News Cut Category Archive: Northwest Airlines

FAA on NWA Flight 188: 'We could've done better'

Posted at 9:45 AM on November 13, 2009 by Bob Collins (4 Comments)
Filed under: Northwest Airlines

Federal Aviation Administration officials held a conference call today to describe its process for tracking airliners that are out of contact with ground controllers. In the process, officials basically confirmed almost every element of an analysis of its response that we posted here the day after the incident.

I've written plenty about the here.

Here's the live blog account of today's conference call. The participants were Randy Babbitt, the administrator of the FAA, and Hank Krakowski, the chief operating officer of the FAA's Air Traffic Organization:



Here's the audio from the news conference:

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Was Flight 188 out of radio contact for three hours? Probably not.

Posted at 12:11 PM on November 5, 2009 by Bob Collins (3 Comments)
Filed under: Northwest Airlines

Fox News is reporting that Flight 188 -- the Northwest Airlines flight that overshot its Minneapolis destination a few weeks ago -- was out of radio contact for three hours.

Sources told FOX News there were three NORDO's --- or non-contacts -- the first one occurring shortly after the plane reached cruising altitude out of San Diego. The military was not notified until after the third NORDO -- which occurred as the plane approached Minneapolis.

If the insinuation that this is one big hunk of silence is true, it undercuts the pilots' story that they were too busy on their laptops and it undercuts the assertion of others that they probably fell asleep from the sheer boredom of flying an airliner these days.

A better explanation? Fox News is wrong.

According to the report, the plane lost contact shortly after reaching cruising altitude. That occurred at 5:30 p.m. (Central Time) according to the flight log.

But at 6:18 p.m., the flight changed altitude from 35,000 feet to 37,000 feet. That couldn't and wouldn't have happened without an instruction from the ground.

In addition, the FAA letter to the pilots that revoked their licenses said this (click for a larger view):

That's a typical controller handoff and would not have occurred that way if the pilots weren't talking to him or her. And that means the flight must have been also handed off properly from controllers in Albuquerque at 6:36 p.m., about 50 minutes earlier.

The letter from the FAA piled on about as much on the two pilots as any letter ever sent to a pilot, and yet it mentioned nothing about losing radio contact earlier in the flight. And all the evidence points to the original story being correct.

At 8:16 p.m., the flight began a descent, the first indication that the pilots were back in control of the airplane and communicating. That's 52 minutes.

There may well have been periods when the pilots didn't answer a particular call. But that's not at all unusual, and it's not a story.

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FAA smackdown

Posted at 10:06 AM on November 2, 2009 by Bob Collins (0 Comments)
Filed under: Northwest Airlines

One of the more surprising -- and disturbing -- aspects of the story surrounding Northwest Airlines Flight 188 (that's the one where the pilots were so busy with their laptops that they forgot to land the airplane) has been the number of other airline pilots who have been posting on various professional bulletin boards that it wasn't a big deal. Many have said -- perhaps with some justification -- that the jet landing on a taxiway in Atlanta was a bigger story.

Maybe it was, maybe it wasn't, but it's obvious the FAA, which revoked the pilots' licenses last week, don't think so.

Today, I got a copy of the letter the FAA sent last week to pilot Tim Cheney, and have posted it here.

It's unlikely you'll ever read a more harshly worded letter from a federal agency.

It also has the clearest indication yet of what happened (or didn't) and when.

Meanwhile, the New Yorker Cartoon Lounge takes a typical swing at the story, with its theory of what happened:

CHENEY: O.K., I'm gonna go to sleep, you keep flying the plane.

COLE: O.K.

(Fifteen minutes later.)

COLE: Shoot, did he say he was gonna go to sleep and I should keep flying the plane, or that I should go to sleep and he would fly the plane?

COLE: If only he weren't asleep, I could ask him!

COLE: Hmm. I'm pretty sure he said I should go to sleep and he'd fly the plane. Yeah, now that I think about it, that sounds right.

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General: Fighter jets should've been airborne over Minneapolis

Posted at 12:25 PM on October 29, 2009 by Bob Collins (12 Comments)
Filed under: Northwest Airlines

Now that Federal Aviation Administrator Randy Babbit has answered the question that even Department of Homeland Security secretary Janet Napolitano wouldn't touch -- why were homeland security officials frozen out of the Flight 188 situation? -- the mea culpas are coming from the military... sort of.

The Associated Press reports that Gen. Gene Renuart, who heads U.S. Northern Command, said he learned of the incident just four or five minutes before the Federal Aviation Administration regained contact with the Northwest Airlines pilots, who were out of touch with air traffic controllers for more than an hour as their jet sped toward Minneapolis St. Paul.

Renuart says fighter jets should've been airborne. He says Northern Command is conducting an "internal review."

Coincidentally, Gen. Renuart's command is hosting 4,500 military and civilian personnel from around the country next week to take part in a training expercise simulating a terrorist attack in the United States.

(h/t: Sara Meyer)

Meanwhile, the safety woes for the airlines continue. The FAA says a Midwest Airlines jet came within 82 feet of the nose of a departing Northwest Airlines jet at Los Angeles on Sunday, violating rules designed to prevent collisions on runways.

It's not easy being the air traffic controller in charge of preventing these things as this situation in New York a few years ago revealed:

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After 188

Posted at 4:17 PM on October 28, 2009 by Bob Collins (0 Comments)
Filed under: Northwest Airlines

As we move past the particulars of the two pilots who "overshot" Minneapolis in their Northwest Airlines Airbus last week, some systemic problems (no, not the "crew rest" problem) are coming to light:

USA Today reports that the communication system used by the FAA and airlines is relatively antiquated:

Even though the radio may not be to blame for the Northwest Airlines mishap, the difficulty that controllers and the airline had in reaching the cockpit underscores the weaknesses of the equipment.

"I've been waiting for 15 years for the day when we're no longer dependent on voice communications," said Patrick Veillette, a corporate pilot and aviation safety researcher. "It can't come soon enough."

When a jet flies across the country, its pilots have to change radio frequencies dozens of times. With each change, controllers read a new frequency to pilots, who manually change their radios. According to controllers and pilots, mistakes occur frequently, though most are minor and short-lived.

There have been a few changes in the technology of communication, but for the most part the way air traffic control works in the United States is the same way it worked when we called flight attendants stewardesses and we were encouraged to fly a particular airlines because they were sexy.

The FAA has been considering a technical overhaul of the skies. But it's plan -- dubbed NextGen -- has been beset by budgetary, technological, and bureaucratic problems.

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Homeland Security chief avoids Flight 188 intercept question

Posted at 12:55 PM on October 27, 2009 by Bob Collins (5 Comments)
Filed under: Northwest Airlines

Janet Napolitano, the secretary of the Department of Homeland Security, punted today when MPR's Cathy Wurzer asked when FAA officials notified homeland security officials that a jetliner was heading for Minneapolis St. Paul and officials didn't know for sure who was in control of it.

"There are protocols in place for when actual military planes are used in situations like this," Napolitano said.

"What you're asking me involves a commercial plane involves another type of dimension and the NTSB is doing an investigation. Rather than announce it now, we should await the results of the investigation."

The NTSB investigation does not involve the response time or the coordination of air defense response to it.

By the way, here's what it looks like when military jets intercept an aircraft. If it's night-time, would those flares have caught the attention of a napping/Web surfing/laptop searching set of pilots?

The Northwest debacle, and a Delta jet that landed on a taxiway in Atlanta instead of the runway, has refocused attention on the "human factors" of getting us from Point A to Point B.

And so has the Air France crash months ago on a Brazil to Paris flight. Just this week, in fact, the debate internally over whether a crew error or faulty equipment cost the lives of hundreds of people spilled out in the open.

In a strongly worded internal memo, Air France has warned its pilots to be more vigilant about safety procedures and upbraided those blaming flight equipment for the crash of Flight 447 into the Atlantic in June.

No one knows what caused the accident, which killed all 228 people aboard and was Air France's deadliest crash. Pilots' unions said Saturday the company is trying to distance itself from blame -- and shift attention to the possibility of human error -- as the investigation drags on.

"Enough Scandals and False Debates about Flight Security!" reads the memo, sent to pilots Tuesday and obtained by The Associated Press on Saturday. It dismisses calls by pilots for new safety procedures following Flight 447's crash. "It suffices simply to apply our doctrine, our procedures," the memo says.

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Flight 188: The explanation

Posted at 2:08 PM on October 26, 2009 by Bob Collins (30 Comments)
Filed under: Northwest Airlines

The NTSB just issued this release:

In its continuing investigation of an Airbus A320 that overflew the Minneapolis-St Paul International/Wold-Chamberlain Airport (MSP), the National Transportation Safety Board has developed the following factual information: On Wednesday, October 21, 2009, at 5:56 pm mountain daylight time, an Airbus A320, operating as Northwest Airlines (NWA) flight 188, became a NORDO (no radio communications) flight at 37,000 feet. The flight was operating as a Part 121 flight from San Diego International Airport, San Diego, California (SAN) to MSP with 144 passengers, 2 pilots and 3 flight attendants.

Both pilots were interviewed separately by NTSB investigators yesterday in Minnesota. The following is an overview of the interviews:

* The first officer and the captain were interviewed for over 5 hours combined.

* The Captain, 53 years old, was hired in 1985. His total flight time is about 20,000 hours, about 10,000 hours of A-320 time of which about 7,000 was as pilot in command.

* The First Officer, 54 years old, was hired in 1997. His total flight time is about 11,000 hours, and has about 5,000 hours on the A-320.

* Both pilots said they had never had an accident, incident or violation.

* Neither pilot reported any ongoing medical conditions.

* Both pilots stated that they were not fatigued. They were both commuters, but they had a 19-hour layover in San Diego just prior to the incident flight. Both said they did not fall asleep or doze during the flight.

