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Delta to miss pensions
Sep 15 6:31 PM US/Eastern

By Jui Chakravorty and Christian Plumb

NEW YORK (Reuters) - Delta Air Lines Inc. warned it may miss 3,500 retirees' pension payments, while Northwest Airlines Corp. hired a battery of lawyers and advisors as the carriers began a long march through bankruptcy.

The moves came as the third- and fourth-largest U.S. air carriers began their Chapter 11 cases a day after they joined United Airlines and US Airways in Chapter 11, after losing an uphill struggle with soaring oil prices and low-cost rivals.

Bonds of both airlines rose as analysts said it would be easier for them to cut wages and operating costs while they are in bankruptcy. Delta shares rose while Northwest's fell.

Delta pilots suffered what may be the first of many blows for the airlines' employees as the Atlanta-based carrier said it would send a letter to some 3,500 retired pilots telling them it may miss their October pension payments.

The warning came as AFL-CIO President John Sweeney urged airlines not to "use bankruptcy as a cover to shed workers' pensions and responsibilities to loyal employees."

Posted by Kraven Moorehead on September 16, 2005 02:06 PM |

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