Transportation Industry

Company Watch - Northwest Airlines

AirGuide Business, March 31, 2008

Mar 31, 2008

Northwest Airlines said on Friday it will begin charging USD$25 to check a passenger's second bag, a move that other carriers have attempted to bolster revenue amid high fuel prices. Economy class customers will not be charged to check one piece of luggage. Members of loyalty programs may still check two bags at no additional charge. Customers booked in first class can continue to check up to three bags at no charge. Other changes include an increase from USD$80 to USD$100 for three or more checked bags, and an increase from USD$25 to USD$50 for overweight bags heavier than 50 pounds. The new fees apply to flights within North America on or after May 5. Northwest is the fourth major airline to make the change. United Airlines, Delta Air Lines and US Airways announced new fees earlier this year. Mar 29, 2008

Northwest Airlines and Delta Air Line are seeking to avoid the labor headaches still afflicting US Airways after its merger with America West Airlines in 2005, Delta and Northwest had sought to get their pilots on board before proposing a merger to shareholders and US antitrust officials. The unions received information from the companies about how the deal would work and agreed in principle to higher wages, an equity stake in the merged company and other benefits. The pilots, however, could not agree on merging their seniority lists after several weeks of talks. Seniority determines when pilots work, what planes and routes they fly and their path for moving up in the ranks. Mar 28, 2008

Northwest Wants Delta Merger To Go Ahead. Northwest Airlines has proposed to Delta Air Lines that they go ahead with a merger, despite the lack of support from pilots, two sources with knowledge of the matter said on Friday. Intense speculation that the carriers would try to create the world's biggest airline fizzled out earlier this month when their respective units of the Air Line Pilots Association (ALPA) failed to negotiate a formula for working together. Delta's ALPA group had no comment while Northwest union officials could not immediately be reached. Both unions had previously said their support was crucial and they would not support a merger that did not work in their favor in several areas. Delta pilots were instrumental in fending off a hostile merger attempt by US Airways last year. Neither Delta nor Northwest commented on the latest development. Mar 28, 2008

The revived Northwest Airlines and Delta Air Lines merger prospects boosted both airlines' share prices, which have fallen recently as expectations for a deal evaporated and global oil prices rose well above USD$100 a barrel. Northwest rose 3.5 percent to close at USD$8.76, while Delta was up 3.1 percent to USD$8.61. Both companies trade on the New York Stock Exchange. Mar 28, 2008

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