mesaba2425
Hmmmmm
- Joined
- Aug 27, 2002
- Posts
- 280
Surprise, surprise.
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http://www.startribune.com/stories/535/4349414.html
NWA to keep Avros in Mesaba fleet
Liz Fedor, Star Tribune
Published January 31, 2004 MESA31
Northwest Airlines will keep its four-engine Avro jets in the Mesaba Airlines fleet, a decision that means the smaller, regional carrier will not lose 40 percent of its revenue.
Mesaba is expected to formally announce Northwest's decision on the Avro next week. On Friday, the Mesaba branch of the Air Line Pilots Association (ALPA) reported that a five-year contract agreement has been ratified by 66 percent of the pilots who cast ballots.
The new pact, which was signed Friday afternoon, gives Mesaba's 844 pilots immediate pay raises ranging from 5 to 27 percent. It took more than two and a half years to reach an agreement, which ultimately was negotiated in a marathon session after a Jan. 9 strike deadline passed.
Friday's developments are welcome at Eagan-based Mesaba, which just a few weeks ago was in danger of losing all of its regional jets and was facing its first strike in the airline's 60-year history. After going into the overtime contract talks, the airline's management and pilots averted what could have been a costly strike.
In October, Northwest CEO Richard Anderson expressed interest in soliciting bids from multiple regional carriers to fly Mesaba's Avro routes with two-engine aircraft. The threat of losing the Northwest contract clouded Mesaba's future and hung over the negotiations.
Northwest acquired 36 Avros between 1996 and 2000, and Mesaba has been flying the jets under a long-term service agreement.
"The operating costs of the Avro are significantly higher than other aircraft that could operate in similar markets," Anderson said in an October conference call with analysts and reporters.
Two weeks ago, Mesaba spokesman Dave Jackson said that his management still considered the Avro a "viable airplane" and that Mesaba had attempted to show Northwest how it could operate the Avro at a reduced cost.
An executive familiar with Northwest's decision said Friday afternoon: "A thorough study was completed and cost efficiencies were identified that allow Mesaba to continue flying the Avros for Northwest."
In response to the news about Northwest's decision, Mesaba's Jackson said, "We have not received any official notification from Northwest Airlines regarding the Avro decision."
Five of the 36 Avros were taken out of Mesaba's fleet in December and January, and they are parked in the Phoenix area.
Now that Northwest has decided to keep the Avros, two of those planes will be returned to Mesaba's schedule in April, and the other three planes will be back in service in June. No further details about the magnitude of the Avro cost savings were available Friday.
In mid-January, Robert Ashcroft, a UBS Investment Research analyst, said, "Northwest Airlines is on the hook for this aircraft whether it uses it or not." He estimated that Northwest has $494 million tied up in the financing of the Avros. Northwest leases 25 of the Avro RJ-85s and owns 11 of them.
"The likely revenue Northwest could expect from leasing the Avro out of the Northwest system would be unlikely to cover more than about half of what Northwest pays in rent and debt service," Ashcroft said in a report.
Northwest's service contract to fly Avros runs through April 25, 2007. That long-term contract has a clause that allows Northwest to terminate the contract early. Northwest could have severed the contract by giving notice in October, but it delayed its decision until December. Northwest postponed the Avro decision a second time, pushing it back until early this year to allow Mesaba time to settle its pilots' contract.
When Northwest raised the specter of pulling the plug on the Avros, pilot union leaders charged that Northwest was attempting to put pressure on Mesaba pilots at the bargaining table. But Northwest executives said they were merely exercising their right to use the early termination deadline, which was established years ago.
"The timing was quite coincidental to have that come out toward the end of the negotiations," Tom Wychor, chairman of Mesaba ALPA, said Friday. However, he added, the pending Avro decision "did not affect the negotiators."
Talks on the pilots contract opened in June 2001, and Wychor said the pilots did not deviate from focusing on key goals -- improvements in pay, retirement, job security and work rules. "The big piece that pilots were looking for all the way along was job security," Wychor said.
The Mesaba pact prevents MAIR Holdings, Mesaba's parent corporation, from using Montana-based Big Sky Airlines for expansion flying. Any new flying generated by MAIR or Mesaba Aviation must be done by Mesaba pilots. Big Sky, another MAIR subsidiary, is restricted to flying planes with 19 or fewer seats.
Compensation was a primary issue, and the pilots pressed for pay rates similar to other regional airlines -- Comair, Air Wisconsin and Atlantic Coast. "In the aggregate, our contract is in line with our peers. Our retirement stacks up with any of them," Wychor said.
The pilots voted 493 to 249 in favor of the agreement.
For 2003, pilots will receive retroactive paychecks ranging from $450 to $6,300. This year, Mesaba captains will get 5.1 percent pay raises, and first officers will receive raises of 13.4 to 26.7 percent. The contract includes 2 percent increases in years two and three and 4 percent increases in years four and five.
John Spanjers, Mesaba president, said in a Friday statement: "This contract should position us well to compete for growth with our partner Northwest Airlines, and it will also allow us to manage our costs through the continuing uncertainties in the airline industry."
There are 844 pilots on Mesaba's payroll, and they were averaging $17,352 to $85,445 a year under their old agreement. The new contract, based on years of experience, provides for salaries of $23,542 to $94,483. Both ranges are based on 85 hours of flight time per month.
