=20 ---------------------------------------------------------------------- This article was sent to you by someone who found it on SFGate. The original article can be found on SFGate.com here: http://www.sfgate.com/cgi-bin/article.cgi?file=3D/news/archive/2004/08/18/f= inancial0129EDT0012.DTL --------------------------------------------------------------------- Wednesday, August 18, 2004 (AP) CEO: More job cuts ahead at Delta Air Lines HARRY R. WEBER, AP Business Writer (08-18) 22:29 PDT ATLANTA (AP) -- More job cuts are in store at Delta Air Lines as the struggling carrier tries to avoid bankruptcy court. Chief executive Gerald Grinstein told employees about the personnel reduction in a memo Wednesday after a daylong meeting with Delta's board to unveil his recovery plan. He did not specify how many positions would be cut. Atlanta-based Delta has already laid off more than 16,000 since the 2001 terror attacks. The nation's third-largest carrier has lost more than $5 billion amid high fuel costs and stiff competition from low-fare airlines. As of June 30, the company and subsidiaries employed 70,300, including 7,500 Delta pilots who have been asked for $1 billion in contract concessions. "When our plan is successfully implemented, we will be the leaner, simplified, more productive airline we must be in order for us to survive and compete," Grinstein wrote. "Regrettably, one of the consequences will be fewer jobs and additional changes to pay and benefits for all of our employees as we make operational changes to achieve the necessary cost savings," the memo said. Earlier Wednesday, Delta said it is considering exchanging some of its $= 20 billion debt, possibly for equity in the company. The proposal involves certain equity certificates issued by investor groups that lease aircraft to the airline to assist in financing the planes' cost. Delta is asking the holders of those certificates to remove restrictions preventing the carrier from buying or holding the securities. One option Delta is considering is a debt-for-equity exchange, according to a summary of the proposal provided Wednesday to The Associated Press. On Thursday, Delta officials were to meet with the pilots union, which h= as offered up to $705 million in cuts. In exchange for considering the company's concessions proposal, pilots want a stake in the airline -- and a voting seat on its board. The union has asked that pilots get a stake in the company either through profit sharing or stock options, union spokeswoman Karen Miller said. In his memo to employees Wednesday night, Grinstein said he presented to the board an employee reward plan that includes a combination of equity, profit-sharing and incentive payouts tied to performance and productivity. He did not offer details. Delta's board met earlier Wednesday under enormous secrecy with leaders = of the struggling carrier to hear the highly anticipated turnaround plan. Company officials would not say where the board meeting was held, how long it lasted or offer details of what was discussed. Among the proposals Grinstein was expected to outline: developing a simpler fare structure or a loyalty program and higher performance standards and better training for employees. Grinstein told employees last month that Delta plans to seek new markets, domestically and internationally, and new customers either alone or in a partnership. In addition, the airline will look to leverage assets and to deploy them in more profitable ways, he said. On the Net: www.delta.com ---------------------------------------------------------------------- Copyright 2004 AP