Delta cutbacks: Airline to offer payouts to 30,000 employess

Citing sky-high fuel costs, Delta Air Lines said Tuesday that it plans to offer voluntary payouts to 30,000 employees, with the aim of cutting at least 2,000 jobs.

The airline also plans to cut its U.S. capacity by an extra 5 percent. The announcement comes as Delta's prospects of a merger with Northwest Airlines seem dwindling and a weak economy has sent jet-fuel prices soaring.

In a letter to employees, Delta Chief Executive Richard Anderson and President Ed Bastian said that 30,000 people qualify for retirement or an "early-out program," both based on age and years of service. Delta had 55,000 full-time employees at the end of last year.

Delta needs to cut 2,000 jobs to offset fuel costs, according to the memo. The company would honor as many requests for retirement and early buyouts as it receives, Delta spokesman Anthony Black said.

Delta employs about 3,400 people at its Salt Lake City hub, and Black said it had not yet been determined how many employees there would be targeted for the payouts.

"While there are no specific estimates for Salt Lake City, I would say Salt Lake City is a very senior hub, so a large percentage of employees would be eligible," he said.

The employees will leave sometime in the fall, after the summer travel rush, and will be replaced by new employees who will receive less in salary and benefits than senior employees, he said. Pay raises, which had been expected to be announced this month, are also on hold.

In addition to the job cuts, Delta is eliminating 15-20 "mainline," or Delta aircraft, and 20-25 regional contracted jets, Black said. Flights to and from Salt Lake City and Fargo, N.D., Bellingham, Wash., Nashville and El Paso, Texas, will also be cut as part of the cost-savings measures.

Each route was served by SkyWest Airlines, with one flight from Salt Lake daily, seven days a week, Black said.

Prior to Tuesday's announcement, Delta flights from Salt Lake City landed at 106 destinations, and on peak days, there were 336 daily flights from Salt Lake City. After the cutbacks, there will be 105 destinations and 329 peak daily flights.

Of the 2,000 jobs that Delta wants to eliminate, 700 positions will be administrative and management jobs, and 1,300 are "frontline" jobs, such as flight attendants, gate agents, baggage handlers, reservation agents and mechanics. The announcement of the cutbacks boosted Delta's shares, which rose 86 cents, or 9.32 percent, to close at $10.09 Tuesday.