Delta, Northwest cite jet fuel costs in merger

15 April 2008 17:40  [Source: ICIS news]

HOUSTON (ICIS news)--Rising fuel costs helped to drive merger of US airlines Delta and Northwest, Delta said in a press conference on Tuesday morning.

“We will be able to withstand the volatility of fuel prices,” Delta CEO Richard Anderson said. “Fuel costs were eroding the financial benefits.”

Anderson said the consolidation of the two carriers gives the single company, to be known as Delta, “scale and scope to be able to compete on a global basis.”

Combined airlines will have will have increased buying power and expanded networks without the need for more flights, industry analyst William Swelbar said recently.

Combined, the company and its regional partners will provide access to more than 390 destinations in 67 countries. Delta and Northwest, together, will have more than $35bn (€22bn) in aggregate annual revenues, operate a mainline fleet of nearly 800 aircraft and employ about 75,000 people worldwide.

The combined company will have an expected liquidity of nearly $7bn at closing of the merger.

($1 = €0.63)

By: Steven McGinn
+1 713 525 2653

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