* Both said there was no heated argument.

* Both stated there was a distraction in the cockpit. The pilots said there was a concentrated period of discussion where they did not monitor the airplane or calls from ATC even though both stated they heard conversation on the radio. Also, neither pilot noticed messages that were sent by company dispatchers. They were discussing the new monthly crew flight scheduling system that was now in place as a result of the
merger. The discussion began at cruise altitude.

* Both said they lost track of time.

* Each pilot accessed and used his personal laptop computer while they discussed the airline crew flight scheduling procedure. The first officer, who was more familiar with the procedure was providing instruction to the captain. The use of personal computers on the flight deck is prohibited by company policy.

* Neither pilot was aware of the airplane's position until a flight attendant called about 5 minutes before they were scheduled to land and asked what was their estimated time of arrival (ETA). The captain said, at that point, he looked at his primary flight display for an ETA and realized that they had passed MSP. They made contact with ATC and were given vectors back to MSP.

* At cruise altitude - the pilots stated they were using cockpit speakers to listen to radio communications, not their headsets.

* When asked by ATC what the problem was, they replied "just cockpit distraction" and "dealing with company issues".

* Both pilots said there are no procedures for the flight attendants to check on the pilots during flight.

The Safety Board is interviewing the flight attendants and other company personnel today. Air traffic control communications have been obtained and are being analyzed.

Preliminary data from the cockpit voice recorder (CVR) revealed the following:

* The CVR recording was 1/2 hour in length.

* The cockpit area microphone channel was not working during this recording. However, the crew's headset microphones recorded their conversations.

* The CVR recording began during final approach, and continued while the aircraft was at the gate.

* During the hours immediately following the incident flight, routine aircraft maintenance provided power to the CVR for a few minutes on several occasions, likely
recording over several minutes of the flight.

The FDR captured the entire flight which contained several hundred aircraft parameters including the portion of flight where there was no radio communication from the flight crew. Investigators are examining the recorded parameters to see if any information regarding crew activity during the portion of flight where radio contact was lost can be
obtained.

The "lost track of time" excuse is a difficult one to believe since the process to descend begins many miles away from a destination. So the pilots didn't just overshoot their destination by 150 miles, they overshot it by more than 250 miles.

Other than the usual union procedures, there doesn't appear to be anything stopping Northwest from firing the pilots now that they've admitted they were using their personal laptops rather than flying their airplane. As the release said, using a personal laptop is prohibited (so are things like bringing personal reading material on board). The aviation system is very keen on sending messages to other pilots who might be tempted to pull out the laptop on a flight.

The fairly cavalier attitude the pilots displayed in short interviews with the media betrays the reality of their situation. Their job -- and their only job -- was to fly the airplane. They didn't.

What's left to debate? This is no longer about fatique, the Wall St. Journal reports, it's about complacency.

Meanwhile, we might get an answer tomorrow about when FAA authorities first contacted homeland security officials about concerns the flight may have fallen into the hands of hijackers. Janet Napolitano, the Department of Homeland Security secretary, will be interviewed by Cathy Wurzer tomorrow on MPR's Morning Edition.

Update 5:21 p.m. - News release from Delta. It pretty much says the two pilots will be fired.

Delta Air Lines (NYSE: DAL) today issued a statement regarding the company's cooperation with the National Transportation Safety Board (NTSB) and the Federal Aviation Administration (FAA) in the investigation of Northwest Flight 188. Delta and its Northwest operating subsidiary continue to openly and fully cooperate with the NTSB and FAA to complete the investigation. The pilots in command of Northwest Flight 188 remain suspended until the conclusion of the investigations into this incident.

Using laptops or engaging in activity unrelated to the pilots' command of the aircraft during flight is strictly against the airline's flight deck policies and violations of that policy will result in termination.

Delta CEO Richard Anderson said: "Nothing is more important to Delta than safety. We are going to continue to cooperate fully with the NTSB and the FAA in their investigations."

The NTSB earlier today issued a public release highlighting the initial findings of its investigation into the incident, including evidence that the pilots involved said they were distracted at cruise altitude between San Diego and Minneapolis-St. Paul. The NTSB's press release stated that the pilots said in interviews that "there was a concentrated period of discussion where they did not monitor the airplane or calls from ATC even though both stated they heard conversation on the radio ... neither pilot noticed messages that were sent by company dispatchers ... both said they lost track of time ...(and) each pilot accessed and used his personal laptop computer while they discussed the airline crew flight scheduling procedure."

Update 5:42 p.m. - Sen. Al Franken is jumping in:

In light of the stunning admission that pilots were using personal laptops during last week's flight, which overshot its Minneapolis destination by 150 miles and lost radio contact for 75 minutes, U.S. Sen. Franken (D-Minn.) is calling for a ban on the use of personal laptops in the cockpit.

Sen. Franken has already requested an expedited National Transportation Safety Board (NTSB) investigation that re-examines the rules and regulations governing cockpit behavior.

"We don't tolerate texting while driving and we're certainly not standing for it while flying," said Sen. Franken. "It would be unthinkable to allow a driver to use a laptop. A pilot responsible for the lives of dozens if not hundreds of passengers needs to be that much more focused on the job."

NTSB preliminary findings have stated that the source of the distraction was not a "heated discussion of airline policy" as originally claimed, but the use of laptops in the cockpit, which can obscure the view of dashboard instruments and further distract pilots.

While the use of personal computers was prohibited by company policy, there is no national ban on the behavior. Sen. Franken is asking the Federal Aviation Administration to create a regulation prohibiting any pilot of any airline from using a personal laptop while flying a plane.

If the company already bans the laptops, what's the point of a "national ban"? The pilots already can be criminally charged if their actions put the lives of their passengers at risk.

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Pilots' story may surface on Monday

Posted at 8:07 PM on October 25, 2009 by Bob Collins (0 Comments)
Filed under: Northwest Airlines

The two pilots of Northwest Flight 188 talked to NTSB investigators today. NBC News, repeating what's leaked out over the weekend, has a flat denial from the pilot that the two pilots fell asleep when their Airbus jet overshot Minneapolis and headed into Wisconsin.

It'd be nice if one of them would say what they were doing instead of what they weren't, but the NTSB may clear that up on Monday.

The Wall St. Journal reported Sunday that airline officials are agreeing with the pilots that this wasn't a case of pilots falling asleep.

And later Sunday, the New York Times suggested the "heated discussion" that occupied the attention of the two pilots may have been about Delta's imposition of procedures on Northwest pilots. For the record, the Delta procedures do not include failing to initiate a descent or failing to land where you're supposed to.

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The Northwest jokes

Posted at 11:14 AM on October 25, 2009 by Bob Collins (0 Comments)
Filed under: Northwest Airlines

If someone makes a joke about Northwest Flight 188 but it's on the Jay Leno Show, does it make a sound?

(h/t: Marty Moylan)

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Pilots of Flight 188 had plenty of chance to rest

Posted at 9:47 AM on October 24, 2009 by Bob Collins (0 Comments)
Filed under: Northwest Airlines

The sound you hear today is the air going out of the balloon for many airline pilots who'd hoped the story of Flight 188 would focus more attention on pilot work rules they hinted were at the heart of Wednesday's blunder, when pilots of the Northwest flight failed to land in Minneapolis as intended.

The two pilots involved never claimed to have been asleep, telling investigators they were too busy having a "heated discussion" with each other to land the airplane in the Twin Cities. But many in the media used the incident to amplify ongoing labor strife at airlines over long days and workload; legitimate concerns, of course, but not necessarily relevant to this incident.

Why? Because the pilots had 17 hours of rest time before they began the San Diego to Minneapolis flight, the New York Times reports, citing sources in two different agencies.

That, of course, doesn't mean the pilots couldn't have fallen asleep, it just means that if they did fall asleep, it wasn't because they'd been working too hard in the airline business in the previous hours.

The Times also revealed the extent to which air traffic controllers were alarmed by the situation:

More than a dozen controllers, including those at three radar rooms tracking the flight -- one in Denver and two in the Minneapolis-St. Paul area -- tried to contact the pilots, said Doug Church, a spokesman for the National Air Traffic Controllers Association. "It was all hands on deck," Mr. Church said. One Minneapolis-area room made 13 attempts at contact, an official said. The plane was cruising at 37,000 feet about 400 miles west of Minneapolis when the crew stopped responding to air traffic controllers and airline dispatchers an hour and five minutes before its scheduled arrival time of 8:01 p.m., local time.

By the time the crew woke-up/stopped arguing, officials were concerned about the possibility the plane was hijacked, ordering the crew to make a series of turns to prove they were in control of the plane. Why it took authorities more than an hour to consider the possibility of a threat to the Twin Cities, and why nearby air defense systems weren't employed just in case remains an unanswered question, and likely will remain an unanswered question until oversight officials -- Congress -- starts asking it.

Meanwhile, first officer Richard Cole does himself no favors in an interview with the Associated Press. "It was not a serious event, from a safety issue. I would tell you more, but I've already told you way too much," he said.

He also undercut the original story the FAA said the pilots told investigators. "We were not asleep; we were not having an argument; we were not having a fight," Cole said.

"I can tell you that airplanes lose contact with the ground people all the time. It happens. Sometimes they get together right away; sometimes it takes awhile before one or the other notices that they are not in contact."

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Flight 188 pilot denies he was asleep

Posted at 7:20 PM on October 23, 2009 by Bob Collins (0 Comments)
Filed under: Northwest Airlines

ABC News has the "exclusive" interview -- short as it was -- with one of the pilots of Northwest Flight 188.

"I can assure you none of us was asleep," First Officer Richard I. Cole told ABC News.

That was pretty much it.

