With a strike by thousands of mechanics in its third day, Northwest Airlines on Monday faced its biggest test yet in its bid to keep operating, but the stock rallied as investors bet the carrier had won.

Northwest kept flying over the weekend without any major disruptions as it called in 1,500 replacement workers in a bid to weather the first US airline strike since 2001, but Monday would be its busiest flying day yet.

Informal surveys showed Northwest's on-time performance over the weekend at between 50 percent and 58 percent, significantly worse than its June average of 72.5 percent.

The airline, with hubs at Minnesota and Detroit, was completing nearly all flights, albeit with a reduced schedule and capacity off 17 percent from the summer peak.

Members of the Aircraft Mechanics Fraternal Association picketed major airports again Monday, and a union representative said the walkout by 4,400 mechanics and maintenance workers was taking a toll.

"Our evidence is that Northwest is having a great deal of trouble keeping their operation running," said Steve MacFarlane, AMFA's assistant national director, adding that the union would not return to the bargaining table unless Northwest substantially sweetened its recent proposals.

Northwest shares jumped 5 percent, as analysts said the carrier had survived the strike well and boosted its chance of winning the remainder of USD$1.1 billion in wage and benefit concessions the airline said it needs to stay competitive.

"Northwest's extensive contingency planning appears to be paying off," Morgan Stanley analyst Douglas Runte said in a research note. "Increased flight schedules on Monday are a bigger challenge for the company, but should be manageable, we believe."

The airline said on its web site that more than 1,400 flights were scheduled for Monday, up from 1,300 on Sunday. Planes were flying 80.9 percent full on Sunday in a sign passengers were sticking with Northwest, the airline said.

However, traffic at Detroit Metro Airport looked very thin for an unusually slow Monday morning, but of 115 outgoing Northwest flights, only 3 cancellations were listed, with 25 delayed flights.

Northwest, like other traditional US airlines, has been struggling with surging energy costs as fuel prices hit records, as well as burgeoning labor and pension expenses. The airline has warned it will face bankruptcy if it can't better contain those costs.

Analysts have said Northwest's operating expenses are the highest among the so-called legacy carriers.

The airline is seeking USD$176 million in annual wage and benefit concessions from AMFA members, part of which would be accomplished by firing about 50 percent of its members.

"We are clearly prepared and ready to last months if that's what it takes," said the union's MacFarlane. "We know that it's a very destructive thing, just like war is a very destructive thing, but sometimes you have to fight."