Delta CEO gives bleak assessment of demand

ATLANTA - The chief executive officer of Delta Air Lines Inc. gave a bleak assessment Thursday of demand for air travel amid the enormous financial strain that many Americans have been under in recent months.

In a recorded message to employees, CEO Richard Anderson did not specifically say the world's biggest carrier plans to cut more jobs or capacity than previously announced, though he did suggest the erosion in demand that the airline has seen has been very difficult.

"Passengers, our customers, are not buying tickets at rates they were buying tickets a year ago," Anderson said. "Obviously, we wish we didn't have to decrease our capacity, but we cannot fly our airplanes around at low load factors."

Atlanta-based Delta has previously said it expected about 2,000 employees to accept the company's latest round of severance offers that were made due to its plans to reduce systemwide capacity in 2009 by 6 percent to 8 percent. The window for employees to accept the severance offers closed at midnight Wednesday.

Anderson did not say in his message late Thursday how many employees accepted the offers or how many jobs the company would ultimately cut.

He did say that Delta would work through the numbers and look at who has chosen to take the packages and align that with the airline's needs.

Anderson said Delta needs to right-size the airline based on customer demand.

"The economy is very difficult," Anderson said. "It seems every day we read about companies announcing layoffs by the thousands."

He said customers are tightening their belts, not spending as much on vacations. As a result, Anderson said Delta will need to react quickly.

"A strong, durable airline is truly the only job security for all of us," Anderson said.

The voluntary severance payout offers were made to a majority of the 75,000 employees at Delta and Northwest's mainline operations.

The program is similar to one earlier in 2008 that Delta used to trim about 4,000 jobs. Northwest Airlines previously trimmed jobs of its own before being acquired by Delta on Oct. 29.

Delta and Northwest's mainline operations include 75,000 employees. The entire company, including regional subsidiaries Comair, Mesaba and Compass, has about 85,000 employees. The 12,000 pilots of Delta and Northwest, as well as certain management and administrative employees, are not eligible for the voluntary severance programs.

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