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The 'what if' scenario

Posted at 7:22 PM on October 23, 2009 by Bob Collins (0 Comments)
Filed under: Northwest Airlines

Following up on my extensive napkin-calculations of earlier today (See, "Making it Add Up"), I was invited on MPR's All Things Considered on Friday evening to put some context to the larger question of Flight 188 as the first major test of the U.S. ability to protect American cities from the possibility of another attack by commercial jetliner.

This was the first significant test of a revamped air defense structure since 9/11. We failed.

Here it is:



After this discussion, I got this interesting message from a reader/listener:

It doesn't make a huge difference, but the speed estimates that you gave for the F16 seem to be a little bit on the low end. While the pilots you have spoken to may not have flown faster than 800 mph or so, by the book the F16 should cruise around 500 MPH and top out at over 1200 MPH in a hurry for any of the engine variants. This changes your estimated Madison-Minneapolis time to about 10 minutes.

I didn't use the sender's name because I don't have his position but he's right, an F-16 can fly as fast as about 1300. I deliberately used more conservative numbers because a jet flying at 1300 doesn't have a lot of fuel left to fly around with an Airbus and because I thought it best to be conservative when questioning the timetable of the NORAD spokesman.

But, for the heck of it, let's assume the fighters were 10 minutes from here and they waited until the last possible minute to launch -- which, of course, they did. That means they could've launched as late as 7:54 to arrive here at 8:04. At 8:04, the plane was directly over the Mississippi River, just south of the Lake Street bridge.

The point remains the same: By waiting as long as they did, NORAD (or the FAA) assured that if it had been hijacked by terrorists intent on harming the Twin Cities, the jets were not in a position -- for whatever reason -- to get into a position to stop it.

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Sleeping seen as more likely explanation for Flight 188

Posted at 3:47 PM on October 23, 2009 by Bob Collins (3 Comments)
Filed under: Northwest Airlines

A glance around the land of the talking heads reveals few people who think the pilots of Northwest 188 were anything but asleep on Wednesday, when they flew 150 miles past Minneapolis St. Paul.

CNN's John Roberts, though, gets some sort of award for wasted airtime for asking the former managing director of the National Transportation Safety Board, "how dangerous is it if both pilots are asleep?"

The Atlantic's James Fallows also figures they were asleep:

To avoid being coy about my "hypothesis," it's hard to imagine how this could have happened if the pilots were awake. There is too much going on in the last 45 minutes of a flight -- with procedures for arrival, approach, and landing, many checklists -- just to be "distracted." So most likely either they both fell asleep in the normal sense or, weirdly, were both disabled in a way they then recovered from.

Jeff Skiles, the Wisconsin man who was the first officer on the plane that made the famous emergency landing in the Hudson River, said pilots can work up to 16 hours a day. "Truck drivers have more restrictive rules than we do," he told WNYC's The Takeaway. Skiles added another frightening observation -- airliners don't usually carry enough extra fuel for a 300 mile diversion, as this jet obviously did.

Indeed, everyone's got an opinion -- except for the White House. ""I'm not going to speculate on any of that," Deputy Press Secretary Bill Burton told reporters today. "I will just point you towards the FAA and the TSA." The Christian Science Monitor is incredulous.

Burton's got to be about the only one who isn't talking about it. Of course, early in a story (especially if it's embarrassing), the White House is going to do exactly this - throw the questions over to an agency.

Besides, this isn't like when pilots on Air Force One scared half of New York when the White House Military Office decided they should divebomb Manhattan - without alerting the public - for a photo op last May.

This is entirely different. Still terrifying, but the White House had nothing to do with it (even Joe Biden).

Meanwhile, the pilots have been identified. Richard Cole, whose residence is Salem, Oregon, was the first officer. If the address is correct, it might lend some credence to the "sleeping" theory since Salem would require some commuting. Salem is more than 200 miles from Northwest's Seattle hub. But Northwest's pilot bases are Anchorage; Detroit; Honolulu; Memphis, Tenn.; Minneapolis/St. Paul.

The pilot was Tim Cheney of Gig Harbor, Washington.

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Flight 188: Making it add up

Posted at 11:22 AM on October 23, 2009 by Bob Collins (29 Comments)
Filed under: Northwest Airlines

In the aftermath of the wayward Northwest Flight 188, the initial pilots' stories aren't the only ones that don't add up. Another is the reasons given for not intercepting the plane as a potential terrorist threat.

By now you've probably seen the terse press release from the North American Air Defense Command explaining its role:

PETERSON AIR FORCE BASE, Colo. - Fighters from two North American Aerospace Defense Command sites were put on alert yesterday for a Northwest Airlines commercial airliner that was not responding to radio calls from the Federal Aviation Administration. Before the fighters could get airborne, FAA re-established communications with the pilots of the Northwest Airlines commercial airliner and subsequently, the NORAD fighters were ordered to stand down. NORAD does not discuss locations of alerts sites. No further information will be provided as the National Transportation Safety Board is continuing its investigation.

NORAD is the bi-national Canadian and American command that is responsible for the air defense of North America and maritime warning. The command has three subordinate regional headquarters: the Alaskan NORAD Region at Elmendorf Air Force Base, Alaska; the Canadian NORAD Region at Winnipeg, Manitoba; and the Continental NORAD Region at Tyndall Air Force Base, Fla. The command is poised to provide a multilayered defense to detect, deter and prevent potential threats from flying over the airspace of the United States and Canada.

NORAD's mission is carried out in close collaboration with homeland defense, security, and law enforcement partners.

Like so many other elements of the story, things don't add up.

A silent jetliner is heading toward a major American city and the military didn't intercept it. Why not? The threat the situation posed was demonstrated clearly on 9/11.

"Before the fighters could get airborne, FAA re-established communications with the pilots of the Northwest Airlines commercial airliner and subsequently."

Based on the facts that have been released, this sentence in the press release suggests there was a significant delay in the time between the FAA knew the plane was in an uncertain situation, and the time it took for the military to be informed and/or respond.

According to officials, the plane stopped talking to controllers while it was over Kansas. The plane's flight path, however, only took it over a sliver of Kansas, specifically over Goodland, Kansas. The plane was over Goodland at 7:03 p.m. on Wednesday evening, while it was still under the direction of air traffic controllers in Colorado.

According to the plane's flight record, it did not change its flight path until 8:15 p.m., when we can safely assume the pilots either (a) stopped fighting with each other or (b) woke up and realized what was happening.

The fact that NORAD says the flight wasn't intercepted because by the time fighter jets could be launched, Minneapolis controllers re-established contact, invites us to see when the jets could have intercepted the airliner.

NORAD won't say where the fighters were stationed that were "on alert," but it's not hard to figure out. Madison has the most active Air National Guard base in the Upper Midwest. Indeed, CNN confirms that Madison was the base on alert.

Goodland, Kansas, is 600 miles by air. The jet didn't pass over Minneapolis St. Paul until 7:53 p.m. -- 50 minutes after it "went dark." The 115th Fighter Wing in Madison flies F-16 jets. F-16s fly about 300 knots per hour in cruise, but can fly much faster when they've got a good reason to. F-16 pilots I've talked to say the fastest they've gone is in the vicinity of 800 knots, so let's just say with an American city under a possible threat, they'd got about 700 knots -- that's 805 mph.

Madison is 198 miles from Minneapolis St. Paul or about 15 minutes for an F-16 in a hurry. If the military wanted to intercept a threat before it reached Minneapolis St. Paul, the area around Redwood Falls would've been the place to do it. That's 20 minutes away for an "on alert" F-16 in Madison.

To have been able to do that, the order to intercept would've had to have been given by 7:34 p.m., or almost a half hour after the plane "went dark." That obviously didn't happen. The military either didn't know about a plane that had been flying without being in contact for a half an hour, or they did know about it and the decision was made not to intercept the possible threat. We don't know; nobody's talking.

"I've told you more than I needed to," Keith Holloway of the National Transportation Safety Board told MPR's Marty Moylan today after telling him, well, nothing.

Taking NORAD's press release at face value, there's still the question of why the planes weren't in the air at all. Let's assume it's one minute before contact was re-established (i.e. 8:14 p.m.). That still means that an hour and 13 minutes after a jetliner stopped communicating with the ground controllers, the military still had not taken steps to intercept it.

It's true, however, that the plane's altitude hadn't changed over that time, indicating no apparent threat, but if it had been under the control of hijackers, waiting until it did to launch jets to intercept it would've been -- like 9/11 -- far too little and far too late.

In a statement today, the Transportation Security Administration provided little insight into a simple question:

TSA was aware of and monitored the situation working with our federal and stakeholder partners. As part of our procedures for events of this nature, TSA protocol included checking possible screening anomalies from the departing airport, checking to see if Federal Air Marshals were onboard, notification to the airline, as well as TSA and DHS leadership. TSA also participated in briefing conference calls with other federal partners and continued to monitor the situation.

Coincidentally, an aircraft was intercepted by fighter jets on Wednesday. The pilot of a small plane stopped communicating (it turns out, he was likely dead or incapacitated) over Indiana and fighter jets followed it until it crashed. (Update: This is incorrect. There was an interception of a plane in Indiana, but it was on September 30, not the same day as Flight 188.)

In Minnesota, of course, everything turned out fine. But what if it hadn't? What questions would we be asking today?

MPR's Marty Moylan is asking some of them. Look for his report tonight on MPR's All Things Considered.

WHAT ELSE DOESN'T ADD UP?

The "they fell asleep" story is one that is being driven by the union, but so far it's not substantiated by any of the facts in the case.

Let's assume the pilots fell asleep. First, there were only two flights into San Diego on Wednesday that the pilots could've been on. One was a 9 a.m. flight out of Memphis, the other was a 9 a.m. flight out of Minneapolis St. Paul. If they weren't flying (or "deadheading") either of those, then they likely spent the night in San Diego.

If they did fall asleep over Kansas, and they did fly the morning flights and turn around and fly Flight 188, they fell asleep less than 12 hours after their workday started -- and they fell asleep at the same time. That's not ideal as far as working conditions go, but it's not unusually harsh, either.

