LuvJockey

New Midwest Airlines owner to cut 100 local jobs

By Tom Daykin of the Journal Sentinel

Posted: Aug. 14, 2009 2:38 p.m.

Midwest Airlines Inc. will cut about 100 jobs from its Milwaukee-area workforce, a reduction of about 9%, company chief executive officer Bryan Bedford said Friday.

Most of the job cuts from Midwest's Oak Creek headquarters and operations at Milwaukee's Mitchell International Airport are back-office and administrative positions that duplicate jobs at Indianapolis-based Republic Airways Holdings Inc., which completed its $31 million purchase of Midwest on July 31.

"We've got to make the airline highly efficient," Bedford said.

The jobs that remain intact include mechanics at Midwest's maintenance hanger, gate agents and ground crews at Mitchell International, and customer service representatives at the headquarters and reservations center, 6744 S. Howell Ave.

Many of those employees are needed because Republic's main business is operating commuter flights for Delta Air Lines Inc., United Airlines and other major carriers. As a result, Republic doesn't have a customer service department, marketing department and other operations used by the carriers that hire Republic.

The cuts of about 100 positions will leave Midwest with around 1,000 local employees, Bedford said. Midwest has around 1,600 employees, with 1,100 employees locally, he said. Employees who are laid off will receive severance packages, he said.

Around 160 employees are receiving layoff notices, Bedford said.

But some of those employees, including mechanics, are being offered positions with Republic Airlines, one of the airlines owned by the parent corporation, Republic Airways Holdings, he said. He said those employees were notified to make sure the company complies with the law requiring 60-day notices for layoffs.

Still up in the air is the fate of over 250 Midwest pilots and flight attendants who are represented by the Air Line Pilots Association and Association of Flight Attendants.

Those unions are negotiating with the International Brotherhood of Teamsters, which represents union flight crews at Republic, over combining seniority lists of union flights crews from Republic and Midwest.

Meanwhile, Republic plans to add more flights to Midwest's schedule, which should create more jobs, Bedford said. Republic has already restored Midwest flights from Milwaukee to Louisville, Ky., and Los Angeles.

There also will be a change in aircraft, with Midwest dropping its nine 99-seat Boeing 717 jets, to be replaced by nine 99-seat Embraer 190 jets. Under Republic's ownership, Midwest's fleet will include a dozen 76-seat Embraer 170 aircraft, and 12 regional jets with 37 to 50 seats.

Also, Republic on Thursday emerged as the winning bidder in a bankruptcy auction for Denver-based Frontier Airlines. Bedford said some of the 138-seat Airbus A319 jets used by Republic will likely be shifted into service for Midwest flights to West Coast destinations.

RepublicofTexas

How nice, it all works so nicely.

This industry stinks.

F9er

I wouldn't get to worked up about this. There is current language (that must be voted on) that will prevent this and or will result in a recall of current F9 pilots

whodee

It will be done by a codeshare. By January there will be enough flying out of MKE with the Airbus that they will make it a base. More of the Midwest flying being outsourced and replaced. Where do the Midwest pilots fit in?

youngairliner

Well, be careful watch you wish for. Within a day or two, RAH is shifting flying out west to a cheaper group of pilots. No sort of labor agreement in place, and no pay agreements in place either. Good luck. We are all big losers in this because the fight for DEN just got more intense, which means lower profits for all.

Angel

it is just SAD!!!!!

RepublicofTexas

Question to me is where does DAL play in to all of this. Something stinks in IND!

slowplay

DAL doesn't.

TPG owned and had a controlling 53% of Midwest. NWA, which became a Delta subsidiary with the merger, owned 47% of Midwest, but was restricted from operational contraol. That 47% stake was written off prior to the sale to RAH. The terms of the TPG deal required TPG to be made whole prior to any return for NWA. TPG sold 100% of the equity to RAH. As of July 31, NWA, now DAL owns none of Midwest.

Midwest places their code on Delta flights. Delta code is not placed on Midwest flights.

While the situation stinks for Midwest, it has and had nothing to do with Delta.

RepublicofTexas

They wrote the investment off, does that mean they gave up the control too?

Does that mean that DAL would/ could buy parts and or all of RJET to gain the DEN and MKE markets?

3XLoser

The press releases don't always match the SEC filings. As I understand it TPG is retaining a 7.8% (?) investment and a seat on the board? It's all so incestuous that there's no way to know what might still happen, and who still has their hands in the cookie jar.