CEO says Delta seeks no layoffs, Chap. 11 unlikely

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CEO says Delta seeks no layoffs, Chap. 11 unlikely

NEW YORK (Reuters) =97 Delta Air Lines' chief executive said Wednesday that=
=20
he will try to avoid involuntarily laying off employees, but said the 1,000=
=20
who have applied for voluntary leaves might not prove to be enough. Leo=20
Mullin, who is also Delta's chairman, said Delta began a voluntary leave=20
program for its more than 60,000 employees two weeks ago, as the No. 3 U.S.=
=20
carrier struggles with falling bookings and widening losses as war rages in=
=20
Iraq. Most employees who applied for voluntary leaves are flight=20
attendants, he said. "Hopefully that will eliminate the necessity for=20
involuntary leaves," said Mullin in an interview after a speech in New=20
York. He added, however, "The 1,000 won't be enough in the medium term."=20
Mullin also said it is "extremely unlikely" that Atlanta-based Delta will=20
follow UAL Corp.'s United Airlines Inc. and U.S. Airways Group Inc. into=20
bankruptcy protection "in all but most hopefully unlikely of scenarios." He=
=20
said he is "fairly optimistic" that major carriers will obtain U.S.=20
government aid, which U.S. Senate Majority Leader Bill Frist on Tuesday=20
said is likely, but remained opposed to nationalizing the airlines. Delta=20
said on Tuesday it expects to report a bigger loss this quarter than the=20
$397 million, or $3.25 per share, it lost a year ago, as bookings fall,=20
competition grows more intense, and costs for fuel, insurance, pension and=
=20
security rise. On Monday it said it will temporarily cut 12 percent of=20
flights because the Iraq war is curbing passenger bookings. Delta shares=20
traded Wednesday afternoon on the New York Stock Exchange at $10.06, up 25=
=20
cents. They closed one year ago at $32.79.

SONG REMAINS THE SAME

Mullin also said Delta has no plans to delay the April launch of Song, a=20
new low-cost carrier designed to compete with Southwest Airlines, JetBlue=20
Airways and, especially in southern U.S. markets, AirTran. "Would we=20
postpone Song? No." he said in response to a question after his speech to=20
the Wings Club, a non-profit group for aviation professionals. "It's almost=
=20
a necessity (because of competition). We have to meet it even in times of=20
duress." Mullin said Delta, which had $1.9 billion of cash and equivalents=
=20
on Feb. 28, remains the most financially healthy of so-called hub-and-spoke=
=20
carriers. "In the midst of the chaos going on, we're in reasonably decent=20
shape," he said. In his speech, Mullin again pressed for elimination or=20
suspension of various airport, fuel and security taxes, and said carriers=20
should not be burdened with billions of dollars of annual costs for=
 security.


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