Airlines, Inc. 
 NORTHWEST AIRLINES, I N C . , ~ ~ 
19 5 4 
PROGRESS FOR THE LATEST 10 YEARS 
Ca lendar 
Tota l 
Passenger 
Express Revenue Mail Total 
Operating and Freight Passenger Ton Plane Mi les 
Year Revenue Revenue Revenue Miles Miles Flown 
1954 $63,595,851 $51 ,053 ,599 $4,676,190 909,674,550 6,990,462 27,029,860 
- 
1953 66,140,027 48,652 ,465 4,890,1 53 851 ,174,754 5,002,605 27,816,827 
1952 61 ,552 ,380 41 ,962 ,758 4,781 ,08 i 720,046,264 5,017,993 23,210,634 
1951 54,685,060 35,192,765 4, 37 1,533 602,220,853 4,571 ,276 19,531,632 
- - 
1950 52 ,456,700 33,148,395 4,1 22,222 613,446,244 4,987,561 26,868,177 
1949 39,970,747 27,873,942 3,163,278 495, I 14,870 4,722,800 25,908,552 
1948 34,369,835 24,074,778 2,072,362 386,509,809 4,026,074 22,288,002 
1947 26,800,428 20,520,631 1,019,497 382,544,382 2,736,938 20,824,912 
1946 19,976,204 18,062,492 553 ,875 385,858,473 2,049,659 19,304,234 
1945 I 12,196,652 I 0,060,619 409,613 
I 
218,469,773 2,698,378 12,870,714 
 TO SHAREOWNERS OF NORTHWEST AIRLINES, INC. 
The r port of the independent auditor and 
the financial statement for 1954 ar presented 
herewith. 
EAR INGS 
Net income from operation after taxe and 
before prop rty dispo al amounted in 1954 to 
'2,203 144 and howed a substantial gain o er 
net incom of $1 339 503 in 1953. 
Net income from pro pert di po al after 
taxes amounted to $212 380 in 1954 compared 
with $605,190 in 1953. 
The total net income for 1954 wa $2 415 524. 
Pr erred dividend amounted to $429 554 
lea\ ing $1 985 970 or $2.38 per hare for th 
834 933 out tanding shares of common tock. 
In 1953 total net income wa $1 944,693 of 
which $1,510 482 or $1.84 per har wa ap- 
plicable to the common stock. 
If we exclude from 1953 operatino- revenu 
OTO income deriv d from op rating an airlift 
o er the Pacific for the Unit d tate Go ern- 
m ent in that y ar, commercial revenue how 
an increa e in 1954 of $1640413 ov r 1953. 
Combined with the de elopment of re enue 
th company put into effect a co t I duction 
program which reduced total xp n e below 
1953 even though 10.2 ~ more availabl ton 
mile were offered for sal in 1954. Our a\ erage 
ystem unit operating co t per available ton mile 
wa reduced 9.5 ~ from 1953. 
Durino- 1954 1 199 193 re\ enu pa enger 
"'er carried on the ntire y tern ( <lorn tic, 
Ori nt and Honolulu rout ) an incr a e of 
9.1 ~ ov r th previou hio-h in 1953. Re nue 
pa ng r mile in 1954 total d 909 674,550 an 
incr a e of 6.9 ov r 1953. 
For the fir t time inc 194 7 our corn pan at 
th nd of 1954 had no out tandin bank loan 
nor oth r long t rm d bt . Th compan b - 
came debt fr on Octob r 29 wh n it paid ofl 
in ad anc all oblio-ation to bank . Your com- 
th only major trunk arri r hich "' a 
a ofth ndof1954. 
n $18 million bank r dit a r m ,nt 
h b n arran d whi h will pro\ id fund for 
th acqui ition of four Lo kh d 1049 ) on- 
t Ila ti n aircraft a. w 11 a additional Dou la 
D -6B air raft whi h our cornpan ' i 
h fir. t l orro, in und r th n bank r dit 
agreement wa made on J anuar 28 in the 
amount of $2 500 000. A of March 7 1955 
your company ha borrowed 6 500 000 under 
th new agreem nt. 
NET O H 
Th net worth of the company at the end of 
1954 wa $26 829,107 of which $21.11 per 
har wa applicabl to th common tock. 
Thi compare with 24;736 702 at the end of 
1953 of which 15 359;827 or '18.71 wa ap- 
plicable to the common tock. Our arned ur- 
plus wa $6275 889 at the nd of the )ear 
compar d with $4 289,91 at th end of 1953. 
P F RED DI 
Divid nd on the --1.60 umulati\ e Prefer- 
nc tock ar no," paid up to date. The quar- 
ter! di id nd which had be n due F bruary 1 
and Ma 1 1954 w re t mporaril) ithheld in 
the light of the op ratin r ult for the fir t 
part of the ear but the , er declared and 
paid wh n it became apparent that the general 
financial ituation wa impro\'in . The di i- 
dend due O\ mber 1 1954 and F ebruar 1 
1955 w re paid on their due dat . Pr f rred 
dividend are cumulati\e and mu t b paid be- 
fore any <livid nd can b paid on common 
har 
ROU ES 
On February 16 1955 the Civil A ronautic 
Board i su d d ci ion in the Tran pacific Cer- 
tificate Ren wal Ca e and the , t Coa t- 
Ha waii Ca in accordance with in tru tion 
from th Pr id nt. In th Tran pacific ca 
th Board authoriz d your company to r e 
Portland attl Anchora e and Japan ov r 
th r at Circl Rout for a p riod of \ n 
y ar . Th authorization to r\' Okina a 
Formo a Hon  Kono- and th Philippin "'ill 
continu in ff ct for a p riod of fi\ ar , and 
the authorization to rve point within Kor a 
will continu for a p riod of thr y ar . In th 
W t Coa t-Hawaii th Board revi d 
ord r authoriz ur omp ny to ontinu 
 b tw tl a m -Portland nd 
Honolulu for a p ri d f thr Y r and 1 
authoriz d f ntinuati n 
of omp titi, 1Y1 n thi: run by 111 thcr 
m n an rn r. Y ur c mpany h1d urg cl 
 REVENUE PASSENGER MILES 
For Latest Ten-Year Period 
1945 
1946 - 
~ - - - - - - -  
1947 ~: 
----1111!1! 
