Delta: $3 billion to survive
Delta Air Lines needs $3 billion in cost savings to survive, says Edward Bastian, the airline’s chief financial officer.
“We are losing cash at a fairly alarming rate. If we don’t stop losing cash, we won’t make it,” he said.
Delta reported losses of $2.6 billion the first nine months of the year.
Mr Bastian made his remarks at a bankruptcy court hearing, said wire services.
The Atlanta-based Delta is seeking cuts from its pilots to help offset rising fuel costs and stiff competition from low-fare carriers.
Delta filed for Chapter 11 on Sept. 14. The airline has recorded losses of more than $11 billion since 2001.
Delta’s announced plan is to save $970 million annually through debt relief, lease and facility savings and fleet changes. The airline hopes to add another $1.1 billion in changes to its route network.
Delta is reducing its domestic capacity by up to 20%, while increasing its potentially more profitable international volume by up to 25%.
Mr Bastian said the airline’s debtors under bankruptcy are “very, very nervous.”
He said employment costs are making the airline less competitive.
“Carriers that can price product at levels below our costs are taking our market share,” he said.
“Our cost structure is a significant reason why we have experienced losses,” he added.
Report by David Wilkening
David
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