Northwest announces it will lay off 1,500
By John Duchemin
Advertiser Staff Writer
Northwest Airlines Corp. will close its 50-employee Honolulu reservations center Sept. 18 as part of a nationwide cost-cutting effort that includes 1,500 layoffs.
Reservations center employees in Honolulu are being given two choices: take a job at one of Northwest's other reservations centers or be laid off.
Northwest, the fourth-largest U.S. airline, also said it will reduce flights and close some facilities to cut costs. Northwest took the steps after losing $55 million, or 65 cents a share, in the second quarter, compared with net income of $115 million, or $1.26, a year earlier.
The 1,500 jobs represent about 2.8 percent of the carrier's worldwide workforce of 53,000. About 500 employees will be laid off, including 130 in management jobs, while the rest of the cuts will result from attrition, voluntary leaves or unfilled positions.
Northwest and most rivals had second-quarter losses as the weaker U.S. economy forced many companies to restrict employee travel.
"What Northwest is doing is simply what everybody else is going to do," said Terry Trippler, who tracks air fares for the online travel agent OneTravel.com. "Northwest is just doing it first."
American Airlines and United Airlines, the two biggest U.S. carriers, yesterday said they will freeze some hiring, retire planes earlier and rein in growth plans. Both carriers had second-quarter losses and forecast losses for this quarter as well.
Delta Air Lines said today it lost $90 million in the second quarter, blaming low demand for high-priced business travel, more expensive jet fuel and a three-month strike at its Comair regional carrier unit.
Most of Northwest's Honolulu operations are being affected by the cost-cutting measures, said Ashley McNeely, representative for Teamsters Local 2000, the labor union for 416 Honolulu-based Northwest flight attendants.
Northwest earlier this week notified the state that it plans to close its Honolulu base for pilots flying McDonnell Douglas DC-10 jets on Oct. 31, affecting about 180 pilots.
Last week, the airline asked Honolulu flight attendants to take voluntary leaves of absence.
Northwest also has cut jobs among its Honolulu airport and inflight support staff, laying off at least one employee, McNeely said.
The Honolulu reservations center is one of nine in the Northwest system. Honolulu employees will be allowed to transfer to any other center except the company's New York office, which also will be closed.
Bloomberg News Service also contributed to this report.