Capt. Giambusso, who had just assumed the post as chairman of the master executive council at Delta's pilots' union, packed up his papers and walked out. Taken aback, Mr. Mullin said he never realized the board seat was a deal-killer. "I told him there was nothing to talk about," says Capt. Giambusso.
By contrast, at the corporate headquarters, many managers warmed to Mr. Mullin's enthusiastic, coach-like style. At meetings, he plants himself at the middle of the table, instead of the head, and solicits debate. He shuns many of the trappings of a CEO. After a mechanic complained about work conditions at the Atlanta airport, Mr. Mullin set his alarm for 3 a.m. and joined him on the night shift.
But the pilots bog him down in what he sees as an endless sea of rules. "We have to argue about seat configuration and assignment processes," he complains.
Many pilots came to see Mr. Mullin and his management team as bean-counters. Mr. Mullin spent much of his career at First Chicago Corp., where he was in line to be CEO of the big banking company before its acquisition by NBD Corp. At Delta, he never tried to revive the culture of the "Delta family" that prevailed before the downsizing.
"It's just not a term that I would use," Mr. Mullin said in a recent interview. "There's a distinction between what I truly think are families and kind of being in business."
His relationship with the pilots took a sharp dive last October. The union laid out an opening contract proposal so high that Delta figured it would wipe out the company's pretax profits. Then Delta, after months of promising "top pay for top performance," unveiled its opener: an arcane plan linking pilots' pay to financial performance and pilot efficiency.
The proposal bombed. Within days, most pilots stopped volunteering for overtime trips in protest. Delta relies on such volunteers to sign up to be on call for an extra trip during the month, in addition to their normal flying schedules of about 75 hours. Delta faced mounting cancellations.
At Capt. Giambusso's urging, Mr. Mullin agreed to request federal mediation on a 90-day timeline. If the parties didn't settle by Feb. 28, they would seek release from the fixed process to begin a 30-day countdown to a possible strike.
Despite the fast-track plan, the pilots didn't end their overtime protest. Mr. Mullin gave the green light to sue the union and 49 individual pilots in federal court.
The lawsuit proved to be a big headache. Delta lost the first round when a federal judge refused to enjoin the union. Then an appeals court declined to set a hearing until Jan. 9 -- after the holidays were over. Delta trimmed its schedule to reduce its reliance on overtime flying, but it wasn't enough to prevent a holiday fiasco. Hundreds of cancellations left passengers fuming. By the time Delta got an injunction in February, the damage was done.
In February, Mr. Mullin offered to give the pilots the highest pay in the industry. Many pilots liked the rich pay offer, but the union didn't budge on the remaining tough issues.
With time running short, Mr. Mullin arranged a meeting Feb. 14 at the White House with Lawrence Lindsey, President Bush's chief economic adviser, and pleaded for intervention, if necessary. Two days earlier, ALPA reported that 97% of the pilots had given it approval to call a strike. "We're talking about something that is extraordinarily harmful to the public interest," said Mr. Mullin in an interview earlier this month.
His concerns were echoed by other airlines in similar straits, and on March 9 President Bush announced he would "take the necessary steps" to prevent airline strikes this year. A presidential emergency board could deter a strike for 60 days while it tried to broker a solution.
When talks resumed last Wednesday under the guidance of the National Mediation Board, Norman Mineta, the Transportation Secretary, was prodding the two sides to settle in order to avert the need for presidential intervention.
Delta negotiators were willing to give on money issues but were reluctant to cede too much managerial control. Mr. Mullin managed to squelch an effort to give the pilots a voting board seat.
Still, the union scored big gains in mapping Delta's strategy, particularly in the area of regional jets, which are flown by a separate group of commuter pilots who have much lower pay scales. Delta acquiesced to limits on the use of the regional jets to bypass hubs such as Atlanta. It bowed to caps on the distance the small jets are allowed to fly.
Delta also agreed to increase its mainline fleet in proportion to expansion of its fleet of 50-seat regional jets. While Delta retained the right to buy up to 57 of the larger 70-seat regional jets already in its plans, it will have to increase the size of its mainline fleet if it wants to buy more.
Meanwhile, Delta agreed to largely eliminate lower pay rates at Delta's low-fare unit, Delta Express, making it harder for that venture to compete with low-fare carriers such as Southwest Airlines. The best Delta could achieve was to preserve some flexible work rules at the low-fare unit and to win the right to expand it, using new Boeing 737-700s.
Mr. Mullin says he's now eager to move ahead to heal the wounds. "I feel very good about the prospects of rebuilding the sense of trust and respect that I wanted to build at Delta." As for Capt. Giambusso, he says he hasn't spoken to Mr. Mullin since December
Generally that is the way the Delta MEC has conducted themselves - they demand - then they storm out of the room like two year olds if they don't get what they want. It is not very constructive