November 10, 2004; Page A1
Reuters
The Washington Post
CHICAGO -- Delta Air Lines on Wednesday said it plans to cut between 6,000 and 6,900 jobs during the next 18 months, implement a 10 percent across-the-board pay reduction and reduce employee benefits in a bid to avoid bankruptcy.
Previously, the company said it needed to reduce staff by 7,000 in an effort to cut costs. Delta has more than 60,000 employees, according to its Web site.
Atlanta-based Delta also said it would issue as much as 75 million shares of common stock, mostly to pay employees as part of a new incentive program. The company said it will use an exception in the New York Stock Exchange's shareholder approval policy to issue the shares.
Delta said a committee of it's board of directors determined that any delay in gaining shareholder approval for the stock issue could "seriously jeopardize" its financial viability, Delta said. The No. 3 U.S. carrier will notify shareholders by mail of the plan without seeking their approval.
The airline added that it would implement new employee incentive programs as part of its restructuring.
Delta has been searching for ways to cut costs to restructure its business in a fight to avoid bankruptcy. Like other airlines, it has been plagued by high costs, weak revenue, skyrocketing fuel prices and stiff competition from discount carriers.
Shares of Delta slipped to $6.18 in light premarket trading on the Inet trading system, from their Tuesday close at $6.25.
http://www.washingtonpost.com/wp-dyn/articles/A39109-2004Nov10.html?sub=AR