1948 
~~ 
~ ~~! 
1950 
~-~ 
1951 
~ 
~9'-i 
~--! 
1952 . ' 
1953 ~ - - : 
~ 
~-- 
100 200 
- DOMESTIC 
300 400 500 600 700 800 
MILUON MILES 
~ INTERNATIONAL 
(Includes ope rof,ons to Afoslco, the Orient , and HowoiiJ 
that the certificates be issued on a permanent 
basis inasmuch a it had pioneered and devel- 
oped the Great Circle Route to the Orient and 
because traffic volumes have shown a very fa- 
vorable growth trend and because the cost to the 
Government in the form of subsidy requirement 
i being rapidly reduced. However, they were 
granted on a temporary basis and the matter 
of service to Shanghai and other points in Com- 
munist China a well as the application ( op- 
posed by your company) of a competitive 
American carrier for authority to operate over 
the Great Circle Route to points in the Orient 
were deferred for po ible future consideration. 
In the Wet Coast-Hawaii Case your com- 
pany offered to operate the route between 
Seattle/ Tacoma-Portland and Honolulu on a 
non-sub id basis if it were the sole operator on 
the route, and the Civil Aeronautic Board 
unanimou ly recommended to the President 
that your company should be given the sole 
rio-ht to operate thi route on a permanent basis. 
Deci ion have not yet been rendered on the 
recertification of your company's right to op- 
rate the o-called "inside" route to Alaska from 
ew York and Chicago to Anchorage Alaska 
via the Twin Citie of Minneapolis and St. Paul, 
and Edmonton, Alberta. Thi decision a well 
a that on your company's right to operate 
local ervic bet"een Seattle/ Tacoma, Wa hin - 
ton and Anchorage laska will be made in the 
pending tat -, la ka Ca 'e. Your company i 
hopeful that the adrnn tage inherent i 1 th 
operation of the "inside" route to Anchorage 
will again be recognized as longer range aircraft 
are used and transpolar operations become more 
prevalent in the future. 
Ultimate decision in matters involving inter- 
national routes rests in the President of the 
United States. 
Your company is also seeking certification to 
operate between Chicago and ew York and 
between Chicago and Detroit, as well as the 
removal of restrictions which prevent the op- 
eration of local turn around flights between De- 
troit and New York. Hearings on this matter, 
designated as the ew Yark-Chicago Service 
Case, were held in 1953, but decision has not 
yet been rendered by the Civil Aeronautics 
Board. 
Hearings likewise were held in 1953 on your 
company's long standing Cleveland-New York 
application. No decision on this application 
ha yet been made by the Board. 
EQUIPMENT AND SERVICE 
Three Douglas DC-6B aircraft were acquired 
during the year bringing our total DC-6B fleet 
to seven. Continuing efforts are being made to 
acquire additional DC-6B aircraft. 
We have now taken delivery on three new 
Lockheed 1049G Constellation aircraft and 
expect delivery on the fourth Constellation, 
TOTAL REVENUE TON MILES FLOWN 
For Latest Ten-Year Period 
1945 
-- 
1946 
~ 
-- 
1947 
~ 
t - - - - - 
1948 ~~ 
.---- 
1949 ~~! 
-- 
1950 ~~~ 
-- 
195 1 ~~~ 
- 
1952 ~~~ 
t - - - - - 
1953 ~~;~ 
-- 
1954 
~~ .~.~ 
0 10 20 30 40 50 60 70 80 90 
MILLIONS OF MILES 
- DOMESTIC 
~ INTERNATIONAL 
(Includes operot,oru lo Alailco, the Onent, and Ho wo11 } 
 \ hich complete our order with Lockheed be- 
fore April 15, 1955. Thee aircraft po\ ered b 
, right Turbo Compound engine , will be flov n 
exclusi\ el in international operations. These 
luxuriou plane ,, ill enable our compan to 
offer it customers the finest and fastest er ice 
bet, en the nited States and the Orient and 
to Rav aii. All of these aircraft ill offer a 
choice of fir t cla or touri t accommodations. 
Constellation er ice between eattle/ Tacoma 
and Anchorage commenced in F ebruar and 
ser ice bet\ een Seattle/ Tacoma and the Orient 
started on March 4. By the middle of April 
four , eekl round trips will be operated be- 
t een the nited State and Tok o and Manila 
with Constellations. ,1 
\ 
e expect to ha e Con- 
stellations on three weekl round trips betvveen 
Seattle/ Tacoma-Portland and Honolulu by 
arly ay. 
