Capacity roll back at Northwest knocks off 2,500 jobs
11 Jul 2008
Northwest Airlines has clarified that its previously announced capacity cuts, which include the removal of over 40 aircraft from its fleet during 2008, will cause a reduction of 2,500 front line and management employees. The statement comes at a time when airlines globally are fighting to stay in the air amidst record fuel costs, which NWA has decided to combat by unveiling a range of new fees.
Last month, Northwest Airlines had unveiled plans to reduce its fourth-quarter mainline capacity between 8.5 per cent and 9.5 per cent year on year, and eliminate 14 Boeing 757s, A319s/A320s along with 33 DC-9s from its fleet this year. Northwest Airlines said that all employee groups that would be affected by the cuts, and reductions would be maximised through "a variety of voluntary programs." The airline wants to use furloughs "only if voluntary means fail to achieve the targeted reductions."
Northwest Airlines president and CEO Doug Steenland said that the airline's fuel costs have more than doubled in the past year, and to manage the airline during this ''unprecedented fuel challenge'', actions are necessary both in terms of cost control as well as increased revenues.
Alongside the fleet reduction and job losses, new fee levied is expected to bring in around $250-$300 million of additional revenues annually, according to Steenland.
Following in the flight path of a number of its domestic competitors, Northwest Airlines will levy a $15 charge for most customers' first checked bag starting 28 August, on flights in the US and to Canada. Northwest Airlines already levies $25 for the second piece of luggage.
Moreover, tickets issued via its WorldPerks loyalty program will cost $25-$100 starting 25 September, which Northwest is calling "a temporary service fee". Ticket change fees has been kicked up to $150 effective a day ago. Steenland says that these fee increases ''better align our costs with providing these services'', in addition to help combat ''extraordinary fuel prices.''
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