Northwest Announces Orders For Seventy Two Aircraft
Airline orders 36 Bombardier CRJ900 and 36 Embraer 175 aircraft as part of ongoing fleet renewal
MINNEAPOLIS – (October 5, 2006) – Northwest Airlines (OTC: NWACQ.PK) has achieved another major restructuring milestone with the announcement of orders from two manufacturers for a total of 72 new, two-class aircraft that will each accommodate 76 customers.
The airline announced that it placed firm orders for 36 Bombardier Canadair Regional Jet (CRJ) 900s and 36 Embraer 175s that will equip Northwest with modern aircraft that offer customers a comfortable travel experience, allow the carrier to pursue growth opportunities in important markets, including in the Heartland of the U.S., and provide Northwest with improved aircraft economics.
Northwest also received options for additional Bombardier and Embraer 76-seat aircraft. Both aircraft types are powered by General Electric CF34 engines.
Bombardier Canadair Regional Jet (CRJ) 900
Embraer 175
“Today’s orders are examples of the steady progress we are making in our restructuring which is focused on resizing and optimizing the Northwest fleet to better serve customers; realizing competitive labor and non-labor costs; and restructuring and recapitalizing the airline’s balance sheet,” said Doug Steenland, Northwest president and chief executive.
“The aircraft purchases from Bombardier and Embraer allow us to tailor our service to meet market demands while providing customers with a comfortable and efficient flight experience on Northwest. Both new aircraft types will lower Northwest’s operating costs over the aircraft they replace such as the Avro Regional Jet (ARJ) 85 through a combination of significantly lower fuel consumption along with inherent maintenance cost advantages,” he continued.
The values of the orders were not disclosed.
Discussing the multiple orders, Neal Cohen, executive vice president and chief financial officer, said, “Our Bombardier purchase builds on a well-established, long-term relationship and the Embraer order introduces another highly respected aircraft product line to Northwest travelers.”
Northwest’s CRJ900 and Embraer 175 aircraft will provide a best-in-class product experience for Northwest Airlink customers. They both will be configured with 12 seats in first class and 64 seats in coach class. The 12 first class seats, arranged in a one seat-aisle-two seats configuration, will have 36 inches of pitch, or space between rows. Coach class, arranged in a two seats-aisle-two seats configuration, will have pitch comparable to other aircraft in the airline’s current mainline fleet.
The CRJ900 has a range of nearly 1,400 miles (2,253 km) while the Embraer 175 will eventually have a nonstop range of nearly 1,700 miles (2,735 km). Northwest expects to take initial delivery of both aircraft in the second quarter of 2007.
Tim Griffin, executive vice president-marketing and distribution, said, “The new aircraft are ideally suited to serve Northwest’s Heartland markets by connecting passengers through the airline’s Detroit, Minneapolis/St. Paul and Memphis hubs to the carrier’s expansive domestic and international route network.”
“In addition, the introduction of highly-efficient 76-seat aircraft into the fleet will allow Northwest to offer new service and develop markets where demand does not yet support service with a 100-seat DC9-30, but exceeds what could be accommodated with a 50-seat Northwest Airlink CRJ200.”
Discussing a future replacement for Northwest’s DC-9 aircraft, Steenland said, “We are continuing to meet with aircraft manufacturers to review our requirements for a 100-seat aircraft that would replace our DC-9s."
Northwest said that its regional subsidiary, Compass Airlines, will operate the 36 Embraer 175s as Northwest Airlink. An Airlink partner, to be determined at a later date, will operate the 36 Bombardier aircraft.
In addition, as part of the agreement to order new CRJ900 aircraft, Bombardier, GECAS and Export Development Canada have reached an agreement on restructuring the existing 126 CRJ200 aircraft fleet. This agreement includes the return of 15 previously rejected CRJ200 aircraft back into the Northwest Airlink fleet. This marks the completion of Northwest’s CRJ fleet restructuring. As a result, the Airlink fleet will total 141 aircraft.
The agreements are subject to the approval of the U.S. Bankruptcy Court for the Southern District of New York.
Northwest Airlines is the world’s fifth largest airline with hubs at Detroit, Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and approximately 1,400 daily departures. Northwest is a member of SkyTeam, an airline alliance that offers customers one of the world’s most extensive global networks. Northwest and its travel partners serve more than 900 cities in excess of 160 countries on six continents.
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