In addition to the Constellation schedules 
your company plans to continue its present 
twice weekl cargo and mail service between 
the United State and Tok o with DC-4 or 
DC-6B aircraft. In addition to the three eekl 
Constellation schedules to Honolulu there will 
be one DC-6B eekly schedule. 
Boeing Stratocrui ers are being u ed in first 
clas operations on man segment of our do- 
me tic routes. In addition, our compan pro- 
ides first cla Douglas DC-6B er ice, and 
coach chedules are flown by both Douglas DC- 
6B and Dougla DC-4 aircraft. Coa t to coast 
one top Dougla DC-6B coach service be- 
tween ew York and Seattle v a inaugurated in 
1954. e ha e al o inaugurated an O\ ernight 
freight er ice between ew York and Minne- 
apolis/ St. Paul ia Mil aukee to provide earl 
morning deli erie of cargo to customers in the 
mid est. e ha e entered into an interchange 
agreement v\ ith Ea tern Air Line , effecti e 
Dec mber 15, 1954 hich provides dail 
Bo ing Stratocrui er r ice between 1inneap- 
oli / t. Paul and Miami via Chicago. Under 
the arrangem nt tratocruiser manned b your 
compan er on the Twin Cities-Chicago 
egment and by Ea tern ir Line ' er w on th 
Chicago- iami egment are flo n one round 
trip each da from inneapoli / St. Paul to 
Miami. During the ummer month Eastern 
ir Line ' Con t llation equipment will b 
flo n on th int r h n  ervice. It i xp cted 
that additional frequenci s will be provided -on 
the interchange er ice a the olume of bu i- 
ne grow. 
eve1 al month go om compan mad 
a\ ailable a means of financing th ale of pa - 
enger air transportation on an installment pa - 
ment ba is. Thi plan i popularly known a 
Fly ow Pay Later. The plan enable a 
prospecti air traveler to make a trip by air 
after ha ing made a mode t dm n pa ment 
\ ith the pri ilege of pa ing the balance of the 
price of the ticket over an extended period of 
time thu allo'wing man person to enjoy the 
advantage of air tra el VI ho \,vould not other- 
wise do o. 
MAIL RATES 
International- The Civil Aeronautic Board 
reopened our international mail rate a of Jan- 
uary 1, 1954. To date only preliminary di cu- 
sions ha e been held regarding settlement of 
thi 1 ate. Pending uch finalization a temporar  
rate of 4,913,000 per ear has been establi hed 
b the Board for all of the compan ' interna- 
tional services. The actual payment of thi 
amount is di ided into two parts-service pa 
and ubsidy. Service mail pa is calculated on 
the ba i of U. S. mail ton miles carried and is 
paid by the Po t Office Department. The re- 
mainder is considered ubsid and is paid b the 
Civil Aeronautics Board. 
During the past ear ub tantially increa ed 
olumes of U. S. mail carried by orth\Ne t in 
its international ser ices ha\ e resulted in a harp 
decline in ub id pa ment from the nited 
State Government. In December 1953 th 
total ub idy mail pay for our entire interna- 
tional operation as $381 000 and in Decemb r 
1954 this total had declined to $92,434 a de- 
cline of 76%. The reduction , as accomplished 
in spite of the fact that the ser ice mail rate 
for int rnational mail wa lm ered b the CAB 
in December 1954. Had the pre iou mail rat 
V) 
LONG TE RM DEBT 
Including Current Liabilit y Portio n 
20 ~~-.-..-....--.---r-,-::::r-..-,-....--.--.-,~.--.-.--:-- 
. '. --,--,----:---:--:--r-r-i 2 0 
~ 15 _.-..:~ ~..:.....,..~~.:-+~ ~~;.._.;._+--:-' --:-' ~-+--:---:-' -t- 
' --t---T-115 
0 
a 
0 10 -i---i~ t-+++-+-i-+--+-++-+--+-i-t-'~y+ 
 -+ 
' -+ 
0 
-t-t-T-- 
' :' 1:1 10 
~ s ~~.i-.:...~~~~~~~;.._;_+--:-~-+--:---:-~-:-1 
~ 
0 : : : : : : : : : : : : : ' 0 
- 1948 - 1949 - 950-1 5 -1952- 953 --1 954 - 
 been in effect during December, the reduction 
in ub idy would have been 86% . 
Thi downward trend in Government subsidy 
paym nts wa accompli hed before the Govern- 
m nt announced it policy of increasing the vol- 
ume of Army Po t Office and Fleet Post Office 
mail for commercial airlines. The trend toward 
lower ubsidy will be greatly accelerated by the 
Government's decision to divert large volumes 
of air mail from military planes to the commer- 
cial airlines. Your company will be one of three 
. international airlines to which the bulk of 
this increa ed mail will be a signed. Thus, it is 
po ible that in the near future your company 
may completely eliminate its need for subsidy. 
The volume of mail carried in international 
ervice in February 1955 resulted in subsidy free 
operation for that month. 
Domestic- As of April 1, 1954 the Board 
reopened domestic mail rates of all trunk car- 
rier . Under the terms of rates proposed by the 
Board our domestic mail revenues would be re- 
duced approximately $192,000 or 13 % an- 
nually. Domestic mail pay for the industry 
would be reduced about 11 % . We have re- 
duced our domestic mail revenues on the books 
to agree with the rates indicated by the Board. 
