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Northwest 2007 Flying Levels

Old 09-21-2007, 06:48 AM
  #1  
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Default Northwest 2007 Flying Levels

This news report from Bloomberg confirms what the company has previously disclosed. However, the report did not touch on 2008 flying levels - keeping the DC9-30 retirement rumor alive. However, the NWA MEC hotline did state there is no merit to the DC9-30 rumor at the present time.

Obvously, NW will reduce mainline domestic flying levels and increase regional domestic flying levels in 08. The question is, "how much?" I read Congress included a 25% aviation gas tax hike in the FAA funding bill. If this passes and considering almost all analysts think oil to go over 100/barrel in 2008, suggests to me that NW would like to attempt to expedite the DC9 retirement. The catch is the E175 and CR9 are not really a direct replacement. There is a seat gap from 76 seats to 110 seats.

I don't think NW will retire the DC-9 in large numbers unless they get the 190s as a replacement (the C series is too far off). Retiring the DC9s in large numbers weakens NW ability to offer frequency against competitors and NW in no way shape or form is willing to do that. Recent proof in the NW/TPG acquisition of Midwest. And the E175s and CR9s will not truly replace DC9 flying in all scenarios ( in fact, technically - 36 DC-9s are flying previous Avro routes...so really 36 seventy six seaters can replace DC-9 flying). I wonder how many DC9 retirements are currently scheduled in 2008.

Thoughts?

http://www.detnews.com/apps/pbcs.dll...709200307/1001

Northwest Airlines Corp. has scaled back expansion plans for this year as it works to hire as many as 5,000 workers after exiting bankruptcy.
The airline plans to increase capacity by no more than 1 percent in 2007, compared with a previous plan to boost capacity by as much as 2 percent, spokesman Roman Blahoski said.
Northwest faced a pilot shortage in June and July after it slashed labor spending while reorganizing under bankruptcy protection. The airline has said it needs to hire flight attendants, customer-service representatives, reservations agents, and baggage handlers and other ground workers this year.
Brian Nelson, an analyst at Morningstar Inc., declined to comment on why the Eagan, Minn.-based carrier is cutting its growth plans.
Northwest, which exited bankruptcy May 31, plans to trim capacity on U.S. routes by 2 percent to 3 percent, while expanding international flights, which are more profitable, as much as 5 percent this year.
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Old 09-21-2007, 08:19 AM
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The A318 is the perfect solution! Already a solid airbus customer, could get them fairly soon, same relative size of the 9, compatable maitnance and crews from the rest of the 320 family NW already has.
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