Skies Safer, Despite Airline Woes

It seems a happy paradox: While the U.S. airline industry has been going through wrenching and seemingly endless post-9/11 economic turmoil, its safety record has never been better.

Thousands of the industry's most experienced pilots have taken early retirement, and veteran mechanics have been displaced as financially stressed carriers cut jobs and outsource work they used to do themselves.

Delta Air Lines has shifted many of its aircraft overhauls to vendors in Miami and Vancouver, British Columbia, and striking Northwest mechanics were replaced en masse. Unions warn that replacements are poorly trained, and the AFL-CIO's transportation trades department say lax FAA oversight of contract workers is "inexcusable and dangerous."

"We're developing a gypsy work force of aircraft mechanics and technicians who have far less experience than the people they're replacing," said Dave Suplee, an International Association of Machinists safety director.

But Marshall Filler, managing director for the Aeronautical Repair Station Association, a trade group representing firms that perform contract maintenance work, said the airline industry's recent safety record showed such fears were a "red herring."

"People have been hurt economically by this trend toward contracting," Filler said. "People have lost jobs and pensions. But it's not a safety issue. It's an economic issue cloaked as a safety issue."

Not counting the four 9/11-related crashes, airlines since 1998 have chalked up an unusually safe stretch, based on the rate of fatal accidents per million departures. During that span, the highest annual rate was 0.196 in 2003, when 21 passengers died in a US Airways Express crash. The lowest was in 2002, when there were no fatalities.

Delta, now in Chapter 11 proceedings, began sending much of its heavy maintenance --- the periodic disassembly and rebuilding of airframes and engines --- to contractors in Miami and Vancouver this year. JetBlue and America West take their fleets to El Salvador, Northwest and Continental have repair stations in Hong Kong and Singapore, and United recently began flying its 777s to China for heavy maintenance.

Delta expects to lower maintenance costs 34 percent through outsourcing and reducing its own work force. Avborne in Miami will perform some Delta airframe overhauls, and ACTS in Vancouver won a $ 300 million contract to do others. Avborne also overhauls airframes for AirTran.

Delta has cut its work force from 76,000 at its 2001 peak to about 53,000 today, and it expects to cut up to 9,000 more jobs by the end of 2007. Delta has said about 2,000 jobs will be eliminated from its Technical Operations Center, based in Atlanta.

Tony Charaf, Delta's senior vice president for technical operations, said the contractors Delta used were "absolutely committed" to meeting the airline's safety standards.

"We've trained our suppliers on Delta-specific policies and procedures," Charaf said. "They'll meet our standards --- not theirs. I'm very comfortable with the process. Safety will never be compromised."

About 40 Delta employees oversee the work performed by contractors, Charaf said, and a team of pilots, flight attendants and mechanics inspects each overhauled airplane before it returns to the Delta fleet.

"This is the right strategy for Delta's survival," he said.

Richard Aboulafia, aerospace analyst at the Teal Group, credits new, technologically advanced aircraft for lowering the amount of maintenance each plane requires. Major carriers have parked their older, most maintenance-intensive aircraft in desert boneyards.

"Aircraft are getting more maintenance-friendly," he said, "and there's better diagnostic equipment available."

Companies like General Electric, Rolls-Royce and Pratt & Whitney perform some of the outsourced work by repairing components they originally built.

"These aren't Tijuana body shops," Aboulafia said. "They're leading companies that do highly specialized work. Specialization is a virtue, and they've built a critical mass where they can offer a great deal of expertise."

Paul Nisbet, aerospace analyst at JSA Research, says airlines and the Federal Aviation Administration hold contractors to the same standards as airline employees.

"The FAA uses the same regulatory process," Nisbet said. "And airlines know they stand to lose an awful lot more if the work isn't done right than they could ever hope to gain in cost savings."

FAA officials say the agency keeps a close watch on airlines in financial distress and conducts "enhanced surveillance" of carriers in economic trouble. The additional scrutiny is meant to ensure the airlines aren't tempted to cut corners on safety.

"We target specific areas if we feel they need additional attention," said Kathleen Bergen, an FAA spokeswoman in Atlanta.

"We have inspectors around the country, and they can be assigned to various airlines. Long before the airlines are close to bankruptcy, we develop specific oversight plans. We prioritize the work and assign people as needed."

The union that represents about 2,700 FAA airline inspectors, however, says they are understaffed and can't keep up with demand.

"The workload is incredible --- and we're losing staff," said Kori Blalock, spokeswoman for the Professional Airways System Specialists.

"Given the state of the industry, it's virtually impossible for our inspectors to physically get to the foreign repair stations they're supposed to inspect."

