Northwest Airlines executives yesterday used a larger second-quarter loss to ratchet up their demands for $1.1 billion in annual labor concessions, and, most critically, $176 million in cost savings from the carrier's mechanics.

Northwest, which like other U.S. airlines is struggling under the burden of record fuel costs and soaring pension obligations, posted a second-quarter loss of $225 million, or $2.59 share.

That's 29 percent more than Northwest's $175 million, $2.11-a-share loss in the same period in 2004. The loss was slightly less than analysts' expectations, according to Thomson Financial, but still highlighted the carrier's rapidly deteriorating financial and labor situation.

The airline's shares gained nearly 10 percent, adding 43 cents to $4.88.

The mechanics, represented by the Aircraft Mechanics Fraternal Association, are 24 days away from a potential strike or lockout.

Northwest CEO Doug Steenland told analysts and reporters yesterday that "we're running out of phrases to describe our results in recent quarters, but clearly they are unacceptable."

He repeated previous threats to enter Chapter 11 bankruptcy if unions don't accept the concessions management seeks.

"We are going to restructure now," Steenland said, emphasizing the need to act immediately.

Absent new labor deals, an Oct. 17 change in bankruptcy law could determine whether and when Northwest enters Chapter 11, Steenland said. Companies that file after that will have less time to craft a reorganization plan before third parties can bid.

Northwest's talks with AMFA resume Aug. 2. But if a 30-day cooling off period expires Aug. 19 without a new contract, the mechanics could strike.

Steenland and other executives have said Northwest plans to operate its full schedule regardless.

To keep its planes flying, Northwest would use a combination of management mechanics, contract mechanics and maintenance outsourcing companies. The airline is training hundreds of replacements who Steenland suggested could become permanent replacements for striking or locked out AMFA members.

"There's a large number of very experienced and very skilled, licensed technicians who are very eager to get back into this business and find attractive the rates of pay we're offering for these positions," he said.