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Midwest Air Group to Cut 1,200 Jobs

July 14, 2008

By Tom Daykin, Milwaukee Journal Sentinel

Jul. 14–Midwest Air Group Inc. said today that it will lay off 1,200 employees — 40% of the company’s work force — because of coming schedule reductions forced by record-high jet fuel prices.

Oak Creek-based Midwest Air, which operates Midwest Airlines and the Midwest Connect regional carrier, is cutting jobs throughout the company’s operations, in all work groups, spokesman Michael Brophy said.

The job cuts, scheduled to occur no later than mid-September, come as no surprise.

In June, the company said it was phasing out a dozen MD-80 jets used for charter service, as well as regular passenger service to leisure destinations and West Coast cities. The MD-80s, which make up roughly one-third of the Midwest Airlines fleet, use a lot more fuel than the carrier’s 25 Boeing 717 jets.

Some of those Boeing jets can be shifted to replace the MD-80s. But the Boeing aircraft don’t have the range of the MD-80s. And that means current nonstop departures from Milwaukee to Pacific Coast cities such as Seattle, San Francisco, Los Angeles and San Diego, Calif., likely would be replaced with routes that stop at the Midwest Airlines hub in Kansas City, Mo.

Midwest Air executives later said in meetings with employees that they were planning to ground five of the Boeing 717s. That would cut the entire fleet by about half. With major service cuts coming in the carrier’s fall schedule, one consultant estimated earlier this month that 1,100 of Midwest Air’s 3,065 employees could be fired.

Today’s announced job cuts come on top of 380 jobs cut this spring when the company hired Utah-based SkyWest Airlines Inc. to handle all Midwest Connect regional carrier flights, a move designed to save money.

Midwest Air is cutting service and taking other steps to restructure the company and avoid Chapter 11 bankruptcy. The company also is seeking steep wage cuts from its union flight crews, but those proposals have run into opposition from the pilots and flight attendants.

Northwest Airlines Corp. (NWA), AirTran Airways (AAI), Delta Air Lines Inc. (DAL) and other airlines have announced major service and job cuts because of high jet fuel prices. But Midwest Air critics say the company’s problems have been worsened by management missteps, which include not replacing the MD-80s with more efficient jets years ago.

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