Northwest fuels huge losses

Northwest Airline, America’s fourth largest air carrier has accumulated a loss of $1.1 billion in the first quarter. The losses are mainly attributed to increasing fuel costs and costs associated with its bankruptcy reorganisation. The fuel expenses increased to 18% to reach at $744 million, despite the fact that Northwest Airline had reduced its consumption by 13%. On the flip side the labour costs were reduced by 30% to $676 million, thus reducing the total operating expense by 6.2%. Though the company is successfully carrying on the restructuring process, it would take some time to position the company for long term success.

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Source IIPM-Editorial,2006