Northwest Airlines To Cut 2,500 Jobs as Oil Soars

Northwest Airlines said it would cut its frontline and management staff by 8 percent as part of a sweeping capacity reduction aimed at offsetting the soaring cost of jet fuel.

Carlos Osorio Northwest Airlines

Northwest , which plans to merge with Delta Air Lines , estimated the job cuts and a variety of new fees would generate $250 million to $300 million annually.

The airline, the latest to announce job cuts, intends to reduce its capacity systemwide by 8.5 percent to 9.5 percent in the fourth quarter. The job cuts—about 2,500 in all—will affect all Northwest employee groups, the carrier said in a statement. Northwest has about 31,000 employees worldwide, according to its website.

The airline industry is rapidly downsizing as rising fuel bills undo the financial progress carriers have made through restructuring and fare increases in recent years.

Northwest said it would attempt to achieve its staff reduction with voluntary early-out programs, leaves, work rule changes and attrition.

Layoffs could follow if too few employees leave voluntarily.

The carrier also said it would attempt to boost revenue through new fees, such as a $15 charge to check a single bag. Other carriers have implemented that fee, which met with scorn from travelers.

Northwest shares were down 90 cents at $6.57 in afternoon trading on the New York Stock Exchange.

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