NWA Gets Cost-Cutting Changes it Wanted

Northwest Airlines Inc. has not only implemented many of the cost-cutting changes its mechanics and plane cleaners wouldn't accept before they struck the carrier, it's already reaping the savings it would have gotten had its workers agreed to those concessions, the airline's CEO said Wednesday.

Those savings measure about $176 million a year, or more than $3.3 million a week, now that Northwest replaced its union mechanics, considered some of the highest-paid among their peers in the industry.

"I think we're realizing, post-strike, some savings ... consistent with the savings we sought from AMFA," Northwest President and CEO Doug Steenland said in an interview with the Free Press.

AMFA is the Aircraft Mechanics Fraternal Association, which represents 4,400 striking mechanics and plane cleaners at Northwest. The group walked off the job Saturday morning, refusing to cut nearly half its workforce and take a 25% pay cut.

The airline replaced its mechanics with 1,200 replacement workers, led by what Steenland called a "dream team" of 350 Northwest managers who are fixing planes and supervising replacements.

Steenland said the airline's operations have been improving since Saturday. Replacement mechanics dealt with mechanical problems left over from before AMFA went on strike.

"There was a period of recovery that needed to take place," he said.

Steenland wouldn't say when the airline would decide to offer temporary replacements permanent jobs.

Despite the savings Northwest has achieved with replacement mechanics, the airline hasn't shaken the threat of bankruptcy, especially with oil prices at record highs.

Northwest expects to pay $3 billion for jet fuel this year. That's more than 60% higher than what it paid last year.

"You have to assume that the price of fuel is going to stick in this current environment, which obviously presents a substantial challenge," he said.

Detroit Free Press