Northwest Airlines: Coping With a Strike

Pay Cuts and Layoffs Would Reduce the Ranks by Half

Darryl Jenkins , airline analyst and consultant and visiting professor at Embry-Riddle Aeronautical University, will be online Tuesday, Aug. 23, at Noon ET to discuss the Northwest Airlines strike by unionized mechanics, cleaners and custodians and what it means for the nation's struggling airline industry and the consumer.

Read the stories:

Mechanics Face Doubt, Uncertainty On Picket Line (The Washington Post, Aug. 23)

Northwest Employees Get Little Support (The Washington Post, Aug. 23)

A transcript follows.

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Dulles, Va.: Had the mechanics agreed to NW's offer, do you believe NW would be able to avoid filing for Chapter 11 bankruptcy protection? In my opinion they will file before Oct. 17 and would have done so even if the mechanics agreed to the concessions.

Darryl Jenkins: Good question. I don't see the two events related. Northwest Airlines has probably too much cash to file Chapter 11 at this time.

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Washington, D.C.: Is there any evidence that some travelers are avoiding Northwest so as not to hurt union workers?

Darryl Jenkins: Northwest officials tell me that they've had about a two percent decrease in bookings this month, so there's a little effect, but not much.

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Once friendly skies: However the airline industry shakes out, if behooves the unions to stop (10? 15 years already?) squabbling like little kids and support each other before they dwindle like the last snowflake in April. Here they have their schisms garnering publicity when they have a massive PR deficit with the American public. Most people are hands-out to accept carryover union-won gains in their workplace, but for the workers on strike ... ehh, they don't deserve any support. I work hard and am entitled to more but nobody else is. Divided we fall. Like dominoes. thank you.

Darryl Jenkins: Both unions and management need to grow up and quit acting like kids. I'm personally ashamed of how all of these groups act and don't recommend them as role models.

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Washington, D.C.: I purchased tickets for a NWA flight to Italy in November. How would a bankruptcy filing by NWA affect those tickets?

Darryl Jenkins: The bankruptcy filing will not affect the tickets whatsoever.

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Darryl Jenkins: You do need to check to make sure the flight is at the same time. Sometimes they change schedules when they go into bankruptcy, so this is something you need to watch.

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Next week: What is actually happening with delays and cancellations? We are scheduled to fly on NW to NW Canada next week and I am checking my route online and while there are no cancellations, sometimes there are quite long delays (3-4 hours) that kill connections. That kind of contradicts the official word from the airline. Are delays going to snowball during next week?

Darryl Jenkins: I think as we go further into the strike that delays will lessen.

Before the mechanics went out on strike they let a lot of work pile up. As we go forward in time that backlog will be caught up. But to be prudent, travelers should check to make sure the schedule is still the same next week. So you need to keep looking to make sure the flight is still there.

There will be some cancellations and delays, there's no doubt about that.

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Henderson, Nev.: It has been a pattern of unions bankrupting companies all across the United States, from steal, coal, manufacturing, airlines, and (hopefully not) auto.

Why should employees be able to dictate what they make to their employers? The fact that Northwest found employees to take their place for less pay indicates, by definition, that they were overpaid.

Our labor laws need to be changed so that employers can more easily fire workers who strike or who demand certain wages.

Your comments on this appreciated.

Darryl Jenkins: I believe in collective bargaining and that involves compromises on both parties' sides and I blame management as much as I blame anyone on the problems in the airline industry. Managers need to manage. We can't blame everyone else for our problems.

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Washington, D.C.: Mr. Jenkins: I had the misfortune to fly NWA in July, and despite the conventional wisdom that all airlines are the same, NWA is noticeably worse than the others (hence its well-deserved nickname North worst). The flight attendants didn't even collect the service items! And there were stupid delays (i.e., delays that were predictable but that weren't predicted). Could the strike actually improve the service on NWA?

