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Largest single-day transformation in Delta history
Delta Air Lines “transformation plan” that includes cutting 7000 jobs over the next 18 months and cost cuts of $2.7 billion by the end of 2006 may still not ward off bankruptcy, said the carrier’s CEO Gerald Grinstein.
“If the pilot early retirement issue is not resolved before the end of the month, or if all of the pieces don’t come together in the near term, we will have to restructure through the courts,” said Mr Grinstein.
The 7000 job cuts represent 10% of the airline’s employees.
The job losses were only part of a cost cutting plan that also includes axing Dallas-Fort Worth airport as one of the airline’s four hubs. Instead, Delta will expand its hubs in Cincinnati and Salt Lake City.
Mr Grinstein said there would be a 15% reduction in administrative and overhead costs, including management cuts.
Delta said the plan was part of a move to save more than $5 billion by 2006 and was on track to deliver nearly half of that total by the end of this year.
Delta is asking pilots to take a pay cut of at least $1 billion.
As part of what Mr Grinsten called “the largest single day transformation in Delta’s history,” the airline will redeploy its remaining hubs. Daily flights from Atlanta will go from 970 to 1,051; Cincinnati and Salt Lake City will also have increased flights. Delta will also add 31 non-stops.
Future growth will include Song, which will add a dozen aircraft to the present 36-plane fleet.
At Dallas-Fort Worth, American Airlines is adding to its schedule to make up for lost Delta flights.
Report by David Wilkening
David
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