Delta Air Lines and Northwest Airlines, preparing to merge amid a steep industry downturn, reported a combined first-quarter loss of $10...

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Delta Air Lines and Northwest Airlines, preparing to merge amid a steep industry downturn, reported a combined first-quarter loss of $10.5 billion on Wednesday, most of it an accounting recognition that the two carriers are worth far less than when they emerged from bankruptcy a year ago.

Airline stocks were relatively stable Wednesday afternoon after plunging Tuesday, led by a decline of more than 35 percent at United Airlines. Northwest closed down 5 percent on Wednesday, to $7.10 a share, and Delta fell 3.5 percent, to $6.56 a share.

Across the industry, carriers are reeling from a huge increase in fuel costs — roughly 50 percent above first-quarter prices in 2007 — and preparing for a decline in demand with the economy faltering.

Delta and Northwest plan to merge and hope the combination produces savings and other efficiencies of more than $1 billion by 2012. Other carriers are in merger discussions, too. But for the industry to return to consistent profitability, airlines will need to push through big fare increases, which to date have been resisted by some discount carriers and by customers.

In the meantime, in a replay of the period after the attacks of Sept. 11, 2001, carriers will be reducing their domestic schedules, laying off workers, deferring investments in planes and other equipment and generally hunkering down.

The handful of bankruptcies among smaller carriers this year could grow to include bigger ones if oil remains above $100 a barrel.

As a buffer against the downturn, Delta had $2.6 billion in unrestricted cash and short-term investments and Northwest had $3.2 billion, both as of March 31.

Aside from the giant accounting adjustments, Delta and Northwest posted big operating losses for the quarter, wider than analysts had expected.

Delta, based in Atlanta and the country’s No. 3 airline, posted a $6.4 billion loss for the quarter. The loss included a $6.1 billion charge to reduce good will on its balance sheet — essentially the value of a business over and above its tangible assets.

Emerging from bankruptcy last year, Delta had pegged its good will at $12 billion. But that relied on $70-a-barrel oil and came around the time of a takeover offer by US Airways that valued Delta at more than $10 billion. Since then, airline stocks have plunged and two years of profits have given way to red ink.

A year earlier, Delta lost $130 million.

Northwest, based in Eagan, Minn., posted a $4.1 billion loss for the quarter, compared with a loss of $292 million a year earlier. It wrote down good will by $3.9 billion, and its balance sheet will mirror Delta’s as they prepare to combine.

Northwest managed just a 2.9 percent increase in fares from a year earlier. Its revenue rose about 9 percent, to $3.1 billion.