Delta, Northwest CEOs say oil cost justifies merger

The network formed by a merged Delta Air Lines (DAL.N: Quote, Profile, Research) and Northwest Airlines (NWA.N: Quote, Profile, Research) would help them avoid cutting the number of cities they serve if oil prices force more capacity reductions, their chief executives wrote in The Wall Street Journal on Wednesday.

"(If) extraordinary oil prices force further capacity reductions, the revenue generating capability of our worldwide network will better allow us to rationalize capacity by trimming frequencies rather than eliminating destinations," Delta's Richard Anderson and Northwest's Doug Steenland wrote in a letter to the paper's editor.

If Delta bought Northwest it would produce more than $1 billion in cost and revenue improvements, with transition costs of $750 million spread over four years, they said.

Read Full Article from Reuters

- Posted: 2008-06-25 08:21:05

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