-----------------------------------
http://www.startribune.com/stories/535/4349414.html
NWA to keep Avros in Mesaba fleet
Liz Fedor, Star Tribune
Published January 31, 2004 MESA31
Northwest Airlines will keep its four-engine Avro jets in the Mesaba Airlines fleet, a decision that means the smaller, regional carrier will not lose 40 percent of its revenue.
Mesaba is expected to formally announce Northwest's decision on the Avro next week. On Friday, the Mesaba branch of the Air Line Pilots Association (ALPA) reported that a five-year contract agreement has been ratified by 66 percent of the pilots who cast ballots.
The new pact, which was signed Friday afternoon, gives Mesaba's 844 pilots immediate pay raises ranging from 5 to 27 percent. It took more than two and a half years to reach an agreement, which ultimately was negotiated in a marathon session after a Jan. 9 strike deadline passed.
Friday's developments are welcome at Eagan-based Mesaba, which just a few weeks ago was in danger of losing all of its regional jets and was facing its first strike in the airline's 60-year history. After going into the overtime contract talks, the airline's management and pilots averted what could have been a costly strike.
In October, Northwest CEO Richard Anderson expressed interest in soliciting bids from multiple regional carriers to fly Mesaba's Avro routes with two-engine aircraft. The threat of losing the Northwest contract clouded Mesaba's future and hung over the negotiations.
Northwest acquired 36 Avros between 1996 and 2000, and Mesaba has been flying the jets under a long-term service agreement.
"The operating costs of the Avro are significantly higher than other aircraft that could operate in similar markets," Anderson said in an October conference call with analysts and reporters.
Two weeks ago, Mesaba spokesman Dave Jackson said that his management still considered the Avro a "viable airplane" and that Mesaba had attempted to show Northwest how it could operate the Avro at a reduced cost.
An executive familiar with Northwest's decision said Friday afternoon: "A thorough study was completed and cost efficiencies were identified that allow Mesaba to continue flying the Avros for Northwest."
In response to the news about Northwest's decision, Mesaba's Jackson said, "We have not received any official notification from Northwest Airlines regarding the Avro decision."
Five of the 36 Avros were taken out of Mesaba's fleet in December and January, and they are parked in the Phoenix area.
Now that Northwest has decided to keep the Avros, two of those planes will be returned to Mesaba's schedule in April, and the other three planes will be back in service in June. No further details about the magnitude of the Avro cost savings were available Friday.
In mid-January, Robert Ashcroft, a UBS Investment Research analyst, said, "Northwest Airlines is on the hook for this aircraft whether it uses it or not." He estimated that Northwest has $494 million tied up in the financing of the Avros. Northwest leases 25 of the Avro RJ-85s and owns 11 of them.
"The likely revenue Northwest could expect from leasing the Avro out of the Northwest system would be unlikely to cover more than about half of what Northwest pays in rent and debt service," Ashcroft said in a report.
Northwest's service contract to fly Avros runs through April 25, 2007. That long-term contract has a clause that allows Northwest to terminate the contract early. Northwest could have severed the contract by giving notice in October, but it delayed its decision until December. Northwest postponed the Avro decision a second time, pushing it back until early this year to allow Mesaba time to settle its pilots' contract.
When Northwest raised the specter of pulling the plug on the Avros, pilot union leaders charged that Northwest was attempting to put pressure on Mesaba pilots at the bargaining table. But Northwest executives said they were merely exercising their right to use the early termination deadline, which was established years ago.
"The timing was quite coincidental to have that come out toward the end of the negotiations," Tom Wychor, chairman of Mesaba ALPA, said Friday. However, he added, the pending Avro decision "did not affect the negotiators."
Talks on the pilots contract opened in June 2001, and Wychor said the pilots did not deviate from focusing on key goals -- improvements in pay, retirement, job security and work rules. "The big piece that pilots were looking for all the way along was job security," Wychor said.
The Mesaba pact prevents MAIR Holdings, Mesaba's parent corporation, from using Montana-based Big Sky Airlines for expansion flying. Any new flying generated by MAIR or Mesaba Aviation must be done by Mesaba pilots. Big Sky, another MAIR subsidiary, is restricted to flying planes with 19 or fewer seats.
Compensation was a primary issue, and the pilots pressed for pay rates similar to other regional airlines -- Comair, Air Wisconsin and Atlantic Coast. "In the aggregate, our contract is in line with our peers. Our retirement stacks up with any of them," Wychor said.
The pilots voted 493 to 249 in favor of the agreement.
For 2003, pilots will receive retroactive paychecks ranging from $450 to $6,300. This year, Mesaba captains will get 5.1 percent pay raises, and first officers will receive raises of 13.4 to 26.7 percent. The contract includes 2 percent increases in years two and three and 4 percent increases in years four and five.
John Spanjers, Mesaba president, said in a Friday statement: "This contract should position us well to compete for growth with our partner Northwest Airlines, and it will also allow us to manage our costs through the continuing uncertainties in the airline industry."
There are 844 pilots on Mesaba's payroll, and they were averaging $17,352 to $85,445 a year under their old agreement. The new contract, based on years of experience, provides for salaries of $23,542 to $94,483. Both ranges are based on 85 hours of flight time per month.