In the latter part of 1953 the Post Office 
Department inaugurated an experimental pro- 
gram of flying 3c first class mail between certain 
major cities via commercial airlines. The first 
phase of the program did not include any of 
the pair of cities served by Northwest. How- 
ever, m ovember 1954 the experiment was 
extended to include north-south service to sev- 
nteen Pacific coast cities in California, Oregon 
and Wa hington. Your company has joined in 
that program and participates in the lift of 3c 
first clas mail between Portland and Seattle as 
a part of the west coast mail operation between 
an Diego and Seattle. Success of this type of 
mail operation in the areas tested thus far indi- 
cat that further expansion can be expected. 
Prior Years- Our mail rates, both interna- 
tional and dome tic for the calendar year 1951 
ar till open and therefore, are subject to set- 
tl m nt with the CAB. Rate for the years 
1952 and 1953 and for all year prior to 1951 
ar clo ed. 
PERSONNEL 
Cooperative relations and understanding be- 
tween management and its 5,000 employee 
have reached a new high. 
Contract negotiation during 1954 were con- 
ducted within an excellent employee relation 
.1.tmosphere in which atisfactory understand- 
ings were reached providing for fair and equi- 
table working conditions and rates of pay. 
The company training program is continually 
being strengthened and improved. Increased 
on-the,..job and off-the-job training was pro- 
vided to technical, maintenance and flight per- 
sonnel with particular emphasis on training 
needs relative to the integration of new types of 
equipment into our fleet. Intensive training of 
sales and station personnel made a substantial 
contribution to improved service to our custom- 
ers. Special stress will be placed on administra- 
tive and supervisory training during 1955. 
Your management believes that it has one 
of the finest groups of employees in the airline 
industry. It is proud of their work performance 
and their demonstrated interest and loyalty to 
their company. This fine attitude on the part 
of our employees has been a great factor in the 
increased efficiency of our operation. 
MANAGEMENT CHANGES 
Your directors elected Donald W. N yrop a 
president of Northwest Airlines, Inc. effectiv 
September 2 7. Mr. N yrop comes to your com- 
pany with an extensive background in aviation 
affairs having been chairman of the Civil Aero- 
nautics Board, counsel for the Conference of 
Local Airlines, and having served in other 
executive capacities in the aviation industry. 
Two Minneapolis business executives Lyman 
E. Wakefield, Jr., Vice President of First a- 
tional Bank of Minneapolis, and James H. 
Binger, Vice President of Minneapoli -Honey- 
well Regulator Company, both of Minneapoli , 
Minnesota, were named to the Board of Direc- 
tors. Leo G. Jacques, President and General 
Manager of Motor Products Corporation of De- 
troit, Michigan, re ign d from the Board of 
Director . 
By authority of the Board of Director 
Mar h 7, 1955 
, t. Paul Minne ota Chairman of the Board 
 FIVE YEAR STATEMENT OF INCOME 
( mounts shown in thousands) 
NORTHWEST AIRLINES, INC. 
Five years ended December 31 , 1954 
OPERATING R E F 
,NUE 195-1 
Pa ng r ......... ... ..... ... ....... ...... ............... ..... ................ .. ..... $51,054 
Unjted States mail .............................................................. 6,282 
For ign mail ........ .. ........ ... .. .............................. .............. .. .. 504 
Expre , freight, and xce s baggage .. .. . . . .. . . .... . . . ... .. . . ... .... 5 296 
Charter and other transpo'l"ta tion.. ... ... . . .. . . . . .. . . ... .. . . .. ......... !" 
0 
Pacific airljft for United Sta t Go ernment ... ................ . 
Repair and 6ervi income rent~ etc. net 
OPERATING EXPENS ES 
10 
$63,596 
Fl ing an d ground operations .......................................... $30 OH 
M aint nan and repair .... ............................................... 11 ,672 
Pro j ion for depreciation............. ................................... .606 
Traffic, sales, and adverti ing ............ ........ ... .. ..... ............ 7 383 
Admini trative and general (including pay r ll taxe 
proptrty taxes, etc.) . . .. .. .. . . . .. . .. . .. . . .. . .. . .. . .. . . . . .. . . .... .. . . . .. . .. 4 180 
OTHER D EDUGT10 ET ............ ........ ,,,,,, ................... ,., ... . 
