Delta Air Lines' top brass met with editors and reporters at The Atlanta Journal-Constitution last week after the carriers announced their proposed merger. In this edited transcript, Delta Chief Executive Richard Anderson, President Ed Bastian and Mike Campbell, executive vice president in charge of human resources, explain the merger.

MARK LENNIHAN/AP (ENLARGE)

Delta CEO Richard Anderson.

Tom Uhlman/AP (ENLARGE)

President and CFO Ed Bastian.

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Q: The cost of fuel's killing you right now. How does this merger help you with that?

Bastian: We're not merging because of the high price of fuel. Let's be really clear about that. But the scale that the two carriers, in terms of not just the cost synergies of bringing the two companies together but the revenue benefits of hooking two networks up, will allow us to better compete in an increasingly high fuel-cost environment. There is no model out there that is going to be able to withstand a run-up of fuel from $70 to $115 [per barrel of crude oil] and be able to turn profits consistently."

Anderson: We want to be the strongest, most well-positioned [airline]. And when you think about Delta and what's missing on the route map, Atlanta and the Southeast needs to be hooked to Asia. We have big white spaces on our route network. ... So that's why it's strategically important to Delta. It fills out the rest of our map. It gives us Asia and China, which are the fastest-growing parts of the world.

Q: Can Delta survive without mergers?

Anderson: Yes, Delta can survive without mergers. But the idea is to make Delta a strong, capable world-wide airline so that it has a much stronger asset base to be able to take advantage of market opportunities.

Bastian: We're going to close [the deal] with a liquidity position [cash reserves] of about $7 billion. So when you're talking about having to compete in the high-fuel environment, you'd like to go into that environment with the strongest position. ... That's also a part of this [merger plan], to bring the two network carriers with the strongest balance sheets together to team up.

Q: You don't anticipate this merger not happening, but what if it doesn't?

Anderson: We have a standalone plan. ... It doesn't have the sort of growth opportunities that this transaction has. But we have a standalone plan that we're comfortable with. It gives us the ability to continue to slug it out, if you will.

Q: You've hit the Northwest pilots with a stick by going forward with this merger without them. What carrot are you offering to get them on board?

Anderson: Actually we didn't. ... They negotiated a contract with their company that gave [Northwest] the right to do this. ... What we were trying to do is something that has never been tried before in the industry. This is the first time ever that anyone has approached the pilots in advance of a transaction to see if we could get it all done in advance. We came close, but through no fault of any party the pilots ... couldn't reach agreement on seniority integration. ... We were disappointed we couldn't get that done. So we did the next best thing, which is get half of it done with our pilots. ... Now we want to do the same thing with the Northwest pilots.

Q: What are your chances of doing that? The reality is they're not onboard. They're making a lot of noise with their political representatives.

Anderson: Their motivation is the Delta pilots have a much better collective bargaining agreement than the Northwest pilots.

Q: How do you explain the reaction on Wall Street, where Delta's and Northwest's share prices fell after the merger announcement? Did they expect you to announce more cost-cutting measures?

Anderson: If we had announced it when fuel prices were going down, the stock price would have gone up. As fuel prices continued to soar during the day the whole industry got battered. Where I take stock is the important owners and the companies, the people who invested hundreds of millions of dollars in capital in the enterprise, these firms are pleased.

Bastian: The other thing is there had been a tremendous amount of speculation in the stock. The moment [the merger] was announced it went up. But when people began to see the impact of oil they jumped back out again. We had 32 million shares move yesterday [Tuesday]. That's 15 percent of our ownership that changed hands. When you have that type of selling pressure, [investors] taking a short-term profit, it's hard to build the kind of jump we were hoping to in terms of an announcement.

Q: Did the analysts expect you to close hubs as part of the merger as a way to trim costs?

Bastian: No. There were questions raised as to why we were not closing hubs. But strategically this is a merger of addition not subtraction. We will take the necessary steps to corral domestic capacity. We are taking those steps and will continue to take those steps even after the merged airline comes about. This is not about giving up assets. This is about taking assets and putting them together and growing something better, more lucrative and more profitable for the future."

Q: How does the merger reduce costs?

Anderson: You go to a single IT platform. You get to go to a single set of sales commission agreements with travel agencies. You have leveraged purchasing abilities. You add all that up, plus overhead reductions of the corporate headquarters staff. The sum total of all that efficiency is $600 million to $800 million [gross] a year. It will take two or three years to get there.

Q: How much headquarters staff will be cut at Minneapolis?

Anderson: We haven't made those decisions. But there's a very real incentive to keep a significant amount of employment there.

Q: What administrative jobs will be cut?

Campbell: We have to wait for the voluntary separations programs [announced last month] to run before we can decide that. [By fall, Delta plans to cut 1,300 front-line jobs through early retirement and voluntary severance and 700 administrative and management job through involuntary reductions, if necessary.]

Q: When do you guys think you will make a profit again?

Anderson: Tell me what fuel will be.

Bastian: We expect to make a profit next year.

Q: Congressman James Oberstar [D-Minnesota] has been the most vocal critic of the merger. Will you meet with him?

Anderson: At some point we will. I don't know if that's been scheduled yet.

Q: Do you think he will call hearings about the merger as he has threatened?

Anderson: There probably will be hearings, and we'll participate in them.

Q: You are trying to blend a lot of [Northwest's] union employees with a lot of non-union employees [at Delta, which is mostly non-union]. How do you do that?

Anderson: It's always a leadership challenge when you undertake putting two big companies together. But step back and look at what you're creating, for the long term, for the employees, for the city of Atlanta, for the state of Georgia, for the customer base we have. It has a tremendous value for them. The only true job security is to work for a thriving, growing company. And that's really what we're going for.

Q: Delta serves Coca-Cola; Northwest serves Pepsi. Will it be Coke or Pepsi on the new Delta?

Bastian: It'll be Coke. That's not a hard one.

— Compiled and condensed by staff writers Russell Grantham and Jim Tharpe