NWAC Northwest Airlines (MM)

Northwest CEO Urges U.S. DOT to Approve International Anti-Trust Immunity Application Among SkyTeam Partners Steenland Says Approval Is Necessary to Both Preserve and Expand Airline Alliance's Benefits for Consumers, Communities and Carriers WASHINGTON, July 21 /PRNewswire-FirstCall/ -- Northwest Airlines president and chief executive officer Doug Steenland urged the United States Department of Transportation (DOT) to approve the application of a group of airlines in the SkyTeam alliance for international anti-trust immunity. In a speech Tuesday before the International Aviation Club in Washington D.C., Steenland said approval of the application involving Air France, Alitalia, CSA Czech Airlines, Delta Air Lines, KLM Royal Dutch Airlines and Northwest Airlines is necessary to both preserve and expand the many benefits that the alliance offers consumers, communities and the carriers involved. "The Air France-KLM merger is the genesis for our pending application with DOT", Steenland explained. The application "brings together two successful and first-rate alliances (Northwest/KLM and SkyTeam) with proven consumer-friendly track records." "In order to fully preserve the efficiencies and consumer benefits of the existing alliances, it is necessary to bridge the immunities held by Northwest/KLM and SkyTeam," continued Steenland. "Linking the Northwest/KLM and SkyTeam alliance networks will generate substantial new benefits including: new and expanded trans-Atlantic nonstop service; new online connecting service in almost 9,000 markets not currently served by either of the alliances; increased pathway options benefiting 16,280 city pairs that account for almost 80 percent of trans-Atlantic travel; greater discount opportunities by allowing passengers to choose from numerous itineraries; improved time of day coverage; and reduced travel time in over 4,000 markets, representing 18 percent of the transatlantic traffic." Northwest and KLM operate a highly integrated joint venture which was granted anti-trust immunity by the U.S. Department of Transportation in January, 1993. Air France operates an alliance with Delta, Alitalia and Czech (members of SkyTeam) under anti-trust immunity granted by DOT in January 2002. Air France and KLM received merger approval in early 2004. In September 2004, Northwest joined the SkyTeam alliance of airlines as a marketing member. SkyTeam includes Aeromexico, Air France-KLM, Alitalia, CSA Czech, Delta and Korean Air. The pending application with DOT seeks to bridge the existing anti-trust immunity of Northwest/KLM and the SkyTeam carriers Air France, Alitalia, CSA Czech and Delta Air Lines. SkyTeam Application Receives Broad Support From Communities, Corporate Customers, Labor and Consumers Northwest's application has received an unprecedented array of support from a diverse group of parties including communities, corporate customers and consumers who today are already benefiting from immunized alliances among SkyTeam partners. The Air Line Pilots Association (ALPA) and the Business Travel Coalition have also filed with the DOT in support of the application. The Wayne County Airport Authority, which manages Detroit Metropolitan Airport, has seen its nonstop service between Detroit and Amsterdam grow from zero daily flights to five daily flights this summer as a result of Northwest's immunized alliance with KLM. According to a news release from the Wayne County Airport Authority, Northwest service from Detroit could well be enhanced and upgraded if the DOT approves and immunizes the agreements as requested by Northwest and SkyTeam. At Northwest's Twin Cities hub, the airport, the cities of Bloomington, Burnsville, Eagan, Minneapolis and St. Paul, as well as many local organizations, also expressed their support. As an example of the benefits that anti-trust immunity can bring to a region, Jeff Hamiel, executive director of the Metropolitan Airports Commission, which operates Minneapolis-St. Paul International Airport pointed out in a news release that before Northwest and KLM received anti-trust immunity, there were no nonstop flights between Minneapolis-St. Paul International Airport and Amsterdam. This summer, the Northwest/KLM joint venture offers three daily non-stops, totaling 807 seats. Additionally, Twin Cities' leaders argued that, with anti-trust immunity, Northwest Airlines would be in a position to provide additional European nonstop services to the community and to continue to generate economic value and jobs. Memphis, which recently celebrated the 10th anniversary of nonstop service to Amsterdam, said in a strongly worded filing to the DOT that the Northwest hub continues to be critical to the economic health of Memphis and the entire region. As a major contributor to the success of the community, Northwest also is essential to Memphis' entry into the global economic market. The Business Travel Coalition (BTC), which seeks to lower the long-term cost structure of business travel, believes the proposal, which seeks anti-trust immunity and codesharing authority, is in the best interest of large buyers of commercial aviation services. Over ninety members of the Coalition have signed a letter to DOT in support of the application. According to the Coalition, the SkyTeam proposal eliminates unnecessary and costly restrictions and addresses current competitive imbalances which limit service options. For example, the SkyTeam proposal will establish additional pathways to international destinations for travelers by directly linking U.S. and European hubs. As a result, travel times and costs for many trips will drop. Additionally, Northwest has received support from the Air Line Pilots Association (ALPA) as well as substantial corporate customer support from highly esteemed companies nationwide who conduct business in the international arena including FedEx, Ford Motor Company, General Mills, General Motors and Medtronic, to name a few. As General Motors said in its letter of support, "The Sky Team Alliance partners and other airline partnerships are a critical support to General Motors' international travel demands. If Northwest/KLM and the Sky Team applicants are allowed to operate international service with global anti-trust immunity and code-sharing, we believe the opportunity for convenient, cost- effective air transportation should be increased, and could result in advantages that should include improved flight schedules, reduced travel times, new nonstop service, and additional low fare choices." General Motors states in its filing that, "The importance of increased international travel opportunities to our country, our communities and airports, and to those of us who have business dealings with customers and suppliers throughout the world cannot be understated." In its filing to the DOT in support of anti-trust immunity and speaking specifically of Northwest and Delta Air Lines, ALPA says that, "it is concerned that the denial of the joint application could have a severe negative effect on at least one of these two carriers, and thus on the livelihood of that carrier's pilots." ALPA continues that the "loss of these [international] services, would have in addition to the negative consequences identified by the airports and communities in their answers, obvious critical adverse consequences for the carriers and their employees as well." Northwest Airlines (NASDAQ:NWAC) is the world's fourth largest airline with hubs at Detroit, Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and approximately 1,600 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. DATASOURCE: Northwest Airlines CONTACT: Northwest Media Relations, +1-612-726-2331 Web site: http://www.nwa.com/

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