$58 885 
$ ~ 
108 
I coME FROM OPER Tio BEFORE I Nco11rn T ,F.s ...... .. $ 4,603 
INCOME TAXE , on jncorne from opera tion ........................ 2,400 
ET INCOM E FRO I PF.RATION ...... ............................. .... .. $ 2,203 
I COME FROM Di PO AL _ OF PROP ERTY ..................... ...... $ 28 7 
L es applicaJble incom taxes ....... ..... ............. .. .... .. ... ... ... 75 
NET IN COME (Los ) FROM Di, PO, AL OF PROPERTY ...... $ 21 ( 
P r ent 
Increa e 
(De rease ) 
195 '.l 
1954 to 1953 
4.9 0 
$+8 65- 
( 8.5 ) 6,869 
I .6 496 
( 1.4 ) 5,373 
( 72.2 ) 180 
( 100.0 ) 4,1 85 
6.5 385 
( 3.8 ) $66.1 +o 
( 5.5 ) $31 ,801 
( 15.9 ) 13,886 
( 2.2 ) 5,731 
.8 7,324 
( 1.8 ) 4,255 
( 6.5 ) $62 997 
49.9 $ 3, 143 
68.0 338 
64.I $ 2 805 
63.8 t 465 
64.4 $ 1,340 
( 64.8 ) $ 815 
( 64.3 ) 210 
( 65.0 ) $ 605 
1952 1951 19~0 
$- 
H 6.1 $ 5 193 $33 1-18 
6,767 7 789 9,9..>8 
706 620 ".3 2 
5,116 4,648 t.j. 388 
1,055 '.105 _27 
5,464 5. 72-1 3, 70 
481 40 25..J 
$61 552 $54.685 $"2 45 7 
$28 37 1 $-5 - -6 $2+,94-1 
15 061 11 ,837 I_ 025 
5.816 5,429 5.87:1 
6 504 5,482 5 ,1-26 
4 294 3,651 , 386 
$60,0 1-6 $51 625 $51 654 
$ 1,506 $ 3,060 $ 803 
3 1 67 73~ 
$ I 195 $ 2,393 $ 68 
640 601 ( ) (A) 
$ 555 $ 1,792 $ 68 
$ 1.709 $ 592 $ 199 
475 599(A) (A ) 
$ 1 234 ($ 7) $ 199 
ET INCOME FOR THE YEAR  ..  ...  ........................... $ 2,415 24.2 $ 1 945 $ 1 789 $ 1,785 $ 267 
NOTE A- Ta.xes on incom we-re red u c-d as a re, ult of th e arry-f0rward of the 1948 operating loss: $225. 1951, $135,00 1950. 
Income from disposals of pr pcrty dl!ring the years 1948 th rough 1950 reduced by $836,487 .the operating loss rnrry-fon.vard 
t,, 
195 1. In om c taxe of $429,000 apphc hle theret o have bce :1 trentt:d 111 195 1 as allocable to ,n omc fr m disposals of p,opC'rt . 
 NORTHWEST (),ci,e"1,t AIRLINES 
SYSTEM MAP 
Routes Operated 
      Proposed Routes 
- - - - - Routes Certified but not Operated 
Connecting Airlines 
Through Plane Service 
PEI Pl MG 
/\ 
/ 
/ ~ 
MUKDE N 
CHINA / 
/ 
tJ 
J 
11 TH 
E PHILIPPINES 
V 
- , HARBIN 
:=i 
r.l 
.. 
:!: 
' 
'+: 
! 
PICKLE LAH 
CANADA 
SIOUX LOOKOIH 
 STATEMENTS OF FIN ANCIAL POSITION 
NORTHWEST ~ AIRLINES, INC. 
ASSETS 
December 31, 
CURRENT ASSETS 
1954 1953 
,::i.sh ... ................................................................................................................. ,  8,26, 77 5 
Accou nt. 1 
T civ::i.ble, k .. allow, n c r , 70,000 195-1 and L 53............. ..... 5,2 19,396 
1faint n, n 'C and I era ting su p1 lies, ::i. t avn , gc cos t... ............................... 99 1,327 
Pr aid ir su r , nc , r n t tax s, etc................... ......... ..................................... :~gr: J -18 
TOT AL CURRENT ASSETS .' lI .869,8,1 
6 
INVESTMENTS AND OTHER ASSETS 
R l~1 t d industr , inv . tmr nt s .1 nd adv:-inccs,, t ost. ...................................... . 216,02 l 
FLIGHT EQUIPMENT a t co~t. ...................................................................... .'11,357,39 1 
( Tncluding fully , rnortized a1noun ts .'. ,0 )1 ,:3 _:) 195-~ 
, 7,9;')9 915 
l 3) 
L " . 11 wan s fo r ckpnc i:1tion :rncl oh~olcs c 1 
H't' ........................................ 2-1,560,976 
." I (),7. 6; 11 8 
, d\Jn s on pu r ha:c rnn l rarls N Ole's .'\ a. n I E..................... .......... ........... 1,7 J2, H 0 
, ' I 8,558,558 
OTHER EQUIPMENT, BUILDINGS, AND LAND, :1 1 rnst ................. .' I1 ,688,67 
(In ludini-, fullv , rnortizt d :.1 111 un ts "'.1.00-1 
,022 - 195-~, 2 9H,"70 - 
1 53 ) 
L : , llow, nc s fo r dep r ci, tion ...................................................................... 6,773,r. 07 
,' 1,91 5, 169 
DEFERRED CHARGES 
T r.1ining .rnd thcr costs in co nn ection "'ith .1ircraft n 'c ts, J ,ss a - 
umul a t dam rtiz, ti n of 37,61 1 
~ 1 1 -1-85 0 8 l9 r.3 .................. ,'' 
th r ................................................................................................................ . 
cc acco m J1a111i11g :\ ofts lo F i11a11cial tale mc11I .. 
$ 1 J 212 100 
4 764 14-1 
1 2-1-9 084 
499,557 
$17,724 882 
24-7,790 
, 37,642,757 
, 1 l ,30c.l-,038 
6,262,152 
5,011 ,886 
$+0,608, l 1 
LIABILITIES AND STOCKHOLDERS' EQUITY 
CURRENT LIABILITIES 
   
V ...... . ................................ .. .......................... . .... . . 
, roll d 'ducti ns, etc .................................. . 
C ................................ . ............................................. . 
1 t aXC' ............................... .. .................... ................ . 
rr t ........................................ .......... ... ........................ . 
Inco1nc t ................................................... ............ .................. . 
