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Northwest's Financial Status?  
User currently offlineAer Lingus From Ireland, joined May 2000, 1560 posts, RR: 0
Posted (14 years 1 week 3 days 12 hours ago) and read 1341 times:

Since I'm in Ireland and don't know the ins 'n outs of American airlines (not AA), could someone tell me how NW are doing financially, since I've read so many posts about "....not enough money" or "....in debt" ?

Thanks a lot
Martin

P.S. Happy Independance day to all across the Atlantic !

7 replies: All unread, jump to last
 
User currently offlineIflewrepublic From United States of America, joined Jun 2000, 537 posts, RR: 3
Reply 1, posted (14 years 1 week 3 days 12 hours ago) and read 1306 times:

Well, since I have sixteen years of experience with Northwest, I will try and answer this question for you. First, you have to understand that Northwest Airlines was a very frugal and very wealthy airline. They were able to pay cash for their aircraft and they were able to have a bigger payload by using very little paint. The 1969 livery did just that...most of the fuselage was natural aluminum with a big painted white section over the window areas. Directly on top of the windows was a navy blue stripe that ended just aft of the forward boarding door. Last, the tail was painted red. Anyway, in 1986, Northwest Airlines (tired of competing with Republic) purchased Republic Airlines for $884 million. This was a minor financial set back that sent Northwest Airlines into heavy debt and almost forced them to be grounded. Since Northwest is the State of Minnesota's largest employer, the State of Minnesota rescued Northwest from financial ruin. In the papers that were drawn up, the State of Minnesota included a clause stating that Northwest must keep its World Headquarters in Minneapolis until the debt is paid off (if this weren't included, NWA would have shifted its focus and emphasis on Detroit). So far, every year has been a very profitable year for Northwest and they have been able to make the payments on their debt.

The last time I checked, Northwest had something like $400 million that they still owed the State of Minnesota.

Hope that helps.

Iflewrepublic.



Aviation is proof that, given the will, we have the capacity to achieve the impossible.
User currently offlineSammyk From United States of America, joined Oct 1999, 1689 posts, RR: 0
Reply 2, posted (14 years 1 week 3 days 11 hours ago) and read 1299 times:
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Just curious, how much did Northwest actually owe in total? $400 million isn't exactly a small sum of money to have "left" to pay.

Sammy


User currently offlineNEFlyer From , joined Dec 1969, posts, RR:
Reply 3, posted (14 years 1 week 3 days 10 hours ago) and read 1292 times:

I thought I had read somwhere if American bought Northwest.. they would have to offset Northwests 3.3 billion debt.. correct me if im wrong..

NEFlyer


User currently offlineNEFlyer From , joined Dec 1969, posts, RR:
Reply 4, posted (14 years 1 week 3 days 10 hours ago) and read 1288 times:

", American would probably have to assume Northwest's $3.3 billion in debt, pushing the value of a deal to at least $8.9 billion. "

an excerpt from the news article by the associated press.


NEFlyer


User currently offlineIflewrepublic From United States of America, joined Jun 2000, 537 posts, RR: 3
Reply 5, posted (14 years 1 week 3 days 5 hours ago) and read 1268 times:

Wow! $3.3 billion! I was under the misconception that it was $400 million that they still owed...of course, when I read that I wasn't exactly reading it that closely. I think the $400 mil. is the fall out from the Republic acquisition. Or else, the $400 million is just what they owe the State of Minnesota and is the remaining debt that helped them stay afloat. (Sammy, I believe they owed something like the $884 million to MN that they paid for Republic.) Oh well...I think the $3.3 billion is the total of the acquisition price and the price for the newer aircraft and other extra niceties they employ.

Iflewrepublic.



Aviation is proof that, given the will, we have the capacity to achieve the impossible.
User currently offlineNa From Germany, joined Dec 1999, 10594 posts, RR: 10
Reply 6, posted (14 years 1 week 3 days 1 hour ago) and read 1260 times:

Are you sure about the $3,3 billion debt?
I read that a debt around that amount was what they owed to the banks at the time of near bancruptcy in ´92.
Last year I read an interview with Mr. Dasburg (CEO) and he said that most of the debt has been paid.


User currently offlineIflewrepublic From United States of America, joined Jun 2000, 537 posts, RR: 3
Reply 7, posted (14 years 1 week 2 days 5 hours ago) and read 1240 times:

Well, all I'm saying is what I read in an article from the Minneapolis Star-Tribune. The article was discussing the possibilities of American buying out Northwest and Northwest's financial situation since the Republic takeover. Like I said, I wasn't reading the article that closely since I was on my way out the door. All I do know, is that the debt is slowly being paid off.

Iflewrepublic.



Aviation is proof that, given the will, we have the capacity to achieve the impossible.
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