of 14 Boeing 757s and Airbus narrowbody aircraft from the fleet. In addition, the airline’s DC-9 fleet will be reduced from 94 aircraft at the start of 2008 to 61 by year’s end.
Northwest has not yet finalized how many employees will lose their jobs as a result of reduced flying. The airline said it will first look to voluntary programs such as early-outs.
As for the proposed Northwest-Delta merger, Northwest said “merger-related synergies will improve the financial ability of Northwest and Delta to meet the challenge presented by the fuel crisis and better position the combined carrier for long-term strength and profitability.”
“When we first contemplated a merger with Delta, as oil was approaching $100 a barrel, we knew this was the right deal with the right partner,” Steenland said. “Now, with oil above $130 a barrel, the case for the merger, with its resulting synergies, is stronger than ever.”
However, a Northwest-Delta merger won’t enable the carriers to reduce what they pay for fuel.
Northwest also said the merger will “create a worldwide, geographically balanced network that will enhance customer preference and make the combined carrier more competitive.”