And, finally, if they did fall asleep -- and if the FAA is accurately portraying their original story about a heated discussion -- that means the pilots concocted a pretty bizarre story to cover for another pretty bizarre story, and it means they lied to federal investigators, which will get you charged with a felony in a hurry.

IS CREW REST AN ISSUE?

Crew rest is always an issue, even if these pilots didn't fall asleep. Current rules call for 8 hours "rest" but what constitutes "rest"? To the airlines, if it takes a pilot 1/2 an hour to get to the airport, that's included as 'rest." Legislation that's been filed seeks to change that definition.

WILL THE COCKPIT VOICE RECORDER TELL INVESTIGATORS MUCH?

It's not likely. Most CVRs record only 30 minutes. Possibly not. The airlines are only required to record the last 30 minutes of cockpit conversation. (They can record up to 2 hours as a commenter noted below). The plane landed around 9:05. Figure another 10 minutes to taxi in, and shut down and it's 9:15. The first indication the pilots started flying the airliner again was around 8:47. In other words, there's not likely to be either a lot of shouting or a lot of snoring on the tape. Conspiracy theorists will have a field day with that factoid.

SHOULDN'T THE PILOTS HAVE SEEN THE LIGHTS OF MINNEAPOLIS ST. PAUL

That's what a story from the Associated Press (written from Washington) seems to say, but there's a flaw. The weather. At the time the plane few over the Twin Cities, the weather observations said there was an overcast layer of clouds at 800 feet above the ground.

Update 6:10 p.m. After my conversation with Tom Crann on All Things Considered tonight, I got this interesting message from a reader/listener:

It doesn't make a huge difference, but the speed estimates that you gave for the F16 seem to be a little bit on the low end. While the pilots you have spoken to may not have flown faster than 800 mph or so, by the book the F16 should cruise around 500 MPH and top out at over 1200 MPH in a hurry for any of the engine variants. This changes your estimated Madison-Minneapolis time to about 10 minutes.

I didn't use the sender's name because I don't have his position but he's right, an F-16 can fly as fast as about 1300. I deliberately used more conservative numbers because a jet flying at 1300 doesn't have a lot of fuel left to fly around with an Airbus and because I thought it best to be conservative when questioning the timetable of the NORAD spokesman.

But, for the heck of it, let's assume the fighters were 10 minutes from here and they waited until the last possible minute to launch -- which, of course, they did. That means they could've launched as late as 7:54 to arrive here at 8:04. At 8:04, the plane was directly over the Mississippi River, just south of the Lake Street bridge.

The point remains the same: By waiting as long as they did, NORAD (or the FAA) assured that if it had been hijacked by terrorists intent on harming the Twin Cities, the jets were not in a position -- for whatever reason -- to get into a position to stop it.

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Tales from the flight deck

Posted at 2:19 PM on October 22, 2009 by Bob Collins (37 Comments)
Filed under: Northwest Airlines

Note: This post has been updated to include an interview with a passenger.



This has not been a particularly good week for the public image of the nation's airline pilots. Earlier this week, a Delta 767 landed on a taxiway in Atlanta instead of a runway.

And a few moments ago, the National Transportation Safety Board issued a news release detailing a puzzling lapse by a Northwest Airlines flight crew over Minneapolis yesterday:

On Wednesday, October 21, 2009, at 5:56 pm mountain daylight time, an Airbus A320, N03274, operating as Northwest Airlines (NWA) flight 188, became a NORDO (no radio communications) flight at 37,000 feet.

The flight was operating as a Part 121 flight from San Diego International Airport, San Diego, California (SAN) to MSP with 147 passengers and unknown number of crew.

At 7:58 pm central daylight time (CDT), the aircraft flew over the destination airport and continued northeast for approximately 150 miles. The MSP center controller reestablished communications with the crew at 8:14 pm and reportedly stated that the crew had become distracted and had overflown MSP, and requested to return to MSP.

According to the Federal Administration (FAA) the crew was interviewed by the FBI and airport police. The crew stated they were in a heated discussion over airline policy and they lost situational awareness. The Safety Board is scheduling an interview with the crew.

The cockpit voice recorder (CVR) and flight data recorder (FDR) have been secured and are being sent to the NTSB laboratory in Washington, DC.

The plane landed around 9:15 last evening, more than an hour late. The pilot was all business by the time he called the tower for permission to land (liveATC.com):



There are so many obvious safety violations here, it's hard to know where to start. But the biggest one is the lapse in what safety experts call "cockpit resource management." ideally, CRM is when the captain and first officer are working as a team to ensure the safe conclusion of a flight.

When a flight crew is having a "heated argument" that they miss their intended airport and keep flying, well, you're looking at the end of a couple of airline careers.

Let's review a few items from the Wayback Machine: Even a cockpit full of drunken pilots was able to hold it together and find the airport.

Here's what happens when there's a lack of proper crew resource management.

There are other questions, too, obviously. For example, if a airliner full of people suddenly goes silent, did any military jets scramble to intercept it? And if not, why not?

If you want to watch this play out on a forum for airline pilots, go here.

Update 5:01 p.m. - Bach Parker of St. Louis Park was on the flight. He was returning from a business trip to San Diego. Listen to the entire interview. He describes the scene as passengers were disembarking, noting that a case was removed from the cockpit and several "dark suits" were standing by.



Update 6:19 p.m. - On the question of whether there was a Department of Homeland Security response, this reply (by e-mail) from Kristin Lee, the assistant administrator in the Office of Strategic Communications & Public Affairs Transportation Security Administration:

TSA's Transportation Security Operations Center was aware of the issue and worked with our federal partners to monitor the situation.

Another good reminder to me that when you're talking to the federal government, be very specific about what you want to know, such as "did you scramble any jets to intercept the aircraft?"

Update 6:36 p.m. The Associated Press reports:

The FAA notified the military, which put Air National Guard fighter jets on alert at two locations. As many as four planes could have been scrambled, but none ever took to the air. "After FAA re-established communications, we pulled off," said Michael Kucharek, a North American Aerospace Defense Command spokesman.

Update 8:22 a.m. 10/23 - Here's my appearance with Cathy Wurzer on MPR's Morning Edition:

(h/t: Than Tibbetts, Ryan Mathre)

(Image: This is the radar track for the flight)

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Mesaba faulted in stranding of ExpressJet passengers

Posted at 11:20 AM on August 21, 2009 by Bob Collins (21 Comments)
Filed under: Northwest Airlines

The U.S. Department of Transportation today said it wasn't the fault of the crew of that ExpressJet flight that sat on the ramp in Rochester for hours a couple of weeks ago. It was the fault of a crew from Mesaba Airlines.

Secretary of Transportation Ray LaHood, writing on his blog today, said his preliminary investigation has found:

• *** The local representative of Mesaba Airlines--the only carrier in a position to help the stranded plane--improperly refused the requests of the ExpressJet captain to let her passengers off the plane, telling the captain that the airport was closed to passengers for security reasons.
  
  This is what led to the nightmare for those stuck on the plane.
  
  The Mesaba rep said this apparently because there was no one from the Transportation Security Administration (TSA) available to screen passengers. But, in fact, TSA procedures allow passengers to get off the plane, enter the terminal and re-board without being screened again as long as they remain in a secure area.
  
  *** While the crew of the Continental Express flight did what they could to assist passengers, more senior personnel within Continental or ExpressJet should have become involved in an effort to obtain permission to take the passengers off the plane.

The plane left Houston at 9:23 p.m. on August 11, but was diverted by thunderstorms to Rochester. Passengers were kept for about six hours waiting inside the cramped plane amid wailing babies and a smelly toilet even though they were only 50 yards from a terminal, the Associated Press reported.

The Associated Press, meanwhile, has obtained recordings of the ExpressJet's flight crew conversation with its corporate headquarters. ExpressJet has also provided this timeline of the flight.

Here's the audio with some annotations I've made:



(h/t: Brian Bakst, AP)

Update 2:39 p.m. - Delta CEO Richard Anderson's reaction (Delta owns Mesaba)

"Because customer service is so important to our industry, I have personally reached out to Continental's chairman and CEO to ensure we fully understand the facts of this unfortunate incident. Delta is working with Mesaba to conduct an internal investigation, continue our full cooperation with the DOT and share all the facts with Continental."

Update 2:51 p.m. - Mesaba Airlines Chief Executive Officer John Spanjers' statement:

"Mesaba respectfully disagrees with the DOT's preliminary findings as they are incongruent with our initial internal review of the incident. Because Continental Express Flight 2816 diverted to an airport where they have no ground handling service, Mesaba offered assistance as a courtesy during this delay. While the investigation is ongoing, Mesaba is fully cooperating with the Department of Transportation and looks forward to the final report."

Update 2:57 p.m. - Transportation Security Administration (TSA) isn't talking, but noted this posting on its Web site:

Airlines, not TSA, make the decision on whether or not to deplane passengers if there is a delay or diversion. TSA does not prohibit airlines deplaning passengers and re-boarding without screening as long as they don't exit past the checkpoint and leave the secure area, regardless of whether or not TSA officers are conducting screening operations. In addition, TSA has the ability to recall security officers and resume screening passengers after hours at the request of an airline or airport.

It's important to remember, this is one side of the story.

Update 7:04 p.m. Here's my interview on MPR's All Things Considered:

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The Airbus problem

Posted at 12:36 PM on August 7, 2009 by Bob Collins (7 Comments)
Filed under: Northwest Airlines

The number of U.S. airliners (Airbus 330s) with malfunctioning speed systems is up to 12, the Associated Press reports today. All of them involve Airbus jets operated by Northwest Airlines.

Transportation officials are investigating a series of similar malfunctions. The recent discovery was described by people close to that investigation who spoke on condition of anonymity because they were not authorized to speak publicly.

