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Northwest Airlines Reaches Tentative Agreement With Pilots

March 6, 2006

Northwest Airlines Reaches Tentative Agreement With Pilots
March 6, 2006 – Northwest Airlines, the world’s fifth largest airline, announced that it has reached a tentative agreement with its pilots. The agreement, which is subject to approval, includes $358 million in labor and benefit cost savings toward the airline’s requirement to reduce its annual labor costs by $1.4 billion.

"After months of intense negotiations, ALPA has reached a tentative agreement with management. Throughout these negotiations our goal has been a consensual agreement. Our negotiating team has stayed focused on that goal, bargaining in good faith and around the clock to achieve this result," Capt. Mark McClain, chairman of the Northwest Airlines unit of the Air Line Pilots Association, said. "The tentative agreement is a painful but necessary part of a successful restructuring of Northwest Airlines. If all of us can distance ourselves from these recent labor struggles and focus on ensuring the future success of Northwest we can begin looking forward to our emergence from bankruptcy as a proud and profitable airline."

Currently, the International Association of Machinists and Aerospace Workers, which represents Northwest’s ground employees, is presenting the company’s contract settlement proposal to its members for ratification. On March 1, the Professional Flight Attendants Association and Northwest announced that the parties had reached a tentative agreement on a new contract. To date, permanent wage and benefit reduction agreements have been ratified by Northwest employees. In addition, two rounds of salaried and management employee pay and benefit cuts have been implemented and the needed aircraft maintenance employee labor cost savings have been achieved.

Northwest remains focused on its plan to realize $2.5 billion in annual business improvements in order to return the company to profitability on a sustained basis. The restructuring plan is centered on three goals: resizing and optimization of the airline’s fleet to better serve Northwest’s markets; realizing competitive labor and non-labor costs; and restructuring and recapitalization of the airline’s balance sheet.

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