Delta and Northwest File for Bankruptcy

September 15, 2005

Delta and Northwest File for Bankruptcy
September 15, 2005 – Delta and Northwest both filed for Chapter 11 bankruptcy protection Sept. 14, after battling spiking fuel prices, heavy debt, pension obligations, and high labor costs. Both airlines said they expect to continue normal operations and that the timing was coincidence.

Delta reports that it will reduce its fleet size, and CEO Gerald Grinstein said more job cuts will likely be needed on top of the 24,000 job cuts announced since 2001.

"There is no painless way out of this," Grinstein told The Associated Press. Grinstein, who took over Delta in January 2004, vowed to stay with the airline through bankruptcy.

Northwest says it will make more layoffs before the end of the year and will cut flights. Company officials said the 26-day strike by unionized mechanics was not a factor in the decision to seek bankruptcy court protection.

Both said passengers would not see any immediate effects from the filings, and pledged to honor all tickets and maintain their frequent- flier programs.