Northwest flight attendants hold out

Stacey Vanek Smith Jun 14, 2006


MARK AUSTIN THOMAS: A bankruptcy court has given the thumbs-up to deals Northwest Airlines struck with pilots, baggage handlers and ground workers. But there’s still no agreement with one important group of employees. Stacey Vanek-Smith tells us more.

STACEY VANEK-SMITH: The union concessions include layoffs and major wage reductions. All told, they will save Northwest about $550 million.

But the bankrupt carrier is still struggling with its flight attendants, who rejected Northwest’s proposed cuts last week

Aviation analyst Richard Aboulafia says this court approval puts even more pressure on flight attendants to make a deal.

RICHARD ABOULAFIA: You don’t want to be the sole hold-out union standing between an airline and its survival.

The two sides plan to sit down today, but even if they strike a deal, Aboulafia says Northwest is in for a rough ride. High fuel prices have hit the airline especially hard because of its reliance on short flights and its aging, gas-guzzling fleet.

ABOULAFIA: They need to do an awful lot, because not only are they trying to get their operating margins back up, they also need to attract the kind of capital necessary to make an emergence from Chapter 11 bankruptcy.

Northwest has been in bankruptcy since September.

I’m Stacey Vanek-Smith for Marketplace.

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