Delta seeks 2,000 worker buyouts

Delta Air Lines Inc., the world's largest carrier, is targeting about 2,000 more job cuts through buyouts to counter a slump in travel demand.

Chief Executive Officer Richard Anderson gave the figure Thursday in an interview in which he reiterated plans to trim 2009 seating capacity by as much as 8 percent. The payroll reduction would be about 2.7 percent of Delta's 75,000 workers.

"We're expecting a number around 2,000 because our capacity pull-down is going to be in the 6 to 8 percent range," Anderson said. "We will know more towards the end of this month, when employees must decide whether to take the buyout."

This is the first time that Atlanta-based Delta has said how many more jobs it needs to shed after paring 4,000 positions with buyouts last year and buying Northwest Airlines. Delta is pruning flying to help ensure a 2009 profit, even as it forecasts industrywide revenue to drop as much as 12 percent.

While Delta's passenger traffic rose 1.7 percent in 2008, bucking a 2.3 percent decline among the seven biggest carriers, air travel in the U.S. probably will slump again this year because of the recession and carriers' shrinking schedules.

The latest buyout offer is being extended to many younger employees, Delta said last month. Workers with at least 10 years of service and whose seniority and age total at least 55 are eligible, Anderson said in a Dec. 12 memo to employees.

Delta's previous offer required 60 years of combined age and service, and 4,000 employees took the buyout, double Delta's target. Northwest eliminated 2,500 positions before being acquired by Delta on Oct. 29.

The biggest U.S. carriers slashed a combined 26,000 jobs and parked 460 jets last year to shrink flying by more than 10 percent. Reductions totaled 6,800 at AMR Corp.'s American Airlines and 7,000 at UAL Corp.'s United Airlines, the second- and third-biggest U.S. airlines.

"The worldwide economic picture is difficult and will remain difficult for the remainder of 2009," said Anderson, who is in Japan to meet with government and business leaders.

Delta rose 68 cents, or 6.6 percent, to close Thursday at $10.97. The shares tumbled 23 percent last year.

The airline will be profitable in 2009 even if industrywide revenue falls by 20 percent, which would be the biggest decline since the period following the 2001 terrorist attacks, Bastian said.

"We have not provided a specific earnings target for 2009 because frankly, there are too many uncertainties that we're facing," he said.

The 65 percent drop in jet-fuel prices since a July record of $4.36 a gallon will help Delta preserve profits, Bastian said.

"You would need to see twice the scale of revenue erosion that we're anticipating before eating into the savings that we're expecting to see on fuel," he said.