NWA and DAL back on track
#21
NWA320, your response is just so typical of what I see in NWA.
Pay not a big deal... pay goes away
Bonus not a big deal... bonus goes away
Job protections not worth too much... job protections go away
...and just like that 2 Billion vanish.
NWA pilots want arbitration...
... and NWA management comes to the table with a cram down that raises concerns about fragmentation policies.
Why does everything just have to be bad with you guys?
Pay not a big deal... pay goes away
Bonus not a big deal... bonus goes away
Job protections not worth too much... job protections go away
...and just like that 2 Billion vanish.
NWA pilots want arbitration...
... and NWA management comes to the table with a cram down that raises concerns about fragmentation policies.
Why does everything just have to be bad with you guys?
When we merge, it's going to go to arbitration. In arbitration they will award something similar to NWAs mixed SLI offer. It is then that we will see who was stubborn and who lost the goodies on the table...
#27
Can't abide NAI
Joined APC: Jun 2007
Position: Douglas Aerospace post production Flight Test & Work Around Engineering bulletin dissembler
Posts: 11,989
#29
Can't abide NAI
Joined APC: Jun 2007
Position: Douglas Aerospace post production Flight Test & Work Around Engineering bulletin dissembler
Posts: 11,989
http://www.fool.com/investing/genera...c-victory.aspx
By Tim Beyers April 1, 2008
Over the weekend, The Wall Street Journal reported that executives at Northwest Airlines (NYSE: NWA) are still pushing for a merger with peer Delta (NYSE: DAL), even if it means their pilots were to lose their seniority -- and thereby, a number of other promised benefits. Talk about a dumb idea.
Don't get me wrong; I'm a capitalist, and unabashedly so. But the Journal report, if true, reeks of desperation. It's almost as if Northwest management so fears another journey into Chapter 11 bankruptcy that it'll destroy the airline to, uh, keep from destroying the airline.
Destroy the airlines?
Unions -- love 'em or loathe 'em -- have broad authority when it comes to the airline business. Only carriers that deal fairly with their people have a prayer of producing long-term profit.
Delta and Northwest know this. But the Journal report suggests that upon the completion of a merger, Northwest's 5,000 pilots would mostly fall behind their new peers in terms of seniority, benefits, and worst of all, pay. (The average Delta pilot is paid more than the average Northwest pilot, according to the Journal.)
At issue is what's called a "seniority list," whereby pilots are ranked according to their time with the company. Every major carrier has one. Seniority plays a key role in determining assignments, time off, and other benefits.
Pilots at Delta and Northwest have been unable to agree on terms for combining seniority lists. Apparently, Delta's fliers fear that they'll forfeit much of what they've earned at the bargaining table, as well as opportunities for career advancement. No doubt that's true. But what's the alternative?
I'm not entirely sure whether the fears of Delta's pilots are justified. But certainly, Northwest's fliers have something to fear. History has been unkind to acquired carriers. TWA, for example. AMR (NYSE: AMR) spent $500 million for the carrier in 2001. Employees of beleaguered Trans World lost much of their seniority, and the benefits that came with it.
The ensuing fight got so ugly that the Senate held a hearing on the matter in 2003 -- the same year that American narrowly avoided bankruptcy. Yet little has changed since. A simple Web search will direct you to more than a few sites where former TWA employees vent their frustration as they pledge to help each other.
To be fair, neither Delta nor Northwest is under any obligation to get its pilots to agree to a combined seniority list. But without one, the chances of this deal resembling the American-TWA debacle increase dramatically.
A little more history
Let's not forget that Northwest already has a reputation for union-busting. A 2005 mechanics' strike mostly failed after management called in line-crossers and contractors to replace its 4,000 grease monkeys. A 2006 tete-a-tete with pilots nearly ended in disaster.
Will Northwest employees tolerate still more cuts? I doubt it. At some point, enough will very likely be enough.
That's the lesson of history. Unions rarely take to scorched-earth policies, but the territorial nature of the airline business has led to fistfights at the new US Airways (NYSE: LCC) and finger-pointing at United Airlines parent UAL (Nasdaq: UAUA).
How about we prevent such a mess this time, Northwest? Take a lesson from master investor Philip Fisher instead, who asks in his famous 15 points whether a prospective investment has "outstanding labor and personnel relations."
He wrote that for a reason, sirs. Happy employees make for a healthy business. There's still time for you to have both -- but only if you abandon your merge-at-all-costs strategy. That way a Pyrrhic, and perhaps fatal, victory lies.
By Tim Beyers April 1, 2008
Over the weekend, The Wall Street Journal reported that executives at Northwest Airlines (NYSE: NWA) are still pushing for a merger with peer Delta (NYSE: DAL), even if it means their pilots were to lose their seniority -- and thereby, a number of other promised benefits. Talk about a dumb idea.