Darryl Jenkins: God bless you. I guess the most important thing in flying in the summer is a good sense of humor. I'm old enough to know not to fly during the summer months and I don't.

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Ashburn, Va.: It seems like a given that FlyI will go out of business this fall or winter. With Northwest's maintenance heavy and gas guzzling DC-9s, could they perhaps hire FlyI as a regional carrier to replace some of their DC-9s?

Darryl Jenkins: DC-9's are gas guzzlers and I think Northwest has a plan to go to a younger fleet. But you are correct, the DC-9 is a gas guzzler.

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Washington, D.C.: What exactly are the strikers' demands? How much are they getting paid and how much is the airline asking them to reduce their pay/benefits? This is almost always missing from the news stories I read!

Darryl Jenkins: I think the average mechanic makes about $60,000 a year and they were asked to take a quarter cut and to reduce the workforce by half. The union came back with at 16 percent reduction in wage and fewer jobs eliminated.

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Alexandria, Va.: Yesterday I flew domestically for the first time in several months. I was surprised to find out that a meal costs $5 for a box lunch. When did this started to occur?

Darryl Jenkins: It's been in place most of the year.

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Falls Church, Va.: Do you think that some of the rhetoric that AMFA is using unnecessarily frightens the public (i.e., outsourcing maintenance puts America at risk)? Or do you think those are legitimate concerns?

Darryl Jenkins: It is certainly amongst union workers one of the biggest issues right now. And it does put Americana workers at risk.

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Helena, Mont.: In this morning's Post is an article that states that if the mechanics' strike is unsuccessful it could ripple through the airline industry. Why? The same article portrays the mechanics' union as something of a renegade, having little support from other unions. Wouldn't those other unions unite if management tried to go after them?

Darryl Jenkins: Good question. AMFA is not an AFL-CIO union and get most of their membership by raiding the AFL-CIO unions, so there's a lot of bad blood between AMFA and all of the other unions out there.

Why this may go throughout the industry is that if Northwest Airlines is able to break the strike then other airlines may try it as well. Right now, because of layoffs since 9/11, there is surplus of airline employees in the market.

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Reno, Nev.: Buy or sell? If buy, what milestones should cause sell?

Darryl Jenkins: I don't advise on stock purchases.

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Minneapolis, Minn.: It seems to me that the executives of NWA over the years have been walking away with millions, while at the same time demanding concessions from the employees. Is this impression correct, and if so, to what extent does the executive ravaging of the company contribute to its current financial problems?

Darryl Jenkins: You are correct. At the same time, the amount taken out is not sufficient to cause their financial distress but it's a very bad practice and I'm opposed to it.

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Seattle, Wash.: Don't you think the real problem is the airline business model? Hubs, airlines controlling most if not all the gates at an airport. That may have worked 20 years ago but not today. Most of the profitable airlines with happy employees have thrown out the old model. Until the legacy carriers change the way they do business they will continue to lose money and workers will continue to get the raw end of the deal.

Darryl Jenkins: I'm not opposed to the hub and spoke model; however, there are ways that it could be made much more efficient in terms of scheduling and crew resources and I hope these changes are made. However, there are hub and spoke airlines like Air Tran and we see Southwest increasing the number of connections they make. Everybody's a network. It's just how you operate your network.

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Columbia, Md.: Mr. Jenkins, Thanks for taking my question. I and probably many others have an upcoming flight on Northwest. My flight (from BWI to Minneapolis, then on to Hancock, MI via Mesaba) departs on Sept 1 and returns on Sept 10. Should I be booking a backup flight on another airline? Thanks for any suggestions you may have.

Darryl Jenkins: No, not at all. I think most of the kinks will be worked out by Sept. 1. There's always a chance of delays in August or September but I wouldn't book another flight.

Enjoy Michigan, my home state.

