Mesaba Makes a Deal with Mechanics

Mesaba Aviation Inc. reached a tentative agreement with its mechanics on Tuesday, the last of its workers who had resisted pay cuts.

Pilots and flight attendants at the feeder for Northwest Airlines Corp. made their own deals over the weekend. All three tentative agreements must be approved by workers to become final.

Mesaba spokeswoman Elizabeth Costello said they reached the deal with mechanics at about 2 a.m. Tuesday. Several other rounds of talks had lasted all night.

Mesaba said it needed the labor deals so it could compete for regional flying for Northwest. And it needed the deals in the short run so it could get access to a $24 million debtor-in-possession loan.

Mesaba, a unit of MAIR Holdings Inc., filed for bankruptcy protection last fall, about a month after Northwest, its only customer. A bankruptcy judge gave Mesaba permission to impose cuts that would slice its labor expenses by 17.5 percent.

When unions said that would prompt a strike, the same judge blocked them from walking out. The deals followed soon after that. In any case, Mesaba negotiated instead of imposing the pay cuts. The terms it reached with the three unions have not been disclosed.

'This has been a complicated and difficult process but working together we have been able to reach a solution that addresses the company's needs and the mechanics' interests,' said Mesaba President and Chief Operating Officer John Spanjers. He said the three agreements are 'another vital step toward Mesaba's successful restructuring.'

Union attorney Nick Granath said it will be up to the members of the Aircraft Mechanics Fraternal Association to decide whether they have a contract.

'To be clear, this is not an agreement we prefer and we are not telling people to vote either for or against it,' he said by e-mail. 'This offers the best chance for Mesaba's survival, however, there is really little to celebrate under these dire circumstances not of our making.'

Mesaba flies to 88 cities, funneling passengers into Northwest hubs in Detroit, Minneapolis and Memphis. Its fleet once numbered about 100 planes, including regional jets, but Northwest has reduced that to 49 prop-driven Saab aircraft.

Costello said Northwest made it clear that even the Saab flying could be taken away if Mesaba didn't reduce its expenses.

The labor agreements are a major step for Mesaba to emerge from bankruptcy, but not the only one. It still has to renegotiate with its vendors, reduce its overhead expenses and renegotiate aircraft leases.

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