If pilots don't know how fast they're flying -- and apparently the pilots on these flights didn't -- there's a chance the jets could break apart by exceeding their structural limits. That is believed to have been a possible contributor to the Air France crash off the coast of Brazil in June.

Northwest and US Airways are the only (U.S.) airlines operating Airbus (330) jets.

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Airline fees

Posted at 1:41 PM on July 21, 2009 by Bob Collins (2 Comments)
Filed under: Northwest Airlines

The cost of checking your bags is going up.

Delta has apparently joined the move this week to raise the price of checked baggage by $5 per bag.

A note on the company's Web site says:

For tickets purchased on or after July 16, 2009 for travel on or after August 4, 2009 there will be a $5 surcharge on each of the first two checked bags when checking in via ticket counter, kiosk, or curbside. There is no surcharge for bags prepaid during online check-in at delta.com.

That would increase the fees to $20 for the first bag, $30 for the second.

American is the only major airline that -- so far -- hasn't joined in on the baggage fee increase.

Meanwhile, a lawsuit in Nevada is alleging the airlines colluded to raise the fees since their inception during the high point in the spike of jet fuel.

Discussion point: Have you changed your flying habits since the airlines started charging for baggage? Anecdotally, I noticed during a trip to the airport a couple of weeks ago that there was a lot less baggage on the carousels, indicating that people are packing lighter or jamming more stuff into carry-on.

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The shrinking hub

Posted at 4:01 PM on July 7, 2009 by Bob Collins (2 Comments)
Filed under: Northwest Airlines

When Delta and Northwest Airlines announced their merger, then Northwest boss Doug Steenland said Delta's hub in Cincinnati and Northwest's hub in Memphis would be kept intact. "We have the right size of operation to make Memphis profitable" he said in April 2008. All of the hubs have a "very secure future."

Some people thought that assurance was made for political reasons. No sense upsetting a congressman or senator who could raise anti-trust objections. But Steenland insisted the statement wasn't about politics.

Memphis has seen its traffic grow but it looks like Cincinnati is becoming a hub in name only, according to some numbers-crunching by The Cranky Flier.

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Delta after Northwest

Posted at 3:23 PM on June 8, 2009 by Bob Collins (5 Comments)
Filed under: Northwest Airlines

Have you flown on Delta/Northwest lately and noticed any changes since the Atlanta-based airline took over the formerly Minnesota-based Northwest?

The Cranky Flier blog has. Movies, snacks, lots of changes in scheduled flights, and better service, he says in a post today.

What are your experiences since Delta took over?

(Photo: KAREN BLEIER/AFP/Getty Images)

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The Southwest Effect

Posted at 5:38 AM on March 4, 2009 by Bob Collins (6 Comments)
Filed under: Northwest Airlines

The runway at Minneapolis St. Paul International Airport is littered with the carcasses of airlines that thought they could compete for a little slice of Northwest Airlines' pie. Nobody can drive a competitor out of its home turf better than Northwest. But one gets the sense that this time, it's different. For one thing, Minneapolis St. Paul isn't the home turf for Northwest anymore; Atlanta is.

Southwest Airlines is starting service to the Twin Cities on Sunday and -- unlike many of the dearly departed upstarts -- people have actually heard of them.

What's more, aside from the fact it knows how to undercut airfares -- and not charge for checked baggage -- it also knows how to market itself. In fact, it may be the best-marketed airline in the country in addition to being one of the few that actually makes money.

Case in point: On Saturday, Southwest is holding a "tweet up" (a mixer) at The Newsroom on Nicollet Mall. The airline uses Twitter to communicate -- almost as if it's a human (It actually is a human, of course. It's Southwest employee Christi Day.) It's got 65,000 "fans" on Facebook, where it dominates the social networking scene for airlines by answering individual questions.

The airline is all about irreverence. Sometimes it works; sometimes it doesn't. A jet with a swimsuit model painted on it (photo) has been its latest controversy, dubbed the "porno plane."

Will an aggressive marketing strategy allow Southwest to compete head to head with Northwest after the hubbub of its arrival fades? After all, remember Krispy Kreme doughnuts?

People have been bad-mouthing Northwest for years, then sticking with the carrier even when a competitor moved into town. And if Northwest matches Southwest fares, which they've indicated they will, will they keep the customers who are loyal to their WorldPerks frequent flyer miles program?

On the first hour of MPR's Midday this morning, Gary Eichten will explore "the Southwest Effect." Will it make a difference to you?

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Airline on-time performance

Posted at 10:56 AM on February 10, 2009 by Bob Collins (2 Comments)
Filed under: Northwest Airlines

What can be made of airline claims about on-time performance?

"Hawaiian is Nation's Most On-Time Airline for 5th Straight Year," a press release announced yesterday. "Airline Leaps from Worst to First among the 'Big Six' Hub-and-Spoke Carriers," said the release from US Airways.

In that spirit, we can confidently announce that Northwest Airlines was the nation's top on-time airline among airlines with a hub in Minneapolis and owned by an airline in Atlanta.

These are based on the Department of Transportation performance statistics for December.

For Minneapolis-St. Paul, we learn that:

Northwest's flights were on time only about 65% of the time. That's good for 10th place among the rated airlines.

Northwest's on-time performance at MSP was better than most other airlines, though none of it was much to write home about.

The hour during which the most flights arrive on time at MSP is between 6 and 7 a.m. (68.6%). The hour during which the most flights arrive late at MSP is between 10and 11 p.m. (45.1%)

The highest percentage of departing flight delays is 9-10 p.m. The best hour is 7-8 a.m. to depart.

Northwest flight 599 -- Minneapolis to Portland, Oregon runs late 93 percent of the time. The average delay is about an hour and a half. It was the second-worst on-time performance in the country. Only AmericaWest's flight from Atlanta to San Antonio is worse.

Of all airlines at Minneapolis-St. Paul, flights arrived late 62.3 percent of the time, and departed late 67.9 percent of the time.

Northwest canceled the fewest number of flights of any major airline.

December's biggest headache was, no doubt, shared by passengers of Express Jet flight 2418 at George Bush Airport in Houston, who had a 7-hour tarmac delay. It snowed in Houston that day.

Southwest Airlines, which starts flying at MSP next month, had the fewest rate of passenger complaints. United was the worst.

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How Delta rolls

Posted at 2:18 PM on January 24, 2009 by Bob Collins (1 Comments)
Filed under: Northwest Airlines

In an article to be published in Sunday's Atlanta Journal Constitution, two reporters look at a threat Delta Airlines has made to move traffic out of its giant Atlanta hub.

The newspaper says Delta threatened to move flights -- and jobs -- out of Atlanta in a dispute with the agency that manages the airport there. Delta is trying to replace a 30-year master lease that expires next year.

Most of the "experts" surveyed said it's a bluff. But who wants to call the airline on a bluff? Not officials in Minnesota, who have been looking at a reworked agreement between Delta, which has taken over Northwest Airlines, and the Metropolitan Airports Commission. MAC meets Monday to consider the deal to rework payment of bonds to Northwest.

Last week, legislators at the Capitol were briefed on the deal, in which Delta agrees to keep 10,000 jobs in Minnesota through the middle of the next decade.

Many legislators don't like the agreement, but there's not much to be done about it. Earlier this month, threatened with being held to a timetable to repay the bonds if it closed Northwest's headquarters in the state, Delta CEO Richard Anderson made a threat that wasn't very veiled. According to a Star Tribune report:

"We could easily pay back the $245 million note to the bondholders and not make any firm [legal] commitments" in Minnesota, Delta CEO Richard Anderson said in a Thursday message to employees. But he added that "we're committed to Minnesota, we're committed to the Minneapolis hub," so Anderson said he wants the MAC agreement to be approved at the Jan. 26 commission meeting.

It will be.

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Erasing history

Posted at 9:55 AM on January 15, 2009 by Bob Collins (3 Comments)
Filed under: Northwest Airlines

Tucked within Delta's Airline's Web site is this video with a time-lapse look at the end of the red tails of Northwest Airlines.

In short order, it'll be almost like they were never here.

BTW, it takes 12 days to paint a 747.

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Airline fees

Posted at 10:50 AM on January 12, 2009 by Bob Collins (0 Comments)
Filed under: Northwest Airlines

If you don't like the fees airlines are charging for checked baggage, you have nobody to blame but yourself, at least one airline spokesperson suggests.

Dan Webb, who writes the blog Things in the Sky, asked several airlines why they're still charging for checked baggage (a fee that was ostensibly going to offset the spike in fuel prices) now that the cost of fuel has dropped.

He found the response from Continental to be "interesting."

"While we initially tried to avoid baggage fees, the fact is that the consumer gave no preference to airlines not charging them. In order to maintain an even footing with other airlines from a revenue standpoint, the baggage fee became a necessary competitive response."

Passengers may not like the baggage fees, but they're more than willing to pay them. Of course, in many markets, the flying public doesn't have the choice. In the Twin Cities, for example, Northwest/Delta and Sun Country both charge a fee.

The great experiment will begin in a few months, however, when Southwest Airlines flies into town. The airline doesn't charge a fee for checked baggage.

When the fees were announced, a lot of people thought it would make the carry-on situation a nightmare. But apparently that hasn't happened.

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Is Northwest Airlines still a local story?

Posted at 8:47 PM on December 19, 2008 by Bob Collins (2 Comments)
Filed under: Northwest Airlines

Here's a question I've been noodling on. When do we stop caring about Northwest Airlines as a local story? When it was a hometown airline, it was obvious to most of us, I think, why we needed to concentrate on it. It was one of us. But now it's a part of an airline based in Atlanta, we're another stop on its thousands of destinations. We're a busy Cincinnati.

So do we still care what its CEO thinks? Is that still a story with a "local angle"?