December 31, 
1954 1953 
4 938,465 
1 946 800 
969 383 
865,725 
" 22 69 
757,367 
2 575 456 
$ 4 277 826 
2,584, 142 
1,079,832 
811,325 
377,449 
660,785 
urr nt n , , -t rm debt. .................................. ........................... ___ _ 
1 785 850 
3 340,000 
TOTAL CURRENT LIABILITIES 
LONG-TERM DEBT - at 
-1:<i o tc_ I a a l l lo banks, i 'ss am oun ts m a lu rin  within n y ar.. ........ 
STOCKHOLDERS' EQUITY - a t 
umul  enc t ck, 25 1 ar valu ; authorized 600,000 share 
ua : 
-1-.6  uthoriz d sh a res 375, l 2r.-19 --1, 0- 1 
, . ; ,h are's 3 8,1 10 195+, 3 75,075-19 a te B .......... 
omrnon 10 p, r v, lu ; ::iuth riz ' 3,000,000 h  cl and 
ut tan r ' 814". 33 195-l, )_Q,933-19c::3 ............... . 
mm n t ck su b.cripti n fr 3,650 sh are' (i u d J anu, r 1955) ....... . 
C a pi ta l surplus a ft rd ducli n f ":)60 625 in ri r ~ars f r 1 a rt of 
di id nd. paici on 4. ) urnub ti\' ' Prdcr 'n ee tock . ................... .. . . 
E arn d urplu .................. . . 
CONTINGENT LIABILITY for r pur ha - of tr \' 1 on tra  ld- 
$84 048 
COMMITMENTS - r t E 
9 202 750 
8,349 330 
36 500 
2 96L 
t 638 
275 889 
."39,204,996 
ec acco m pall'yinr; ate to Financial tat ments. 
$149 17,209 
955 000 
9 376 875 
8 209 330 
2 860 578 
4 289 919 
$ 0, 08,911 
 T ATEMENTS OF INCOME 
NORTHWEST AIRLINES, INC. 
Year Ended 
December 31, 
1954 1953 
OPERATING REVENUES 
Pa senger ........................................................................................................... . 
United States mail- Note F ............................................................................. . 
Foreign mail. ...................................................................... ................................ . 
Expres , freight, and exce baggage ............................................................... . 
Charter and other transportation ....................... ............................................ . 
Pacific airlift for United States Government. ................................................ . 
Repair and ervice income, rents, etc., net ..................................................... . 
OPERA TING EXPENSES 
Flying and ground operations ......................................................................... . 
~~~ 
tf;na~~: ad:!r:d:J~~: :::::: :: :: :::: :: :::: :: :: :::: :: :: :: :: :::::: :: :: :: ::: : :: :::::::: ::::::::::::::::: 
Traffic, ale , and adverti  ing ......................................................................... . 
Administrative and general (including pay roll taxe , property taxe , 
etc.) ............................................................................................................... . 
Employee ' retirement plan ............................................................................... . 
OTHER DEDUCTIONS (INCOME), NET 
$51,053,599 
6,282,057 
504,334 
5,295,694 
50,406 
409,761 
$63,595,851 
$30,043,761 
1 l j672,122 
5,606,174 
7,383,113 
3,764,202 
415,182 
$58,884,554 
4,711,297 
Intere t on long-term debt... ........................................................................... $ 172,600 
17,137 
81,584) 
Other long-term debt expen e ........................................................................ .. 
Other, net. .......................................... ........................................................ ......... ( 
$ 108,153 
INCOME FROM OPERATIONS BEFORE INCOME TAXES .......... $ 4,603,144 
INCOME TAXES, e. timated federal and other taxe on income from 
op ration ............... .............. .. ............................................................ ............... 2,400,000 
NET INCOME FROM OPERATIONS ..................................................... $ 2,203,144 
INCOME FROM DISPOSALS OF PROPERTY ................................... $ 287,380 
Le applicable income taxe ............................................................................ 75,000 
NET INCOME FROM DISPOSALS OF PROPERTY  ... ............. 212,380 
NET INCOME FOR THE YEAR ................................................................ 2 415,524 
ee accompanying N otes to Financial. Statem ents. 
( 
$48,652,465 
6,869,219 
495,843 
5,373,113 
179,947 
4,184,589 
384,851 
$66,140,027 
$31,801,108 
13,885,447 
5,730,820 
7,324,210 
3,811,411 
444,000 
$62,996,996 
$ 3,143,031 
$ 282,229 
59,651 
3,352) 
$ 338,528 
$ 2,804,503 
1,465,000 
$ 1,339,503 
$ 815,190 
210,000 
$ 605,190 
$ 1,944,693 
 NOTES TO FINANCIAL STATEMENTS 
NORTHWEST AIRLINES, INC. 
December 3t 1954 
Note A-Bank Credit Agreement 
The long-term loan outstanding at D ecember 31 1953, was 
paid during 1954, and the related bank credit agreement ter- 
minated. 
On o\ember 1, 1954, the Company entered into a new Bank 
Credit Agreement under which it may borrow, subject to cer- 
tain conditions, on or before August 31, 1955, for the purpose 
of equipment financing (Note E ) not to exceed $18,000,000. 
At M arch 7, 1955, $6,500,000 had been borrowed under the 
Agreement. Loans made under this Agreement are unsecured 
and bear interest at a rate of 3% per annum. The Company 
has agreed to pa a commitment fee of  of 1 % on the av- 
erage daily unused portion of the commitment. The Agree- 
ment requires repaymen::s aggregating $3,000,000 annually 
beginning in 1955. 