Despite the industry's overall stellar record of late, two tragedies involving outsourced maintenance are well remembered.

The most recent was the US Airways Express crash, just after takeoff from Charlotte in early 2003. The accident was blamed in part on an inexperienced mechanic at a contract maintenance center who incorrectly installed a control cable.

Perhaps the most notorious fatal mistake took place in May 1996 when SabreTech workers sent mislabeled and loosely packed boxes of surplus emergency oxygen generators for shipment in the cargo hold of a ValuJet DC-9 in Miami. Investigators concluded that the generators, which create intense heat when activated, were accidentally triggered shortly after takeoff and sparked a fire that took down the Atlanta-bound plane and killed 110 passengers and crew.

The National Transportation Safety Board said that ValuJet --- which now flies as AirTran --- SabreTech and the FAA all shared blame. The carrier beefed up its in-house maintenance and contractor oversight after a safety grounding.

Today, AirTran spokesman Tad Hutcheson said, AirTran outsources heavy maintenance, with engine repair work going to GE and Rolls-Royce overhauling engines.

"GE does thousands of engine overhauls a year, and they're very good at it," Hutcheson said. "With our fleet of 104 airplanes, it doesn't make any sense for us to have our own engine shop. The manufacturer that built our engines knows how to repair them better than we do."

AirTran's maintenance director has an office at Avborne's Miami airframe overhaul center, and an AirTran team monitors the work there.

"They make sure the vendor is doing quality work," Hutcheson said.

Avborne and ACTS, the two companies hired by Delta, declined to comment for this article.

But ACTS Chairman Robert Milton, who also leads the holding company that owns Air Canada, said in March the five-year contract to overhaul Delta's 757-200s, 767-300s and 767-300ERs reflected the company's "worldwide reputation for safety and reliability and underscores our cost competitiveness."

American Airlines is countering the outsourcing trend. The Dallas-based company performs 80 percent of its own maintenance and all airframe overhauls.

"We're actively bringing work back in," said Courtney Wallace, an American spokeswoman, who said the company planned to make its 7,000-employee Tulsa, Okla., maintenance facility a profit center by repairing planes for other carriers, too. Delta and other big carriers also court "in-source" business to varying degrees.

"We've been able to streamline our operations and do our own work better and faster," Wallace said.

"We benchmark ourselves against the competition, and our work force consistently shows that it's the best in the industry. We know our people, and they're our greatest resource. They ensure the quality and safety of our fleet."

Suplee, the IAM union safety chief, doesn't concede that the recent safety record shows outsourcing is perfectly safe.

"Aircraft maintenance is going to the lowest bidder," he said.

"The airline industry may have a good safety record now, but eventually, these kinds of policies are going to catch up to them."

SAFETY IN THE SKIES: Despite economic turmoil and maintenance outsourcing, airlines since 1998 have compiled the safest stretch in industry history, in terms of the rate of fatal accidents. Here are statistics for the past 20 years, as compiled by the Air Transport Association, an industry trade group:

..................................Fatal accidents ......Total

..........Aircraft........Fatal ....per million .....onboard

Year....departures....accidents......departures ..fatalities

2004....10.55 mil. ........1 ..............0.095 ..........13

2003....10.22 mil. ........2 ..............0.196 ..........21

2002....10.28 mil. ........0 ..............0.000............0

2001....10.63 mil. ........6 ..............0.188..........525

2000....11.05 mil. ........2 ..............0.181 ..........89

1999....10.86 mi...........2 ..............0.184 ..........11

1998....10.54 mil. ........1 ..............0.095............0

1997 ....9.93 mil. ........3 ..............0.302............2

1996 ....7.85 mil. ........3 ..............0.382..........342

1995 ....8.11 mil. ........1 ..............0.123..........160

1994 ....7.83 mil. ........4 ..............0.511..........237

1993 ....7.72 mil. ........1 ..............0.130............0

1992 ....7.52 mil. ........4 ..............0.532 ..........31

1991 ....7.50 mil. ........4 ..............0.533 ..........49

1990 ....7.79 mil. ........6 ..............0.770 ..........12

1989 ....7.27 mil. ........8 ..............1.101..........130

1988 ....7.35 mil. ........3 ..............0.272..........274

1987 ....7.29 mil. ........4 ..............0.411..........229

1986 ....6.93 mil. ........2 ..............0.144............4

1985 ....6.07 mil. ........4 ..............0.659..........196

Note: Incidents resulting from illegal acts are included in accident and fatality totals but not in rates, the way the National Transportation Safety Board reports statistics.

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