Northwest Seeks Court's Help

(AP)  Northwest Airlines Corp. filed a motion Wednesday to have its labor contracts rejected if it can't agree to new terms with its unions. The move was expected as the company works through Chapter 11 bankruptcy.

Northwest wants to cut $2.5 billion in costs, including $1.4 billion annually in labor costs.

Doug Steenland, the airline's president and chief executive officer, called the filing in New York bankruptcy court a "backstop" to negotiations for consensual cuts.

The airline outlined new targets for union concessions in the filing, and said salaried and management employees would also take a second round of pay and benefit cuts soon.

Northwest previously announced plans to reduce its flight schedule, and the airline expanded on that in the filing, describing it as "right-sizing the airline."

Northwest expects fourth-quarter mainline capacity to be cut 7 to 8 percent from the period a year ago, with domestic flights cut more sharply than overseas routes. More schedule reductions are planned starting in January, tentatively 11 to 13 percent of capacity compared to a year earlier.

The schedule may eventually be cut as much as 15 percent or more, Northwest said.