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Northwest To Set Up New Regional SubsidiaryJanuary 20, 2006 By: Susan Young Travel Agent
Northwest Airlines' unions are finding it tough slugging in contract negotiations with the bankrupt airline, not just on pay issues. The airline has told employees in a newsletter that it hopes to launch a new regional airline subsidiary next year with a fleet of 70- to 100-seat aircraft. The operation, called by a tentative, working name of NewCo., could include as many as 105 aircraft by 2010, and would fly under its own FAA operating certificate. Northwest president and chief executive Doug Steenland said the jets are the perfect size for 20 percent of Northwest markets, which include more small cities than any other carrier. Northwest said other major airlines use separate companies to fly these smaller jets, and it is impractical cost-wise for Northwest to do so, given its current pilot contract. Northwest is apparently promising to staff NewCo with its own furloughed pilots. Changes for flight attendants are particularly onerous to the union that represents them, as Northwest wants to use nonunion attendants for 75 percent of all transPacific and transAtlantic flights, and on all domestic flights on planes with 100 or fewer seats. The Professional Flight Attendants Association has said that amounts to about 500 flight attendants of the 8,950 Northwest employs. Northwest also apparently wants to set up a subsidiary for baggage handlers outside of its hubs, and use outside customer service agents at most of those airports; both are represented by IAM. Northwest has said current union rules require it to pay for a full shift even though it flies only once in the morning and once in the evening at some smaller airports. In bankruptcy filings Northwest has stated that shifting work away from the IAM could save $56 million a year. IAM has said the proposal could cost the jobs of 5,000 of its 14,600 Northwest workers.