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Mesaba Update 01/10/2004

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jetbluedog

Well-known member
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Dec 20, 2003
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176
Mesaba Airlines canceled all flights today as negotiators for the company and the union representing its pilots continue negotiations on a new contract for the Bloomington airline.

Mesaba's pilots had set a strike deadline for 11:01 p.m. Friday but extended that after negotiators reported progress at the bargaining table.

"Hopefully, we will get a deal done this evening," Tom Wychor, head of the Mesaba pilots union, said at 11:05 p.m. Friday.

Negotiators were still meeting at noon today, more than 24 hours after the latest round of talks began. Mediators from the National Mediation Board were at the table to help the talks along.

Mesaba flies as an Airlink partner for Northwest Airlines. It carried 5.7 million passengers in 2003. A Mesaba pilot strike would shut down the carrier, leave seven Minnesota cities without air service and potentially jeopardize the future of the 60-year-old airline.

Some Mesaba employees are on the job today, including mechanics who are doing maintenance work on the carrier's fleet.

The airline kept its planes on the ground at its hubs in the Twin Cities, Detroit and Memphis, as well as in Cincinnati and the Wausau, Wis., area.

Mesaba passengers are asked to call Northwest Airlines at 1-800-225-2525 to check on the status of their flights. Several days ago, Northwest Airlines put a rebooking policy in place that allowed Mesaba customers to rebook their trips on flights flown by Northwest and Pinnacle Airlines, a Memphis-based regional carrier.

"If we are unable to reconcile our differences with management within a limited period of time, we will declare a strike," Wychor said Friday night.

Will Holman, a spokesman for the Air Line Pilots Association (ALPA), the union that represents Mesaba's 844 pilots, said the limited amount of time would be "hours instead of days."

Mesaba's management and its pilots have spent two-and-a-half years trying to negotiate a new contract. They've done so against a backdrop that includes a prolonged slump across the entire aviation industry. While Mesaba has remained profitable, its growth has slowed and its importance to Northwest Airlines has waned.

Mesaba flies on a contractual basis for Northwest, which owns about 28 percent of Mesaba's stock and, for better or worse, controls its fate.

Northwest owns or leases Mesaba's planes, sets its fares, sells its tickets and assigns its routes. And in recent years, Northwest has sent its newest, most efficient jets to another, faster-growing Airlink partner, Memphis-based Pinnacle Airlines. That has left Mesaba with an older fleet of planes that fly lower and slower and are more costly to operate and maintain.

Mesaba's management had sought a contract that would control its labor costs and make it better able to compete for new planes and new flying from Northwest.

ALPA, which represents pilots at Mesaba and most other carriers, pressed for improved pay, retirement and job security, at a time when its leverage with Northwest was slipping.

Starting pilot pay at Mesaba is $17,000, one of the lowest starting salaries in the industry. About 65 percent of Mesaba pilots earn $30,000 to $57,000 a year, according to union figures. Many of the Mesaba pilots hold second jobs to meet their living expenses.

U.S. Rep. Jim Oberstar, D-Minn., said Friday afternoon that he has monitored the prolonged contract talks by chatting with pilots on flights throughout his northern Minnesota district the past few years.

"These Mesaba pilots are like dairy farmers in my district," Oberstar said. "They subsidize their vocation with an avocation, a second job."

Despite the growth of Pinnacle, Mesaba remains important to Northwest's overall future.

Regional jets, operated by pilots who earn one-third to one-half of their counterparts at the major airlines, have become increasingly important to the growth of big airlines.

Northwest uses Mesaba, Pinnacle Airlines and others to fetch passengers from small towns and bring them to their hubs in Detroit, the Twin Cities and Memphis.

Traffic from those remote locales often is small but lucrative; the fares are relatively high, and the passengers frequently make connecting flights to other destinations on Northwest's big jets.

Only 21 passengers flew between Sioux City, Iowa, and the Twin Cities each day in the first quarter of 2002, for example, but the average one-way fare for the 234-mile trip was $223.56, according to government data.

Mesaba, facing the prospect of a strike, canceled 48 flights Friday even as negotiators for the airline and the pilots union huddled in conference rooms at a Bloomington hotel.

The flights were canceled as a precaution, a Mesaba spokesman said, and were not a signal that a strike was inevitable. Talks between the pilots and the company, after breaking at 2:30 a.m. Friday, resumed six hours later and continued throughout the day.

Mesaba flies Saab turboprops and Avro regional jets to 112 cities in 30 states and Canada. Last year, it transported 5.7 million passengers, which compares with 51.9 million carried by Northwest.

If the pilots strike, seven Minnesota cities would lose scheduled passenger service because Mesaba is their only carrier. Those communities are Bemidji, Brainerd, Grand Rapids, Hibbing, International Falls, St. Cloud and Thief River Falls.

High stakes

A strike could be potentially catastrophic for Mesaba. In the fiscal year ended March 2003, the airline earned $13.8 million before taxes on sales of $451.1 million, all of which came from flying passengers for Northwest. During a strike, it would lose about $1.2 million a day in revenue yet still be obligated to make lease payments for its planes and facilities. Rent of its hangars and office space, for example, totals almost $300,000 a month.

In the event of a strike, Northwest Airlines, Mesaba's only customer, could cancel its contract and permanently shift those routes to another small carrier.

Talks between Mesaba and its pilots began in June 2001, but the parties struggled to find common ground on compensation, job security, retirement and work rules even as the financial health of the airline industry deteriorated.

Since 2001, Northwest has lost $1.3 billion, cut about 14,000 workers and closed facilities. It is seeking to reduce its labor costs by about $950 million a year.

At headquarters

The pilots' strike headquarters, set up in a Bloomington office building, were frenetic with activity Friday afternoon as pilot volunteers answered phones and tracked aircraft arriving and departing from Minneapolis-St. Paul International Airport. A cell phone seemed to ring every few seconds as anxious family members checked on the progress of talks or as pilots called in to sign up for picketing duty.

"I'd say the atmosphere here is pretty tense," said Kevin Roche, a spokesman for the local ALPA chapter. "We've been preparing for this for a long time. It's not like it snuck up on us."

Mesaba employs about 3,300 people, including 1,700 in Minnesota. If the pilots strike, most of Mesaba's other employees are likely to be laid off.

Oberstar has not inserted himself into the contract talks and said he does not expect that the Bush administration would appoint a presidential emergency board to resolve the conflict.

"I don't think the pilots are asking management to give away the store," Oberstar said. "There is no reason why I have seen that these negotiations should have gone on so long. Management has the responsibility to get it done."
 

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