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Delta grounds jet orders
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January 17, 2002: 4:14 p.m. ET
No. 3 airline delays delivery of 39 jets through '03; speeds retirement of 727s.
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NEW YORK (CNN/Money) - Delta Air Lines announced it is postponing delivery of 39 new jets this year, and will accelerate the retirement of the remaining Boeing 727 aircraft in its fleet.
The nation's No. 3 airline said it will take delivery of 13 of the aircraft purchases it had planned for the year and next, but that 20 aircraft for which it had firm orders and another 19 for which it had options will be delayed.
The aircraft affected are all from Boeing Co., the world's largest aircraft manufacturer. The models affected are the 737-800, the newest version of its narrow-body jet, and two wide-body jets, the 767-400 and the 777.
The 727 jet was last built by Boeing in 1984. Delta said it had originally intended to phase the aircraft out of service by early 2005. Now it intends to complete its replacement by late 2003. Its Web site says that it has 67 of the 727 jets with an average age of 22.4 years old.
All major airlines cut new aircraft deliveries and grounded some of its older, less fuel efficient jets in the wake of the Sept. 11 terrorist attack, which sharply curtailed demand for air travel. Airlines have also been scrambling to preserve cash as most cope with mounting losses. Analysts surveyed by earnings tracker First Call expect Delta to report a fourth-quarter loss of $3.89 a share, and a full-year loss in 2002 of $2.51, after losses in the first two quarters of this year.
"These actions demonstrate the flexibility of Delta in these tough times," said a statement from Delta's Chief Financial Officer M. Michele Burns. "We are aggressively controlling costs while making careful investments in Delta's future."
Shares of Delta (DAL: down $0.65 to $29.05, Research, Estimates) closed lower in trading Thursday a day that saw most airline stocks losing ground.
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In a separate series of announcements, Delta announced Thursday it would increase service offerings by its Delta Connection feeder airlines, which use lower cost, lower-capacity regional jets for their service.
Among the routes that will now have regional jet service are Jacksonville and New York's LaGuardia Airport, as well as between the airline's Cincinnati, Ohio, hub and Chicago, Harrisburg, Pa.; Kansas City, Mo. and Jacksonville, Fla.
Delta Connection carrier Comair, a wholly-owned subsidiary of Delta, cut back its route structure when it resumed operations after a pilots strike last spring. 
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