If Richard Anderson, former Northwest chairman (and MPR board member) and now Delta CEO, goes on TV and talks about how great bankruptcy was for his airline(s) and is asked whether it'd be just as fabulous for the auto industry, do we care?

By the way, there was an event today that further solidified the end of the Northwest brand. The first Delta-emblazoned 747 took off from Minneapolis-St. Paul today, bound for Japan.

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Delta has Minnesota over a hub

Posted at 9:00 AM on November 14, 2008 by Bob Collins (2 Comments)
Filed under: Northwest Airlines

Though we don't technically have a hometown airline anymore now that Delta has absorbed Northwest, the Atlanta-based airline still provides a fair amount of economic activity for Minnesota. And doesn't it know it. Less than a month after Delta officials pledged to keep its Twin Cities hub, the company has made it clear there's a significant maybe involved.

Thursday's hearing at the Capitol was an exercise in veiled threats, centered around state-backed debt for Northwest, given years ago in exchange for a promise to keep the headquarters here.

Lawmakers don't have a lot of clout in preventing Delta from closing Northwest's Eagan headquarters, and former-Northwest-now-Delta official Ben Hirst got that point across pretty clearly without exactly saying so.

The legislators stressed that a deal is a deal.

Hirst's response:

"To the extent that the Minneapolis airport has higher costs per enplanement than Cincinnati or Detroit or other competing airports in the Delta system, then all that happens there is that Delta has an incentive to locate flights through those airports rather than here."

Translation: Push us, and we'll close your hub.

Rep. Debra Hilstrom said Delta can't just say they're not going to honor the deal. To which Hirst replied the company would, if pushed, just write a check for what's owed, adding:

"In uncertain times, liquidity means security for our company and for our people, so we would prefer to leave the bonds in place," Hirst said.

Translation: If you push us to early repayment, we'd have less cash and we may have to close your hub.

That sent Rep. Ann Lenczewski on a new tack: repealing tax breaks Delta-Northwest gets.

Hirst's response as quoted by Session Weekly:

Such actions could result in increased employment costs at the airport, which could force Delta to scale back its operations even further.

Translation: Fine. We'll close your hub.

Oh, and about those taxes. Metropolitan Airports Commission spokesman Pat Hogan sent an e-mail today noting that the airlines pay them:

Airlines and other businesses at MSP DO pay property taxes. (I believe a look at the Hennepin County tax rolls will show that NWA pays millions in property taxes for its airport facilities.) What MSP tenants do not pay is the Statewide Commercial/Industrial tax. That tax was established to fund education. MSP is not in any city nor does it contain any residences that might use area schools, so the Legislature determined airport tenants should not be subject to that particular tax. Utilities, fire and polic protection are provided by the MAC, and airport tenants cover those costs through rent payments and other charges.

(I'm looking for Northwest employees who are in "limbo," who don't know whether they'll be in Minnesota or Georgia. Please contact me.)

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Airline sausage

Posted at 7:11 AM on November 11, 2008 by Bob Collins (1 Comments)
Filed under: Northwest Airlines

Two stories out today reveal just how messy the Delta takeover of Northwest Airlines is going to be.

Locally, Delta is making noises with the Metropolitan Airports Commission that the MAC needs to start renegotiating the deal the state gave the former-hometown airline (Northwest) in exchange for agreements to keep a headquarters here. The "new" Delta is headquartered where the "old" Delta was -- Atlanta. MAC officials say they've been trying to get Delta to offer a proposal for months. The subtext? A face-off.

Stuck in the middle? The people who don't know whether they'll be working here or in Atlanta.

Now that the happy faces of the takeover from a couple of weeks ago have faded, we get to see the ugly side of merging two companies with vastly different cultures and unions.

The pilots are workforce is heavily unionized at Northwest; not so at Delta. That could change with a filing, reported today by the Atlanta Constitution, by pilots that seeks a determination that Northwest and Delta are now one carrier. That would create a single bargaining unit for the pilots.

But the machinists' union isn't happy. It wants the two carriers considered separate airlines for now, and fears a single airline would allow Delta to get rid of the machinists' union before employees have had a chance to get themselves organized.

If the National Mediation Board determines that Delta and Northwest are a single carrier across the company, as Delta contends, unions would have 14 days to show interest from at least 35 percent of employees in a craft or class to trigger union representation elections. Northwest is highly unionized, but at Delta, pilots were the only major unionized group.

The International Association of Machinists wants the carriers considered as separate for now, which preserves the existing unionized groups.

By the way, I'm looking for readers who now work for Delta, who are in "limbo" because of the still-undecided elements of the merger. Contact me via this form.

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Will Southwest Airlines make a difference?

Posted at 8:46 AM on November 6, 2008 by Bob Collins (3 Comments)
Filed under: Northwest Airlines

Southwest Airlines officials are holding a news conference this morning to announce the details of their entry into the Minneapolis St. Paul market. Included will be details on fares for the airline's long Twin Cities-to-Midway(Chicago) route.

This is a route News Cut has been tracking since last winter when a competitor -- AirTran -- dropped the route. At the time, the round-trip fair was $114.

With presently no significant competition, Northwest is now charging $634 for a late November flight with a Saturday-night stayover. It's $661 with the taxes and that doesn't include the baggage fees, which Delta has now adopted.

Cracking the MSP market has always been hard; not just because Northwest has so many more flights, but because Northwest was "us." It was a hometown airline. Now that it's an Atlanta airline, it'll be an interesting experiment to see if local passengers have any loyalty to the soon-to-be-wiped-out Northwest brand.

Southwest will enter the local market in March.

We'll update the post after the news conference.

Update 10:55 a.m. From fareccompare.com and USA Today:

"We are likely to be in for some serious fireworks on prices out of Minneapolis in the coming days for Spring travel" Seaney wrote on his blog. He said the new Southwest route from Minneapolis to Chicago is priced at $69 one-way with a 21-day advance purchase.

He wrote that the cheapest fare on that route for Northwest, American and United is $426 one-way. They offer round trips for $376, which works out to $188 each way.

"The legacy airlines will quickly have to restructure their airfares, by offering one-way fares instead of the two-night minimum stay roundtrip fares they currently file _ likely matching Southwest's new price points," Seaney wrote.

Update 11:07 a.m. Here's the Southwest press release:

Southwest Airlines today announced the carrier's low fares and flight schedule from Minneapolis-St. Paul beginning on March 8, 2009. During a media conference at the landmark Mall of America, Southwest Airlines Executive Vice President of Corporate Services Ron Ricks announced that the airline will begin service with eight daily nonstop flights to Chicago Midway with 21-day advanced purchase fares as low as $69 one-way. To view a complete list of Southwest's flights from MSP, visit: http://www.southwest.com/?src=PRPRPRNGENR000000080808.

"Southwest Airlines is famous for increasing traffic and decreasing fares when we enter a market, and it already appears that 'the Southwest Effect' is alive and well in Minneapolis-St. Paul," Ricks said. "The people of Minnesota have been asking for Southwest Airlines service for many years, and we can't wait to introduce them to our legendary Customer Service, as well as our low fares, ontime flights, and no hidden fees."

In addition to the eight daily nonstop flights to Chicago Midway, Southwest Airlines will offer direct or connecting service to more than 30 destinations, including: Las Vegas, Denver, Los Angeles, Houston, and Baltimore/Washington, just to name a few. Southwest Airlines will operate from Gate 7 in the Humphrey Terminal and will have about 35 full-time Employees.

"For over a decade we've worked diligently to attract Southwest Airlines to the Minneapolis-St. Paul Airport," said Metropolitan Airport Commission Chairman Jack Lanners. "Southwest's new service beginning March 8, 2009 will provide Minnesotans a low-cost alternative accessing the Southwest Airlines route system. For many years there has been a strong interest in having Southwest Airlines serve our community. Our airport's low-cost operating structure is one factor that helped make it possible for Southwest to enter the Minnesota market. We look forward to a successful partnership with Southwest Airlines providing new low-cost air service meeting our travel needs."

To view a blog post on this news, visit: http://www.blogsouthwest.com.

After 37 years of service, Southwest Airlines, the nation's leading low-fare carrier, continues to stand above other airlines -- offering a reliable product with exemplary Customer Service with no hidden fees. Southwest Airlines is the most productive airline in the sky and offers Customers a comfortable traveling experience with all premium leather seats and plenty of legroom. Southwest recently updated its gate areas and improved its boarding procedure to make flying Southwest Airlines even more convenient. Southwest Airlines (NYSE: LUV), the nation's largest carrier in terms of domestic passengers enplaned, currently serves 64 cities in 32 states. Based in Dallas, Southwest currently operates more than 3,400 flights a day and has more than 34,000 Employees systemwide.

Fare Rules

The $69 fare between Chicago Midway and Minneapolis-St. Paul is available for purchase today through the end of the schedule, currently May 8, 2009. Fares are one-way and do not require an overnight stay. All tickets must be purchased 21-days in advance. When combining fares, all ticketing restrictions apply. Seats are limited. Fares may vary by day of travel and will not be available on some flights that operate during very busy travel times and holiday periods. Fares do not include a federal segment tax of up to $3.60 per takeoff and landing. Fares do not include airport-assessed passenger facility charges (PFC) of up to $4.50 one-way and U.S. government- imposed September 11th Security Fees of $2.50 one-way. Fares are subject to change until ticketed. Tickets are nonrefundable but, if unused, may be applied toward the purchase of future travel on Southwest Airlines. Fares are valid on Southwest-operated published, scheduled service only and are not available through the Group Desk.

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Farewell, Northwest

Posted at 8:12 PM on October 29, 2008 by Bob Collins (2 Comments)
Filed under: Northwest Airlines

Delta got Justice Department approval on Wednesday to take over Northwest Airlines. And the bosses of Northwest sent these final letters out to the employees:

Doug Steenland

Today, we finalized our merger transaction with Delta, creating the world's premier global airline. With the closing of this transaction, the merged airline - including its employees, customers and the communities it serves - will be best positioned to be a strong competitor and to master the challenges that the airline industry will continue to face.

