US airline Delta said today it will cut up to 9,000 jobs, or 17 percent of the work force at its flagship service, and reduce pay and make changes to its route network to focus more on international flying as it moves swiftly to restructure its costs in bankruptcy.
The changes are part of the nation's third biggest carrier's effort to save an additional $3 billion annually by the end of 2007. That's on top of $5 billion Delta had previously said it wanted to save by the end of 2006.
The company's chief executive, Gerald Grinstein, will take a 25 percent pay cut and all other executives will take a 15 percent pay cut.
"The only thing that surprised me is that they did it so quickly," Ray Neidl, an airline analyst with Calyon Securities in New York, said of the changes. "It shows that they're determined to turn this airline around."
The 7,000 to 9,000 job cuts will come from the 52,000 people employed at Delta's flagship airline and not at any of its affiliated airlines, spokeswoman Chris Kelly said. They are on top of roughly 24,000 jobs that Delta has said it would shed since 2001, when the terrorist attacks sent the major airlines into a tailspin most of them have never recovered from.
Delta and its subsidiaries listed in regulatory filings 65,300 employees as of June 30, but that figure included recently sold feeder carrier Atlantic Southeast Airlines. It was not immediately clear how many employees Delta and its 18 subsidiaries, including discount carrier Song and feeder carrier Comair, currently have.
The new cuts come eight days after Delta filed for bankruptcy protection in New York. No. 4 U.S. carrier Northwest Airlines Corp. filed for Chapter 11 later the same day. On Wednesday, Northwest said it will lay off 1,400 flight attendants by January.
Delta's Grinstein said the plan announced today is designed to "save Delta in the near term, so that it can compete and win in the long term." He said the effort will protect Delta from the threats posed by its competitors and make the company profitable in just over two years.
AP