Delta plans changes as it leaves bankruptcy behind

Delta Air Lines Inc. has undergone a major face lift during more than a year and a half in bankruptcy protection, but other changes are on the way as the nation’s No. 3 carrier exits Chapter 11 today.

Among other things, the company has set aside $10 million for a rebranding effort, its chief bankruptcy lawyer, Marshall Huebner, said in court recently. Executives also have said the airline will consider shedding Comair, a subsidiary that provides regional service.

Doug Abbey, a partner in the aviation consulting firm Velocity Group, said he expected a Comair decision soon. “I suspect that’s one of the first orders of business coming out of bankruptcy,” Abbey said.

Delta’s board also will look for a chief executive to replace Gerald Grinstein, 74, who has said he plans to step down once his successor is appointed.

Delta spokeswoman Betsy Talton said, “Additional investments in Delta’s image will be unveiled” at a news conference at the company’s Atlanta headquarters a few hours after it exits bankruptcy protection. Talton declined to give details.

Repainting its planes could help Delta with its brand image but would take time to complete for a fleet consisting of several hundred aircraft, Abbey said. “I think it’s appropriate because this is clearly a new Delta, but in and of themselves, these things tend to be a very long-term project.”

A new advertising campaign also could be in Delta’s future, Abbey said.

The initiatives would be on top of major changes Delta put in place during bankruptcy, including restructuring its fleet, expanding international service, improving aircraft cabins and cutting costs, including jobs.

On the financial side, existing shares of Delta’s stock will be canceled when the airline exits bankruptcy. Shares of new stock will be issued to creditors and begin trading publicly on the New York Stock Exchange on Thursday. That day, Delta executives will ring the closing bell from the floor of the NYSE.