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Like other airlines, Northwest has been hurt by soaring fuel prices. The company it is merging with, Delta Air Lines, raised ticket prices 6 percent and flew its planes with fewer empty seats.
Delta Air Lines and Northwest Airlines, preparing to merge amid a steep industry downturn, reported a combined first-quarter loss of $10.5 billion on Wednesday, most of it an accounting recognition that the two carriers are worth far less than when they emerged from bankruptcy a year ago.
Airline stocks were relatively stable Wednesday afternoon after plunging Tuesday, led by a decline of more than 35 percent at UAL, the parent of United Airlines. Northwest closed down 5 percent on Wednesday, to $7.10 a share, and Delta fell 3.5 percent, to $6.56 a share.
Across the industry, carriers are reeling from a huge increase in fuel costs — roughly 50 percent above first-quarter prices in 2007 — and preparing for a decline in demand with the economy faltering.
Delta and Northwest plan to merge, in hopes the combination would produce savings and other efficiencies of more than $1 billion by 2012. Others are in merger discussions, too. But for the industry to return to consistent profitability, airlines will need to push through big fare increases, which to date have been resisted by some discount carriers and by price-focused customers.
In the meantime, in a replay of the period after the attacks of Sept. 11, 2001, carriers will be reducing their domestic schedules, laying off workers, deferring investments in planes and other equipment, and generally hunkering down.
A handful of bankruptcies among smaller carriers already this year could grow to include bigger ones if oil remains above $100 a barrel.
As a buffer against the downturn, Delta had $2.6 billion in unrestricted cash and short-term investments and Northwest had $3.2 billion, both as of March 31.
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