EDITORIAL: Delta’s Pilots Putting More Than Airline at Risk
By The Macon Telegraph, Ga.
Apr. 10–There are storm clouds hanging over Atlanta’s Hartsfield-Jackson International Airport. The forecast, if correct, could bring thundershowers, even hail, to the rest of the state. On April 4, Delta Airlines’ pilots gave its union the authority to set a strike date. It could come as soon as April 18. At issue is a request by Delta’s management to void the pilots’ contract and cut $325 million from their pay and benefits. That request comes after pilots gave up $1 billion in concessions in 2004, including a 32.5 percent wage cut. The airlines’ 5,930 pilots have said they would give up an additional $140 million, but Delta has said $305 million is the least it can accept.
A neutral arbitration panel is supposed to render a decision on the cuts by April 15. If a strike does occur, the reverberations will be felt region-wide and not just by the flying public. Initially, Delta would probably seek a restraining order to get pilots back to work. However, by the time one is granted, the disruption would have already taken its toll. Passengers and potential passengers would look to other airlines and avoid the uncertainty of the Delta situation.
But that’s just the beginning if negotiations go south. Delta is a major carrier with about 1,000 daily flights in and out of Hartsfield-Jackson. Having that type of service is one of the reasons the state’s economic growth has been robust. According to the Georgia Department of Economic Development, “Businesses can reach 80 percent of the U.S. market within two hours flight time, and any major North American city in four hours flight time. International flights reach 45 cities and 30 countries, making the world’s business centers easily accessible.” On the tourism side, GDED said, “Eight million visitors traveled to and through Georgia in 2003.” A big part of business and tourism is Delta Airlines.
Delta and other airlines are experiencing a transition in business models not dissimilar to the auto industry. Contracts with unions have given away the store. At least that’s what management believes. Both the U.S. airline and auto industries have been slow to change. Old-line airlines like Delta have been forced to lower prices because of discount airlines. Those airlines can make money because they are not saddled with the same personnel costs. The U.S. auto industry hasn’t been able to keep up with its foreign competition and has lost market share. Contracts with its workers have the industry bleeding red ink.
While two of the big three automakers have been teetering on the edge of bankruptcy, none have fallen, yet. Not so for airlines. United, Northwest and U.S. Air have sought bankruptcy relief. Delta hopes to emerge from its financial woes a leaner airline. But if the pilots do strike, the airline might not emerge at all.
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Copyright (c) 2006, The Macon Telegraph, Ga.
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