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Transplanted Detroiter: Darryl, thanks for being so even-handed when discussing management-labor issues. People have to be reminded that the benefits we all take for granted would not be there without the unions. (I also agree with you that both sides need to grow up and think about the common good.)

I fly from DC to Detroit quite frequently to visit my family, and usually fly Northwest. But I have to say that lately I've been booking on Spirit more and more. Fewer flights, but so far fewer delays.

Thanks!;

Darryl Jenkins: As one Detroiter to another, enjoy flying on Spirit. It's a perfectly good airline.

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Leesburg, Va.: As a 'supporter' of collective bargaining, how do you respond to industry claims, be it auto, aviation or others, that health benefits and pensions are crippling balance sheets? Unions have squeezed, cajoled and extorted concessions from their parent companies for years. When times are good, they want more, and when times are rough, getting concessions is like pulling teeth. Much like other businesses, the aviation industry is going through tremendous change. But the unions don't want to change in order to stay employed. With all the benefits gained by unions, is it finally time to pay the piper?

Darryl Jenkins: I don't agree with your premise. Airline pilots and many others have made very big concessions. These things are never pleasant. I just don't want to see one side ruling the other. You have strong unions and you have strong companies. What we haven't learned is that neither of the sides have learned to live with one another. I blame management just as much as I blame labor for what's going on. There's a lot of blame to go around.

The excesses are on both sides. It's just incredible. I don't think there's a peer party out there right now where one side's trying to save it and the other side's trying to ruin it.

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Minneapolis, Minn.: Almost everyone I know is avoiding booking on NWA for the next couple months -- even elite flyers (like myself). Not because we feel solidarity for strikers (most elite flyers tend to be management-type folks, I'd guess) but because they don't want to take chances on getting where they want to go. NWA is having a great fare sale right now but if you're traveling on short notice (important meeting, weekend wedding) or have special needs (unaccompanied minors, traveling with babies, disabled), it's worth it to pay an extra $50 or $100 to know that your flight won't be delayed 4 hours (like mine was this weekend).

Darryl Jenkins: Thank you for your comments.

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Ashburn, Va.: The six figure salaries of management need to be addressed as much as the salaries of the everyday worker; union and non-union. Throughout all of the recent request for concessions from the major airlines, it seems to me that they are asking the littlest of them all the take the largest hits.

They are asking for a nearly 50% reduction in workforce and a 25 percent reduction in pay. I am aware that the pilots gave up 15%, but did they lose any pilots? Can the maintenance workload handle a 50% workforce reduction? If not, the airline will end up paying out OT for all the extra hours worked by those who are still around. How does that save money?

I think there is a huge disconnect in the logic of 'Corporate America'.

Darryl Jenkins: I agree that corporate people make too much money.

On the specific maintenance question for Northwest, most of that maintenance will be out-sourced. The out-sourced can do it on a timely basis and it will be a lot less expensive -- there's no doubt about that at all. So the reduction in the work numbers is accommodated by sending the heavy maintenance out to other companies that charge less. What they're planning is reasonable.

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Charlotte, N.C.: Airline deregulation has been a disaster! Managers, shareholders, unions, employees, creditors and even the government has lost. The public sees a continuing decline in service. Its time for the government to re-regulate the industry or set some joint agreement within the industry to end this nightmare!

Darryl Jenkins: I don't know what re-regulation is going to accomplish other than raising fares.

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D.C. 20011: I bought tickets on NW quite a while back. I just got back home yesterday.

In order to do so, I had to cross a picket line. I cried. I have never crossed a picket line before, but there I was, far from home with no other way to get home.

I have sent a letter to Northwest telling them that I will not fly with them again until this is settled. But I still feel horrible about having crossed a picket line. I wish I could have found an option.

Darryl Jenkins: Thank you for your comment.

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Darryl Jenkins: I consider this right now an incredible personal tragedy. I know people on both sides and this is just not a happy moment in my life.

Thanks for the questions. I enjoyed it.

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