Delta estimates 2,000 workers to take severance

Delta Air Lines Inc., the world's biggest carrier, expects about 2,000 employees to accept the company's latest round of severance offers that were made due to its plans to reduce systemwide capacity in 2009 by 6 percent to 8 percent.

Spokeswoman Betsy Talton said Thursday the actual total won't be known until after the window for employees to accept the offers ends on Jan. 31.

Last month, the Atlanta-based company said it would offer voluntary severance payouts to a majority of the 75,000 employees at Delta and Northwest's mainline operations as part of a plan to cut an unspecified number of jobs.

The program is similar to one earlier in 2008 that Delta used to trim about 4,000 jobs. Northwest previously trimmed jobs of its own before being acquired by Delta on Oct. 29.

Delta said the latest job cuts are necessary in light of its capacity reduction plans, which were prompted because the weak economy has eroded demand for seats on airplanes.

Delta and Northwest's mainline operations include 75,000 employees. The entire company, including regional subsidiaries Comair, Mesaba and Compass, has about 85,000 employees. The 12,000 pilots of Delta and Northwest, as well as certain management and administrative employees, are not eligible for the voluntary severance programs.

Delta's president, Ed Bastian, told reporters during a stop in Japan on Thursday that global sales for the overall airline industry are likely to fall 10 percent this year from the previous year, but the recent slide in oil prices will deliver $5 billion in savings for Delta.

Oil prices have fallen to about $35 a barrel this week after peaking at $147 in July 2008.

Bastian said Delta's acquisition of Northwest will help the combined company withstand the global economic slump.

He and other company officials denied that projected savings and other benefits from the acquisition may be endangered by the slowdown although flight routes were being adjusted or canceled in response to sliding demand.

"We are well prepared both through our cost structure and merger benefits ... as well as the fuel savings to be able to withstand the challenges and actually come out in a better spot," Bastian told reporters at a Tokyo hotel.

Delta officials said the airline can hope to reap about $2 billion in savings in 2012 from the combination of the two airlines.

"The merger is even more important in the face of the financial circumstances," said Delta Chief Executive Richard Anderson.

The voluntary severance programs include one for employees with 10 or more completed years of service, whose completed years of age and service add up to at least 55. The second program is an early out program that was to be offered to those employees who do not qualify for the first program but who are frontline/contract ground and flight attendant employees with five or more years of service and merit/salaried employees hired before the first of this year.

The airline said previously its goal is to achieve all necessary reductions through attrition, limited hiring and the introduction of the voluntary severance programs.

Delta shares rose 30 cents, or 2.9 percent, to $10.59 in afternoon trading Thursday.

Gallery

Fullscreen SlidePrevious Slide

1 of 1

Next Slide