Delta, Northwest file for bankruptcy

Spike in jet fuel sparks filings, putting almost half of U.S. airline capacity in Chapter 11.

NEW YORK (CNN/Money) – The airline industry’s five-year financial crisis came to a head Wednesday evening as Delta Air Lines and Northwest Airlines, two of the nation’s largest carriers, both filed for bankruptcy.
Delta, the nation’s No. 3 airline, filed first.

Northwest, the No. 4 carrier, followed within minutes.

Both cited the recent spike in jet fuel costs, which have soared nearly 20 percent since June 1, as prime reasons for seeking protection from creditors under Chapter 11 of federal bankruptcy laws.

“This is a coincidence, but what a coincidence,” said industry consultant Michael Boyd. “This is another 9/11. Most carriers adjusted to that, but now we have another 9/11 that’s called fuel. And we have another half of a 9/11 called pensions.

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