GE, Airbus Give NWA a $500-Million Loan : Transportation: The deal may have clinched recent major orders for the aircraft firms.

Northwest Airlines’ parent company, heading into a tough earnings period sparked by the fuel crisis, got a $500-million loan from General Electric Co. and European aircraft maker Airbus Industrie.

The loan agreement may have given Airbus and GE an edge against competitors in recently securing a deal to sell Northwest 75 new Airbus A-320 aircraft, with options for 30 more. Seattle’s Boeing Co. also was competing to supply planes to Northwest.

Alan Boyd, chairman of Airbus Industrie of North America, confirmed Thursday that the loan to NWA Inc. was arranged during negotiations over the $4.6-billion aircraft order.

He declined to say how much of the $500-million loan came from Airbus and how much from GE.

GE’s involvement is through CFM International, a venture it has with a French aircraft company. The GE engine order for the new Northwest planes is valued at $1.3 billion.

Boyd declined to comment on a separate offer by Airbus to help finance the union-led buyout of UAL Corp., the parent of United Airlines.

No details of the offer have been announced. The unions, whose members include the pilots, mechanics and flight attendants, are looking for investments from aircraft manufacturers to help finance their proposed $3.9-billion bid.

Financial support from aircraft makers is unusual, but not unheard of. In 1987, Boeing set the precedent by investing $700 million in UAL to prevent a takeover of that airline by its pilots.

Such arrangements have put McDonnell Douglas Corp. at a competitive disadvantage because it cannot afford to make such investments in potential customers. McDonnell Douglas has told United’s unions it will not be able to invest in the airline.

The deal with Northwest reduces the chance that the carrier will face a cash crunch during a period of sharply higher fuel prices and soft domestic passenger traffic.

Northwest says its fuel bill this year could rise by $180 million.

To cope with higher fuel prices, Northwest--along with the rest of the industry--raised fares 5.3% last month, and plans another 4.2% increase for Oct. 1.

But Northwest must get over other financial hurdles.

For one thing, the carrier faces a Sept. 29 deadline from the Transportation Department to find a replacement for $225 million of a $400-million equity investment by KLM Royal Dutch Airlines, although the government might grant the carrier an extension.

KLM’s investment helped Los Angeles investor Alfred A. Checchi gain control of NWA last year, but the government ruled that KLM’s investment was too large and gave foreigners too much control of a U.S. airline.

Northwest spokesman Doug Miller said Checchi, NWA’s chairman and majority owner, is “exploring his options.”

Besides asking for an extension, those options include finding new partners or an infusion of cash from Checchi, Miller said.