NORTHWEST BANKRUPTCY THREATENS PACIFIC SERVICE

admin's picture

SAIPAN, Northern Marianas (Saipan Tribune, Oct. 17) – Northwest Airlines anticipates further reductions in its flight schedule worldwide beginning in January 2006, as a result of its ongoing bankruptcy process.

In a statement, the airline announced that it had already reduced its late fall schedule. It plans to further cut its schedule as the traditionally slower winter travel season approaches.

"Northwest anticipates that its fourth quarter system mainline capacity will be down seven to eight percent compared with the fourth quarter of 2004, with domestic mainline capacity decreasing nine to 10 percent, and international mainline capacity down four to five percent," the air carrier said.

However, Northwest was quick to assure customers that the planned reduction would have little impact on its overall operations.

"The schedule reductions will have minimal impact on the airline’s three domestic hubs. Many of the markets we serve will see no change in the number of flights offered," said Tim Griffin, Northwest executive vice president of marketing and distribution. "The late fall schedule provides the markets we serve with broad time-of-day coverage, while judiciously and responsibly reducing capacity. This element of Northwest’s restructuring increases aircraft utilization, making Northwest a more efficient airline."

The airline further reported that, while Northwest’s January schedule was still under review, its first quarter 2006 system mainline capacity was expected to be down 11 percent to 13 percent from the same period in 2005. Over time, the Northwest mainline flight schedule could be reduced by as much as 15 percent or more, the airline added.

It was not immediately known how this announcement would affect Northwest operations on Saipan.

Northwest just began nonstop daily flights between Osaka and Saipan on October 1, filling the gap left by Japan Airlines which stopped regularly scheduled flights to Saipan on October 4.

Northwest is also flying daily to Saipan from Tokyo and Nagoya.

Last month, the world’s fourth largest airline filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of New York.

The company had said the Chapter 11 petition would allow the company to restructure its debts, so it can continue to operate.

Specifically, the bankruptcy process was initiated so the airline could set a competitive cost structure, including both labor and non-labor costs, a more efficient business model, which will allow it to continue to deliver superior choice and service to customers, and a strengthened balance sheet with debt and equity levels consistent with long-term profitability, Northwest had said.

October 17, 2005

Saipan Tribune http://www.saipantribune.com

Rate this article: 
No votes yet

Add new comment