The Company has co enanted that, among other things, 
(a) it will not permit the excess of current assets and ad ances 
on certain flio-ht equipment, over current liabilities ( excluding 
current maturities under the Agreement ) to be less than 
3,000,000 ( ubj ect to reduction in the event and to the extent 
of optional prepayments on amounts due within one year) 
and (b) it will not permit its capital and surplus to be le s 
than $20,000,000. 
ate B-4.6% Cumulati, e Preference Stock 
This Stock Series is entitled upon liquidation (voluntary) or 
redemption to 25.25 per share plus accumulated unpaid 
dividends; is convertible per share into one and one half 
shares of Common Stock to January 1, 1957; and is subject to 
retirement through market or sinking fund provision . 7 015 
of the authorized hare at December 31, 1954, had been per- 
n:ianently retired through market fund purchases and conver- 
sion. 
So Jong as any of this Stock Series is outstanding, the Com- 
pany i required to set aside on or before March 31 in each 
year to and including 195 7 a non-cumulative fund, for the 
purcha e of shares of uch Stock on the market at not exceed- 
ino- $25 per share exclusive of brokerage charges and taxes. On 
or before March 31, 1955, $184.774 will be required to be set 
aide for this purpo e. After 1957, other, and cumulative, 
sinking fund provision become applicable. 
During any period while the Company is in default with 
re pect to payment of dividends on the Cumulative Preference 
Stock, the Compan may not purchase any of such Stock ex- 
cep t pursuant to an offer to all holders thereof and may not 
redeem le s than all of such Stock then outstanding. D ividends 
accruing to February 1, 1955 have been paid. 
ote C-Restrictions on Earned Surplu 
At D ecember 31. 1954 under pro ision of the Bank Credit 
grecment and Cumulative Preference Stock, 5,019,792 of 
earned urplus wa re tricted a to payment of cash dividends 
on capital stock. The . greement prohibits repurchase of the 
Compan ' capital tock. except that 4.6o/c Cumulati e Prefer- 
ence tock may be retired through market fund purcha e 
(:\"ote B ). The term of the Cumulati e Preference Stock al o 
contain r triction relating; to repurchase of Common tock 
which were le Jimi ting a t D ecember 31 1954. 
ate D-Common Stock Reservations and Options 
Of the 2, 165,067 shares of authorized but uni sued Common 
Stock at D ecember 31, 1954: 
(a) 552,165 shares ma be required for coD\er ion of 4.6% 
Cumulative Preference Stock ; 
( b) an aggregate of 37,350 shares ( of which 1 7 .350 shares 
were exercisable at December 31, 1954) , ere subject to 
outstanding options held by two of the Company's officers 
and a fo~mer officer. The option prices approximated, 
or were ~1gh er than, market at the date of grant. D uring 
1954, opt10ns for 17 150 shares (at $14.375 per share) and 
for 500 shares (at $12.125 per share) were exercised by 
the optionees, at which time market price ranged from 
$17.25 to  19.75 per share. Options for 17,850 shares 
(10,000 at $11.25 per share an d 7,850 at $14.375 per 
hare, including 5,000 share which became exercisable 
in 1955 ) were exercised prior to February 25 1955. 
Options for 19 500 shares (at $12.125 per hare), 'includ- 
ing 15,000 shares which will become exercisable during 
1955, 1956, and 195 7, will expire in O ctober, 1959; and 
( c) 30,000 hares were re erved for options which may be 
g:ran ted in the future to officers and employees. 
Tote E--Com.mitments 
t December 31, 1954, the Company had on order four 
Lockheed Super Conste;Jation aircraft and spare parts at an 
approximate cost of $9,400,000 on \, hich advance payments 
of $1762140 had been made. At March 7, 1955, three of 
these aircraft had been delivered and paid for and the re- 
maining aircraft is expected to be delivered in April. 
In addition the Company e:>..l)ansion and replacement pro- 
gram at this time relating to aircraft and spare parts, includ- 
ing purcha e contracts placed in Yiarch, 1955. will require 
expenditures of approximately $18,300.000 prior to 1958. 
R eference is made to :\"ote A with re pect to the Bank Credit 
Ao-reement for initial borrowino- to finan ce the e transactions. 
ate F-Mail Transportation Compensation 
Mail rates for all years through 1953. except 1951, have been 
ettled and made permanent by the Civil Aeronautics Board. 
~o determination for 1951 has been made. 
Mail compen ation from the nited tate Government for 
international routes for the calend ar year 1954 ha been opened 
for redetermination. The ultima e effect of thi i not known 
at thi time. 
M ail compensation for dome tic route for the first three 
months of 1954 ha been settled and made permanent. As 
to the remainder of the calendar yea r 1954. the Civil Aero- 
nautics Board ha issued an order to the Company and all 
other dome tic trunk carriers to ho\\' cau e why proposed 
rate (\ hich reduce the Company' permanent rate from 45 
cent to an estimated yield of 39.12 cent per ton mile) should 
not be made permanent. The Company i accruing income on 
the ba i of the le er of the two rate . 
 STATEMENTS OF SURPLUS 
NORTHWEST AIRLINES, INC. 
