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Delta Seeks To Outsource 200 IT Jobs to IBM

Delta Air Lines Inc. asked a bankruptcy judge Tuesday to let the nation's third-largest carrier use IBM Corp. rather than its own employees to maintain its computer systems.

Delta Air Lines Inc. asked a bankruptcy judge Tuesday to let the nation's third-largest carrier use IBM Corp. rather than its own employees to maintain its computer systems.

Delta spokeswoman Betsy Talton said the outsourcing agreement, if finalized and approved by the court, would result in "substantial savings" for the Atlanta-based company, though she declined to say how much.

About 200 of the 1,800 employees in Delta's technology unit would be affected, though it's unclear how many might lose their jobs. Often in such arrangements, some employees transfer to the company to which the work is being outsourced.

Terms of the deal with Armonk, N.Y.-based IBM were not disclosed in the court filing. An IBM spokesman declined to comment.

A hearing on the request, if necessary, is set for Aug. 22 in U.S. Bankruptcy Court in New York.

Delta said it solicited proposals from several computer service providers, though it didn't name the others. Delta's computer systems run a variety of applications including customer reservations, company record-keeping, communications, flight management and maintenance tracking services, the filing says. Under the deal, IBM would be responsible for operating and maintaining Delta's mainframe and other computer hardware.

"The agreement will allow Delta to take advantage of IBM's computer expertise so that Delta can focus its restructuring efforts on air transportation, and entering into and performing under the agreement will lead to cost savings for Delta," the airline said in its filing.

Delta has streamlined costs since filing for bankruptcy last September. It currently outsources some reservation tasks to India.

The airline has also cut jobs, restructured aircraft leases, negotiated concessions from its pilots and imposed pay cuts on other employees. It is seeking to terminate its pilots' pension plan effective Sept. 2.

Delta expects to emerge from Chapter 11 by the middle of 2007. It is scheduled to report its second-quarter results and file its monthly operating report for June on Wednesday.

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Reader Comments:

Wed, Aug 16, 2006 Anonymous Anonymous

Been there, done that. If present level of service is 8 out of 10, the IBM service will be 2 out of10. A former employer went that rout. The 2 hours response was a phone call. If a tech showed up in 3 days it was considered a mirical.

Every manager had to purchase a spair desk top and a lap top because service was so slow.

Not directly involved, I herd backups went to He!!.

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