Northwest Airlines Inc. and its striking union mechanics are scheduled to resume talks today amid signs of further economic trauma at the nation's fourth-largest airline.
In a new round of talks, the mechanics face the prospect of even deeper cuts, after Northwest told the Aircraft Mechanics Fraternal Association that its financial woes are worse than they were before the mechanics went on strike nearly three weeks ago.
The dominant airline at Detroit Metro Airport, Northwest also established Tuesday as a new deadline to start permanently replacing union mechanics. The airline has about 900 union mechanics at Metro, where it carries more than 60 percent of the passengers.
Talks are slated to take place today in Minneapolis, according to an AMFA message to its members. It would be the first time that the two sides have met since negotiations broke off Aug. 19, leading AMFA to walk off the job and the airline to hire replacement mechanics.
The Eagan, MN-based airline, in a letter to AMFA on Tuesday, described its deteriorating financial condition.
The airline said it will likely increase the $1.1 billion in concessions the airline wants from its unions. High fuel prices and steady losses, Northwest said, give the airline less time to cut labor costs and avoid a Chapter 11 bankruptcy filing.
The airline said Wednesday that fuel prices are so high that it plans to indefinitely suspend its daily direct flight from New York's JFK Airport to Tokyo.
In the letter to AMFA, Northwest said: "Our last best offer which was presented to you on Aug. 18 was based on economic circumstances that no longer exist today. While the company was prepared to stand behind that offer in order to obtain a consensual agreement, unfortunately, we are no longer able to do so."
Union officials declined to respond to the letter. "I'm going to see what they're going to say tomorrow at the table," said O.V. Delle-Femine, AMFA's national director told the Associated Press.
Northwest wouldn't specify what it plans to ask the union.
But one labor expert said the airline's message is clear.
"It's not a question of, let's see if we can find a middle ground. They're back to the hardball strategy of essentially telling the union, 'We don't need you and if you come back to the bargaining table we're going to ask of even more of you,' " said Gary Chaison, professor of management at Clark University in Worcester, MA.
But Chaison also said the threat of deeper cuts could be Northwest's strategy to get AMFA to agree to its last offer.
Legally, Northwest can replace the mechanics, said John Raudabaugh, partner in the Detroit law firm Butzel Long.
"The law really is one of the economic survival of the fittest," said Raudabaugh, who served on the National Labor Relations Board between 1990 and 1993.
While a new round of talks might seem an even greater challenge for AMFA, Chaison said the union needs to keep talks going.
"As long as the parties are talking, something can be accomplished," he said.
What's unusual here, Chaison said, is that Northwest appears to be making the next demands.
"Northwest has gone on the offensive, and the union is the defensive party. Usually in bargaining it's the other way around," he said. "This is not textbook bargaining."
Meanwhile the local mechanics union made an unusual move Tuesday and early Wednesday by holding a picket line at a rail yard in Toledo.
Union workers for CSX Transportation Inc. and Norfolk Southern Corp. honored AMFA's picket line, slowing traffic at the terminal.
CSX filed for a temporary restraining order to keep its employees from honoring another AMFA picket line.
Separately, the airline said Wednesday that, despite the strike, Northwest filled more seats in August than it did during the same month last year.
The airline said that in August, it filled 84.8 percent of its seats, 1.5 percentage points higher than the same month last year.