Year Ended 
December 31 , 
1954 1953 
CAPITAL SURPLUS l aft r deduction of $560,625 in prior year for part 
of dividend paid on 4.6% Cumulative Preference Stock ) 
Balance at beginning of year ............................................................................ $2 860,5 78 
Add: 
Exce of par Yalue o\er co t of 4.6 Cumulative Preference Stock 
permanently retired through market fund purcha e .......................... 35,892 
Exce of proceed ov r par value of 17 650 hare of Common 
20,415 
tock _old under option agreement , le expen e ( 7,926 ) of 
i __ uance ...................................................................................................... 68,168 
Exce __ of par Yalue of 4.6% Cumulative Preference Stock, upon 
comer ion over par value of Common tock ........................................ 500 
Balance at end of ear...................................................................................... 2,964,638 $2,860,578 
================ 
EARNED SURPLUS 
Balance at beginning of year.. ......................... ................................................. $4,289 919 $2,779,437 
$1,339,503 
605,190 
Add: 
);et income from operation ................... .................................................... . $2,203 144 
212,380 
~ et income from di po al of propert ...................................................... .. 
X et income for the year ....................... ........................... ............................. . 
Deduct di,idend on 4.6% Cumulative Preference Stock for the year 
ended Xovember 1-$1.15 per hare ......................................................... .. 
Balance at end of ear. .......................... .............................................. ............ . 
$2,415,5 24 
$6 705,443 
429,554 
$6.275.889 
ee accompan 
yina Notes to Financial Statements. 
Board of Directors 
7orthwest Airlines, Inc. 
aint Paul Minnesota 
ACCOUNTANTS' REPORT 
$1,944,693 
$4,724,130 
434,211 
$4,289,919 
v\'e ha\e examined the tatement of financial po 1t10n of >IORTHWE T AIRLI:\'E , I c. a of D e- 
cember 31. 1954, and the related statements of in come and urplu for the year then ended. Our 
examination wa made in accorda nce with generally accepted auditing tandard , and accordingly in- 
cluded uch re t of the accountinO' record and uch other auditing procedure a we con idered 
nece ary in the circum tance . I t wa not pos ible to confirm by communication account receivable 
from certain U. . Government department and aO'encie , a to which account we a ti fied our- 
ehe_ by other auditing procedure . 
In our opinion. the accompan ing tatement of financial po ition and tatemen t of income and 
urplu pre ent fairly the financial po ition of NoRTH\ E T AIRLINES, Ixc . at D ecember 31, 1954, 
and the re ult of it operation for the year then ended, in conformity with O'enerally accepted ac- 
ountinO' principle applied on a ba i con i tent with that of the preceding year. 
ain Paul, ~inne ota 
?\farch 7, 1955 
ER ST & ER1 T 
Certified Public Accountant 
 NORTHWEST AIRLINES, I N C . , ~ ~ 
OFFICERS AND DIRECTORS* 
OFFICERS 
CROIL HUNTER, Chairman, Board of Directors 
DONALD W. NYROP, President 
MALCOLM S. MACKAY, Executive Vice President 
FRANK C. JUDD, Vice President- Operations 
LI US C. GLOTZBACH, Vice President-Personnel 
JAMES W. MARI 1ER, Vice President ales 
LA WRE CE B. KI PORTS, Vice President- Orient R eaion 
A. E. FLOAN, Vice President and Secretary 
LEONARD S. HOLSTAD, Comptroller 
WM. J. EIDEN, Treasurer 
ALROY D. PIEPGRAS, Assistant Comptroller 
DONALD H. HARDESTY, Assistant Treasurer 
FRANK J. SCOTT, Assistant Secretary 
DALE MERRICK, Assistant Vice President-Properties 
C. L. STEWART, Assistant Vice President- Plans 
DIRECTORS 
19 
CROIL H T ER - Chairman, Board of Directors, orthwe.st Air:ines, In c. 
5 4 
JAMES H. BI GER- Vice President, Minn eapolis-H oneywell R egulator Co., M :nnea/Jo!is, M i1111. 
MORTO H. FRY- Partner, R iter and Company, ew York City 
ROBERT M. HARDY- President, unshine Mining Co., Yakima, Wash. 
JOSEPH T. JOH SO - President, The Milwaukee Co., Mil waukee, Wis. 
MALCOLM S. MACKAY- Executive Vice President, orthwest Airlines, I nc. 
DO ALD W. YROP- President, orthicest Airlines, I nc. 
ALO ZO PETTEYS--Vice President and Director, Farmers State Bank Brush, Colo. 
C. FRA K REA VIS- Partner, H odaes, R eavis, ,\1 cGrath, Pantaleoni & Downey, ew York City 
ALBERT G. REDPATH- Partner, Auchincloss Parker & R edpath, ew York City 
WILLIAM STER - President, Dakota ational Bank, Fargo, . D. 
ALBERT F. TEGE - President General Public tilities Corporation, ew York City 
L YMA E. WAKEFIELD, JR.- Vice President, First ational Bank of Minneapolis, Minneapolis, Minn. 
ALBERT J. WEATHERHEAD, JR.- President, Th e W eatherhead Company, Cleveland, Ohio 
WHEELOCK WHIT EY- Director and M ember of Executive Committee Truax-Traer Coal Company, Chicago Ill. 
R egistrar THE H E TIO AL B K OF THE CITY OF NEW YORK, . Y. 
Transfer Agent BA KER TR T COMPANY, EW YORK, . Y. 
* A s of March 7, 1955. 
GENERAL OFFICES: 1885 UNIVERSITY AVENUE, ST. PAUL 1, MINNESOTA 
 NORTHWEST