Don't get me wrong; I'm a capitalist, and unabashedly so. But the Journal report, if true, reeks of desperation. It's almost as if Northwest management so fears another journey into Chapter 11 bankruptcy that it'll destroy the airline to, uh, keep from destroying the airline.
Destroy the airlines?
Unions -- love 'em or loathe 'em -- have broad authority when it comes to the airline business. Only carriers that deal fairly with their people have a prayer of producing long-term profit.
Delta and Northwest know this. But the Journal report suggests that upon the completion of a merger, Northwest's 5,000 pilots would mostly fall behind their new peers in terms of seniority, benefits, and worst of all, pay. (The average Delta pilot is paid more than the average Northwest pilot, according to the Journal.)
At issue is what's called a "seniority list," whereby pilots are ranked according to their time with the company. Every major carrier has one. Seniority plays a key role in determining assignments, time off, and other benefits.
Pilots at Delta and Northwest have been unable to agree on terms for combining seniority lists. Apparently, Delta's fliers fear that they'll forfeit much of what they've earned at the bargaining table, as well as opportunities for career advancement. No doubt that's true. But what's the alternative?
I'm not entirely sure whether the fears of Delta's pilots are justified. But certainly, Northwest's fliers have something to fear. History has been unkind to acquired carriers. TWA, for example. AMR (NYSE: AMR) spent $500 million for the carrier in 2001. Employees of beleaguered Trans World lost much of their seniority, and the benefits that came with it.
The ensuing fight got so ugly that the Senate held a hearing on the matter in 2003 -- the same year that American narrowly avoided bankruptcy. Yet little has changed since. A simple Web search will direct you to more than a few sites where former TWA employees vent their frustration as they pledge to help each other.
To be fair, neither Delta nor Northwest is under any obligation to get its pilots to agree to a combined seniority list. But without one, the chances of this deal resembling the American-TWA debacle increase dramatically.
A little more history
Let's not forget that Northwest already has a reputation for union-busting. A 2005 mechanics' strike mostly failed after management called in line-crossers and contractors to replace its 4,000 grease monkeys. A 2006 tete-a-tete with pilots nearly ended in disaster.
Will Northwest employees tolerate still more cuts? I doubt it. At some point, enough will very likely be enough.
That's the lesson of history. Unions rarely take to scorched-earth policies, but the territorial nature of the airline business has led to fistfights at the new US Airways (NYSE: LCC) and finger-pointing at United Airlines parent UAL (Nasdaq: UAUA).
How about we prevent such a mess this time, Northwest? Take a lesson from master investor Philip Fisher instead, who asks in his famous 15 points whether a prospective investment has "outstanding labor and personnel relations."
He wrote that for a reason, sirs. Happy employees make for a healthy business. There's still time for you to have both -- but only if you abandon your merge-at-all-costs strategy. That way a Pyrrhic, and perhaps fatal, victory lies.
#30
Line Holder
Joined APC: May 2007
Posts: 62
CAP, you do not understand where the "goodies" came from? How about Lee Moak stating way before Prater and NWA jumped on board that any merger would include the pilots and provide equity and compensation for cooperation. The outline of this new way of doing mergers was devised by DALPA. That is a fact, so in essence, this deal would have already been crammed down our collective throats without any input if DALPA had not been out in front of this issue before it arose.
Do you really believe that if CAL, UAL or AA came and asked NWA to do a deal that there would have been "goodies" for NWA pilots? VERY NAIVE!!!!!!
Why do you suppose the deal is/was considered dead by DAL? It is because DALPA does not see the value of destroying our airline over a SLI that is detrimental to the pilots at DAL. RA agreed and walked away. Steenland came back along with NWALPA asking that the deal be further considered. Knowing how NWA views its employees, I doubt it will be as good as it would have been.
This new deal is going to be tweaked, I doubt it will be the DAL side that is in for a rude awakening. DAL is on the leading edge of the Open Skies movement and will not destroy the company because some ****ed off employees at NWA who work under different colored books want a windfall deal.
And you wonder why DAL pilots are against this merger? DAL has had its share of mergers too. We still have one contract, one book and a workforce that at least enjoys the people they work with.
Do you really believe that if CAL, UAL or AA came and asked NWA to do a deal that there would have been "goodies" for NWA pilots? VERY NAIVE!!!!!!
Why do you suppose the deal is/was considered dead by DAL? It is because DALPA does not see the value of destroying our airline over a SLI that is detrimental to the pilots at DAL. RA agreed and walked away. Steenland came back along with NWALPA asking that the deal be further considered. Knowing how NWA views its employees, I doubt it will be as good as it would have been.
This new deal is going to be tweaked, I doubt it will be the DAL side that is in for a rude awakening. DAL is on the leading edge of the Open Skies movement and will not destroy the company because some ****ed off employees at NWA who work under different colored books want a windfall deal.
And you wonder why DAL pilots are against this merger? DAL has had its share of mergers too. We still have one contract, one book and a workforce that at least enjoys the people they work with.
Thread
Thread Starter
Forum
Replies
Last Post