But the deal's not done yet.

If it goes through, the new airline will be called Delta, and Delta's headquarters would remain in Atlanta. Neither airline would close any hubs.

But closing their headquarters in Minneapolis could be a problem for Northwest because of penalties tied to state incentives and favorable airport lease terms in exchange for keeping their headquarters there. And there are several labor issues yet to be worked out. Then it will need the federal government's blessing. And shareholders will have to approve it.

Lots of hurdles, but the companies say they expect to close the deal by the end of the year -- "before the end of the merger-friendly Bush administration."

Analysts say the consolidation will be good for the industry if the new airline, which would be the world's largest, can reduce underutilized capacity to avoid deep discounting price wars that result from too much inventory for not enough passengers.