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Delta: Pay cut vital for survival

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Delta wants to slash $325 million from its pilots' agreement.

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NEW YORK (CNN) -- Delta Air Lines must slash its pilots' pay and benefits to survive, since jet fuel prices are crippling the airline's finances, its chief financial officer told a bankruptcy court judge Thursday.

Delta executives spent a second day in bankruptcy court, arguing that the company must impose $325 million in wage and benefit cuts on pilots to stay in business.

Delta filed for bankruptcy in September, and CFO Edward Bastian testified that the company is losing $5 million a day -- mostly because of high jet fuel prices.

In 2000, Bastian said, the airline paid 65 to 70 cents a gallon for jet fuel. Now that price is $1.80 a gallon.

And he said increased competition, especially from low-cost carriers, is another factor hurting the airline.

Delta has lost $11 billion since January 2001 and wants new concessions from its 6,000 pilots, who agreed to $1 billion in givebacks in 2004. The company's last contract included a 32 percent pay cut for pilots, and the Air Line Pilots Association said it won't accept any more than $91 million in cuts this time around.

The union has threatened a strike if Delta succeeds in winning bankruptcy court approval to void its contract with the pilots.

Judge Prudence Carter Beatty issued no decision Thursday. The hearing is expected to resume on November 28, with Delta planning to call three more witnesses and the pilots union, 16.

-- Assignment Editor Tom Ziegler contributed to this report

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