Northwest says more cuts to come in non-labor areas MINNEAPOLIS (AP) =97 Northwest Airlines, which already has cut $1.4 billion= =20 in fixed costs, can still cut in areas other than labor to trim expenses=20 while riding out the economic downturn, chief executive Richard Anderson=20 told analysts Tuesday. Northwest, which is seeking to save nearly $1=20 billion in labor costs, is looking at reducing distribution costs by=20 cutting fees paid to computer reservation systems such as Worldspan, Sabre,= =20 Galileo and Amadeus, Anderson told analysts at Merrill Lynch & Co.'s annual= =20 transportation conference in New York. Northwest will spend more than $200= =20 million this year on global distribution costs, despite reduced traffic due= =20 to the lagging economy, reluctance to fly following the Sept. 11 terrorist= =20 attacks, fears of the SARS illness and competition from low-fare carriers.= =20 "That piece is out there," Anderson said. "We've taken a lot out of=20 distribution costs but there's another chunk to be taken out of=20 distribution costs." Northwest also is looking at reducing fixed=20 infrastructure costs, which include money spent on plants and equipment and= =20 possibly fees and rents paid to airports, and will save money by expanding= =20 automation, Anderson said. The Eagan-based carrier has continued to reduce= =20 its capacity to match passenger demand and is parking unneeded airplanes in= =20 the desert, but keeping them ready to be returned to service when needed,=20 he said. In May, Northwest's traffic on Asia-Pacific routes was down 26% from a year= =20 earlier due to fears of severe acute respiratory syndrome. The airline=20 reduced capacity by 13% to help narrow the gap. "It's a matter of=20 methodically going through each one of those lines of the business. It's=20 difficult, because people don't like to change," Anderson said. "It's a=20 difficult change for an airline that's 77 years old and has done things a=20 certain way for a long period of time and then to have the reality of=20 deregulation hit the way that it hit with 9-11, the Iraq war and SARS. Some= =20 days I'm waiting for locusts," he said. Anderson declined to provide=20 specifics of Northwest's cost-cutting plan "because it's still a work in=20 progress." But Northwest does need concessions from employees, Anderson=20 reiterated. Management has met with Northwest's labor groups to discuss=20 concessions, and the unions are analyzing the company's proposals. "It has= =20 to happen," Anderson said. "In the end, costs have to be in line with the=20 revenues." Anderson also said he doesn't expect air fares to firm up=20 anytime soon and has said previously that the airline industry is unlikely= =20 to return to the days of soaring profits experienced in 1999 and 2000. *************************************************** The owner of Roger's Trinbago Site/TnTisland.com Roj (Roger James) escape email mailto:ejames@xxxxxxxxx Trinbago site: www.tntisland.com Carib Brass Ctn site www.tntisland.com/caribbeanbrassconnection/ Steel Expressions www.mts.net/~ejames/se/ Mas Site: www.tntisland.com/tntrecords/mas2003/ Site of the Week: http://www.natalielaughlin.com/ TnT Webdirectory: http://search.co.tt *********************************************************