Northwest to cut flights, work force

Bloomberg News

NEW YORK — Northwest Airlines Corp., the fourth-largest U.S. carrier and one of the largest in the Hawai'i market, plans to further reduce its flight schedule and work force in the second half to trim costs and cope with lower demand.

Chief Executive Richard Anderson declined to comment on the size of the reductions, saying he would talk with the company's board about the moves. Any job cuts probably will be through freezing hiring for some positions or attrition, and the flight changes likely will be in September or October, Anderson said.

"We're analyzing all of our flying and we'll be making judgments about pulling down our level to maximize the profitability and minimize losses," he said after the company's shareholder meeting. "When the operational level comes down it has an impact on staff."

The airline earlier this year sought to generate $200 million by cutting back flights and reducing its payroll 5 percent, including firing more than 100 employees. Northwest had a first-quarter loss from operations of $123 million and has said it expects a loss this quarter of $50 million to $75 million. The company blamed high fuel prices and a decline in business travel demand as economies slowed here and abroad.

Rising labor costs have also hurt Northwest, which secured a new contract with its mechanics in May. Because of the threat of a strike by the mechanics, some passengers avoided the carrier, affecting first-quarter sales.