Delta to cut costs by reducing flying and trimming jobs
The need to trim costs amid the “global economic recession” has been felt by the world’s largest carrier too - Delta Air Lines Inc plans to cut its systemwide capacity by 6 percent to 8 percent in 2009, owing to weaker travel demand. The new cuts are inclusive of the carrier’s previously announced cuts of 13 percent in the second half of 2008.
On a Webcast of a Credit Suisse Group AG airline conference in New York, President Ed Bastian said: “We have seen a fairly significant dropoff in demand, starting in October. The revenue environment is as cloudy as it’s ever been. We’ve never seen the level of demand destruction that some are forecasting for our business.”
In a regulatory filing, Delta said its domestic capacity will be pared by as much as 10 percent and international flying by up to 5 percent compared with 2008. The company said the new capacity projections take into account the year-over-year impact of the previous retrenchment.
The company, which this year merged with Northwest Airlines, said it was analyzing how the capacity reductions would affect its 75,000-person payroll. In March, the company unveiled plans to cut 2,000 jobs, saying it would offer optional severance packages. However, buyouts allowed Atlanta-based Delta to cut 4,000 jobs this year, or about 7.3 percent of its total before buying Northwest in October.
Chief Executive Officer Richard Anderson told employees in a memo that Delta will offer “voluntary programs” to shrink its workforce as it reduces flying.
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