Thursday, April 24, 2008

Delta, Northwest Post Losses As Fuel Costs Rise

One of the more popular things we have been doing in class this past year has been to allow each group to pick at least one of their own cases. Thus we will be looking at the Delta-Northwest merger. So in light of this, some required reading for my classes.

Delta, Northwest Post Losses As Fuel Costs Rise:
"Delta Chief Financial Officer Edward Bastian said that the airline has moved quickly to address higher fuel prices by cutting U.S. capacity and controlling costs. Those steps offset more than 50% of the fuel-price impact.

'However, we clearly need to do more,' he added, noting that the merger with Northwest will eventually generate more than $1 billion in annual savings and revenue gains.

Delta Chief Executive Richard Anderson and his counterpart at Northwest, Doug Steenland, both said during conference calls Wednesday that the estimate on synergies is likely to go higher.

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