Carrier Wants To Transfer Pilots To New Regional Operation
The head of the
Northwest pilots union is standing firm on his declaration the
union will not accept any contract with the airline that would
shift as many as 1,500 pilot jobs to a new regional subsidiary.
"It's a corporate shell game of transferring assets and
franchise value to a new company," Mark McClain, chairman of the
Northwest pilots union, said last week to the Minneapolis
Star-Tribune.
Northwest management is hoping to create a new regional
subsidiary (referred to as NewCo) flying 76- to 100-seat RJs. Both
new pilots and previously furloughed Northwest employees would be
called upon to fly the aircraft, according to the carrier.
According to McClain, however, the deal isn't as altruistic as
Northwest would have everyone believe -- stating the carrier
instead wishes to use the subsidiary to drop as many as 30 percent
of the 5,100 pilots now on the Northwest payroll.
"We see this as another mechanism for the Gary Wilsons of the
world to make a trainload of money on our backs," McClain said.
Wilson is Northwest's board chairman.
Northwest asserts the move is merely another way to make the
airline, currently involved in Chapter 11 bankruptcy proceedings,
more competitive.
"Northwest cannot simply bring 70-seat regional aircraft into
its mainline system because that does not make economic sense -- a
fact borne out by the fact that no legacy airline operates 70-seat
regional jets within their mainline fleets," the airline said,
adding a new airline could potentially "provide jobs for hundreds
of furloughed NWA pilots."
The carrier hopes to add the new subsidiary to facilitate
replacement of the carrier's aging DC-9s with advanced RJs, such as
Embraers, that are better suited to Northwest's route structure --
and are more economical than the fuel-guzzling, 30-year-old
planes.
Northwest has stated it will take three things for the carrier
to emerge from bankruptcy -- a "competitive cost structure,"
eliminating excess debt and "resizing the fleet." The carrier noted
the bankruptcy court has already approved the carrier's plan to buy
more Airbus A330s (above) to strengthen its international
fleet.
That puts the Northwest pilot's union -- part of the Air Line
Pilots Association, the same organization that recently agreed to
an interim contract with similarly-troubled Delta -- in a powerful
position.
"It's make-or-break time at Northwest Airlines," McClain said,
adding that for Northwest to survive, management must be willing to
negotiate contracts that recognize "the value of the employees
doing the work."
If the carrier doesn't agree, McClain said pilots may once again
be forced to strike -- a move that cost the airline $1 billion in
1998.
"The management team,
led by John Dasburg, didn't listen to what we were telling them. We
told them all along what our demands were and what would happen if
they were not met," McClain said. "They paid the price."
In a memo to Northwest's pilots, McClain stated "NWA pilots will
not accept the NewCo [subsidiary] proposal. There will be no deal
on management's current terms."
If Northwest's executives don't back off, McClain added,
Northwest's Chapter 11 bankruptcy reorganization could become a
Chapter 7 liquidation.