When you come to work tomorrow, you will be employees of NWA, Inc. - a wholly-owned subsidiary of Delta Air Lines. The name Northwest Airlines, and our signature Red Tail, will begin to transition away. But the spirit of our Company - our "can do" attitude, our resourcefulness, our commitment to operational excellence, and our culture of innovation, will live on in the new Delta.

I am confident that as the best of the "Red" and the best of the "Blue" blend together, the 75,000 employees of the new Delta will create the biggest and best airline in the world.

It has been a pleasure to serve as your CEO and I wish you all the very best.

Message to Employees from Northwest Airlines Board Chairman,
Roy Bostock

To all Northwest employees:

On behalf of the Northwest Airlines Board of Directors, I would like to congratulate you on the completion of our merger with Delta and thank you for your hard work and dedication to Northwest.

Your commitment to the airline has shown itself through the industry-leading operating performance that Northwest has experienced over the last several months and over the course of the last several years. As a Board, we firmly believe that the Delta merger is in the best interests of you, our customers, and the communities Northwest serves. We wish you the best as you move forward as part of the world's premier global airline.

And then they got this letter from the new bosses

To: Worldwide Employees of Delta Air Lines
From: Richard Anderson and Ed Bastian
Subject: THE NEW DELTA

Let us be the first to welcome you to the new Delta, the world's largest airline with the best people, most comprehensive route network, strongest balance sheet and best position in the industry. Each of you is an important part of building this great airline.

As you know, we face a very difficult economic environment around the world. Much of the work to bring our two airlines together is well underway, and as we work together to complete the integration over the next 12-24 months, you will see that the new Delta is even better positioned to navigate the tough waters ahead in a difficult economy. The merger makes even more sense as we face an economic recession because we can capture $2 billion of benefits annually that neither airline could accomplish alone.

We have made solid progress since announcing the merger just over six months ago. We testified in Congress, received approval from the European Union, completed an unprecedented collective bargaining agreement with both pilot groups, had our plan to achieve a single operating certificate approved by the FAA, received full approval from our shareholders and, finally, received approval from the Department of Justice. Our progress has been swift but thoughtful, as completing the transaction helps us realize the benefits of the merger more quickly.

At Delta, we care about you, as a colleague and as an individual. Our foundation is open, honest and regular communication. We treat each other with dignity and respect, always. We steadfastly believe it is our obligation to provide a safe work environment for you, solid financial results, competitive pay and benefits. We will do this by ensuring Delta is a strong company built for long-term success and profitability. That is the only true job security in this industry.

Rules of the Road is a set of guidelines we use at Delta every day. If you have not already done so, please review it on DeltaNet. It was inspired by the Delta employee manual from the 1940s written by Delta's founder, C.E. Woolman. He had a saying that is as true today as it has ever been: "Take care of your employees and they will take care of your customers." That is why the only way this merger could happen was if employees shared in the success of the company - from cash payouts to raises to stock awards to profit sharing. Our people will reap the rewards of their hard work.

Delta is a special place. We work hard, deliver safe and reliable operations, provide excellent customer service, treat each other with respect and truly enjoy working for this airline. The new Delta will allow us to grow on the foundation we have built over the last 79 years by bringing two airlines together. We can and will create one great airline. We have already achieved what others could not. We are unique. By working together, we will make this the most successful merger in airline history.

We look forward to what lies ahead for us, this time as a team of 75,000 strong.
Welcome to the new Delta.

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Northwest brand to disappear March 30

Posted at 6:11 PM on October 27, 2008 by Bob Collins (2 Comments)
Filed under: Northwest Airlines

We have a better idea when the "Northwest" brand on employee uniforms will disappear for good if -- as now seems likely -- the feds approve the merger of Northwest and Delta. March 30, according to the Atlanta Journal Constitution.

Delta and Northwest pilots will both get newly designed hat brass and wings for their uniforms with a two-tone red triangular Delta "widget" logo. The rest of the uniform will remain essentially the same. The company decided to stick with the Delta uniform instead of designing a new one to save time and money and to speed the transition.

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Northwest posts quarterly results

Posted at 11:04 AM on October 22, 2008 by Bob Collins (0 Comments)
Filed under: Northwest Airlines

Like Southwest Airlines last week, Northwest Airlines is reporting a profit while reporting a loss.

The company announced today that it lost $317 million in the third quarter. The company took a write-off its hedge bets for fuel; it's a practice that can save money when jet fuel is going up, but not when it's coming down in price.

Northwest says if you take away the write-off, it made money in the quarter, just as you did if you take away the costs of the car repairs and mortgage. The Vikings are also undefeated if you take away their four losses.

In the long run, lower fuel prices should be good news for travelers by virtue of lower fares and an easing of the fees that airlines tacked on when the cost of fuel was rising. It should be. But it's not.

"We waited a while to react to the increases in jet fuel. ... We haven't been able to make that up," said Michelle Aguayo Shannon, a spokeswoman for Northwest Airlines, in a Detroit Free Press article. "But you have to really look at the airfares; there's a false sense that fares are through the roof."

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Southwest Airlines coming to Minneapolis-St. Paul

Posted at 3:34 PM on October 1, 2008 by Bob Collins (7 Comments)
Filed under: Northwest Airlines

Is this fallout from the Northwest-Delta merger and all the associated flight cutbacks? Maybe.

The Dallas Morning News is reporting that Southwest Airlines is to begin service in Minneapolis-St. Paul.

Update 3:45 p.m. - The company has now issued a news release, which says:

"One of the most frequent questions I have been asked over the years is, 'When is Southwest Airlines coming to Minneapolis-St. Paul International Airport?' Today, I can finally give people the answer we have been working toward: 'Very, very soon.' I am confident Southwest will receive overwhelming community support for its new service to the Twin Cities," said Executive Director of Metropolitan Airport Commission Jeff Hamiel. "The Metropolitan Airports Commission stands ready to assist the airline in establishing and growing service to Minnesota."

Initially, flights from here will go only to Chicago Midway, a route that AirTran flew before it went out of business. (Correction: Dropped route. Not out of business.)

It marks Southwest's first new city since it re-entered the San Francisco market in August 2007. Upstart airlines have had a difficult time making inroads into the market because Northwest Airlines has passenger loyalty and is the hometown airline. But by March, Northwest Airlines will be gone, and the airline that replaces it will be based in Atlanta.

I wrote about the possibility of Southwest coming into the market when the Northwest-Delta merger was announced, via an interview with aviation industry expert Dan Petree at Embry-Riddle. He didn't think it would happen and he sized up the Southwest business strategy:

They don't take on people just for the sake of competing. They take people head-on because they think they can get market share and sustain it. They look for available gates at underserved airports, the right mix of business and leisure travel, they look to establish brands in markets where the existing airline appears to have a weakness. The last head-to-head competition was AirTran's entry into Milwaukee. It was resisted by Midwest but at the end of the day it looks to have been successful by AirTran, capturing a large share of the Milwaukee market. They did that because it made sense for them and they perceived a weakness. And Milwaukee is close enough to Chicago that it wasn't considered a major market anyway. Southwest doesn't go head-to-head against major established networked carriers in heavily utilized airports.

What does this do to fares for Twin Cities travelers? They should go down. While AirTran was flying the route in March, a roundtrip ticket to the same destination was $114. Today Northwest charges $395 for the same flight.

In addition, a recent survey, as reported by the Associated Press, showed fares in the Twin Cities have jumped 17 percent in the last year. There were exceptions to the trend nationwide. Cities served by Southwest had lower overall fares. Take Denver, for instance:

Yet fares in Denver are up only 4 percent over the past year. The reason? Southwest Airlines has been adding flights as United Airlines and Frontier Airlines pull back. By Nov. 2 Southwest plans to have 115 daily flights out of Denver, a nine-fold increase from mid-2007.

Southwest Airlines has already been taking on Northwest head-to-head with some success. In Detroit, a Northwest hub, the airline has flown 19 flights a day. While other carriers are bleeding dollars, Southwest has been making money by locking in fuel prices. It makes a profit and has almost $6 billion in cash.

Says the Detroit Free Press:

With a hedge, the airline enters into a contract with a bank or other financial services firm. The airline bets oil prices will go up; the other side bets they will go down. The loser must pay the difference to the other party.

With oil hovering about around $100 a barrel, Southwest has come out on top. For 2008, it has locked in the price for about 70% of its jet fuel based on oil priced at $51 per barrel. For 2009, it has locked in 55% of its jet fuel based on that same price.

Southwest is "more protected" than any other airline if oil prices remain around where they are now, according to Stuart Klaskin, an aviation analyst at KKC Aviation Consulting in Coral Gables, Fla.

I suppose in the long run this is bad news for St. Cloud, an airport that's been getting big enough -- coupled with a metropolitan area that's spreading far enough -- to be a typical Southwest-type location.

As long as we're on the subject of Midway, a fairly significant development was lost in the news hubbub on Tuesday. Midway Airport is on track to become the first privatized big-city airport.

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Airline fees to stay

Posted at 3:07 PM on September 18, 2008 by Bob Collins (1 Comments)
Filed under: Northwest Airlines

Citing high fuel costs, the nation's airlines -- Northwest included -- slapped a bunch of new fees on the traveling public. Now that oil has dropped below $100 a barrel and Northwest is predicting a $60 to $100 million profit in the quarter, the fees are going away, right?

No.

Northwest expects to make $150 million to $200 million per year because of the fees. Why give that up?

"It was only the reality of $140 oil that gave the U.S. industry the courage to pursue a strategy they wanted to pursue," J.P. Morgan airline analyst Jamie Baker told the Wall St. Journal. "You hold onto it as long as you can until competitive pressures force you to back off."

Things are a little different in Canada. There Air Canada has rolled back some fees.

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Airline performance

Posted at 2:47 PM on August 5, 2008 by Bob Collins
Filed under: Northwest Airlines

What are your chances of being on an airline flight that's late? About 30%, the government reported today.

June's performance numbers were better this year than last year, but only slightly.
Weather is the most common reason for delays. In June, 47.21 percent of late flights were delayed by weather, up 5 percent from June 2007.

Here are some Northwest Airlines' and Minneapolis-St. Paul performance tidbits from the report.

Northwest was on time 67.4 percent of the time. Delta was on time 72.6 percent of the time. In May, Northwest was on time 78.9 percent of the time.

Northwest's flights to Newark Airport in metro New York arrived on time only 38 percent of the time. Newark was the worst airport for Northwest. LaGuardia was the worst airport overall for all airlines.

Flights into Minneapolis St. Paul arrived 72.7 percent of the time. USAirways has the best on-time performance into MSP. Flights left MSP on time 76.2 percent of the time.

The worst time to fly into MSP: 10-11 p.m.

The best time to fly into MSP: 6-7 a.m.

Worst time to leave MSP: 4-5 p.m.

Best time to leave MSP: After 11 p.m.

The Northwest Airlines flight arriving late the most often: Flight 331 from Detroit to Los Angeles. It arrived late 90 percent of the time, averaging an hour late.

The most-often-late flight in the country: American Airlines Flight 1639 from JFK Airport to San Juan arrived late 100% of the time, averaging more than two hours late.

Airline with the most flights arriving late 70% of the time: American (12.8%). Northwest ranked 9th at 4.1 percent.

1.3 percent of Northwest's flights were canceled. (11th). The airline tied with Delta.

Northwest ranking for best baggage handling in June: 4th (1st among major airlines)

Consumer complaint ranking (fewest): Southwest Airlines. Northwest was 9th; Delta was 17th.

Airline merger math

Posted at 1:44 PM on July 22, 2008 by Bob Collins (0 Comments)
Filed under: Northwest Airlines

The lower the stock of Northwest Airlines and Delta Airlines goes, and the higher the cost of jet fuel climbs, the more savings, apparently is to be realized by the merger of the two companies.

That's because Delta now believes the merger will produce $2 billion in savings and benefits, up from an original estimate of $1.2 billion, and will cost about $600 million, down from the $1 billion projected earlier.

"When we announced in April with oil at $110, we wanted to make certain we did not over-commit to Wall Street what the real value was," said Delta President Ed Bastian, in an interview with TheStreet.com. "We would rather under-commit and then deliver good news.

"Now that we've had an opportunity to do more detailed work, we've been able to validate the synergies we thought were there, but had a difficult time quantifying," he says. "With oil at $130 a barrel, we have to make sure we are getting every last nickel of synergies and also make sure we have good transparency."

$2 billion in savings between now and 2012. How much is that? That's about one-fifth of the total amount the two airlines lost -- at least on paper -- in just the first three months of this year.

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Live-blogging Midmorning: Your travel-by-air stories

Posted at 6:40 AM on July 16, 2008 by Bob Collins (36 Comments)
Filed under: Northwest Airlines

If there's a "tipping point" for gas prices (the price at which you change your driving habits), is there a "tipping point" for flying on an airline? If so, what is it?

Higher fares, a slew of tacked-on fees, flights that are late and crowded are the new standard in the airline industry. Does it make a difference?

I'll be live-blogging in the studio with Kerri Miller on Wednesday's first hour of Midmorning. Most of the time, Midmorning asks me when they want me to blog their show. This time, I asked them. The guests are: George Hobica, creator of Airfarewatchdog.com; Joe Schwieterman: professor of public service management at DePaul University; and Tammy Lee: Vice president for communications at Northwest Airlines.

And you.

I sense a pent-up desire to tell the airlines a thing or two, and to tell a few stories about your experience -- good and bad.

That's where the "comments" section below comes in. Let's start talking about this now, so that by Wednesday at 9, we'll have something to tell our radio friends.

9:02 a.m. - It occurred to me while getting ready for today's shows that I hear the word Northwest Airlines and blames in the same sentence quite often. A Google search reveals, for example:

Northwest blames high oil prices....

Northwest blames pilots...

Northwest blames speculators...

9:09 a.m. Hobica is up first. He's in Boston on business and took the train to get there. He says the only reason people fly in the Northeast Corridor now is to get frequent flyer miles, which are tougher to spend.

9:11 a.m. Hobica says the stock market has been propping up "the ridiculously low airfares." This is why airlines are "cutting capacity," creating a shortage of available seats. Kerri asks why nickel-and-dime instead of raising fares? "They think demand will drop off," Hobica says. He also says the industry has been mismanaged since deregulation, so "what's new?"

9:14 a.m. Just reading Hobica's blog. Says airlines, having created an unpleasant experience, are now selling travel insurance to guard against such things.

9:17 a.m. Milan from Mankato calls. Flew for TWA for 50 years. "Given what airlines are charging, airlines are losing their shirts. Airlines have to increase fares by 20 to 30% but people won't pay it."

9:19 a.m. -- Cirrus (and I wrote about this a week ago) is depending on the current situation to market its VLJ (very light jet) business. Hobica just uttered the party line when it comes to general aviation (note: I'm not objective on this) by recommending private jets start paying for 'clogging up the skies.' In other words, airlines have something else to blame, now. What do private pilots say? They say "we're paying taxes to support the air traffic control system (via fuel taxes), so why can't we use it?"

9:25 a.m. Just read comments from Mary L. and Larry in comments below. And yours? Where's yours?

9:26 Delta will charge $80 for certain bags each way. Hobica sends his luggage via UPS to his hotel. Cheaper. You can find a chart that compares the cost of doing this here.

9:29 a.m.- Caller Diane flew in from St. Louis. Plane delayed for an hour, missed connection in Chicago. Ticket agents were surly. "Ticket agent said, 'look, all this crying for nothing.'" Hobica says "we're impoverished in this country when it comes to consumer protection." How much do the airlines worry about customer satisfaction? Southwest has very good policies, Hobica says. It's the older legacy carriers that are "ruining it for the reputation of the airlines."

Survey of the Day

This is as good a time as any for today's survey.

.. and now back to the show...

Joining the show now is Tammy Lee, a spokeswoman for Northwest and Joe Schwieterman: professor of public service management at DePaul University.

9:38 a.m. -- "We're in survival mode here," Tammy Lee says. She ran for Congress a couple of years ago. Does being the spokesperson for an airline ruin a political career? Just wondering.

9:39 a.m. -- People appreciate the fees as opposed to simply raising the fares across the board. Is that true? You tell me.

Observations for free: People seem more upset by poor service than higher fees.

9:41 a.m. -- Why not just raise air fares? "We can't get them to stick," Lee says.

9:44 a.m. I just read Erik's comment on service. Tammy Lee says the competitive advantage is the "service experience."

"Ultimately, at the end of the day, the customer is going to flock to the lowest price. If they get there safely, that's all they care about."

Well, there it is in English. We don't CARE about the attitude we have, because you'll put up with it if you save a buck.

Sun Country tested this theory in a recent marketing campaign. Does it work?

9:47 a.m. "When you choose between survival and service, survival wins," Tammy Lee says. I'm immediately reminded of the the story of how a small hardware store in Brattleboro Vermont ran Home Depot out of town

9:50 a.m. - Schwieterman says there's a future for Southwest in the Twin Cities. He says that airline is starting to compete head-to-head more with "the big boys."

9:53 a.m. - Advice from a guest. Get rid of your frequent flyer credit card and ge a cash-back card. You have to pay an $80 fee and now you're paying more to cash in the miles.

Last word on fares We've been tracking the cost of a ticket to Midway from Minneapolis St. Paul for the last few months. Today, it's going for $496.75, and that doesn't include the fees. In March, it was $114 (there was a competing airline flying the route, then).

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Airline lobbyists

Posted at 3:37 PM on July 10, 2008 by Bob Collins (2 Comments)
Filed under: Northwest Airlines

Yesterday, Northwest Airlines whacked its frequent flyers over the head with a $25 charge for redeeming miles. Today, the company -- and other airlines -- asked for their help in a lobbying campaign.

An Open letter to All Airline Customers:

Our country is facing a possible sharp economic downturn because of skyrocketing oil and fuel prices, but by pulling together, we can all do something to help now. Visit www.StopOilSpeculationNow.com.

For airlines, ultra-expensive fuel means thousands of lost jobs and severe reductions in air service to both large and small communities. To the broader economy, oil prices mean slower activity and widespread economic pain. This pain can be alleviated, and that is why we are taking the extraordinary step of writing this joint letter to our customers.

Since high oil prices are partly a response to normal market forces, the nation needs to focus on increased energy supplies and conservation. However, there is another side to this story because normal market forces are being dangerously amplified by poorly regulated market speculation.

Twenty years ago, 21 percent of oil contracts were purchased by speculators who trade oil on paper with no intention of ever taking delivery. Today, oil speculators purchase 66 percent of all oil futures contracts, and that reflects just the transactions that are known. Speculators buy up large amounts of oil and then sell it to each other again and again. A barrel of oil may trade 20-plus times before it is delivered and used; the price goes up with each trade and consumers pick up the final tab. Some market experts estimate that current prices reflect as much as $30 to $60 per barrel in unnecessary speculative costs.

Over seventy years ago, Congress established regulations to control excessive, largely unchecked market speculation and manipulation. However, over the past two decades, these regulatory limits have been weakened or removed. We believe that restoring and enforcing these limits, along with several other modest measures, will provide more disclosure, transparency and sound market oversight. Together, these reforms will help cool the over-heated oil market and permit the economy to prosper.

The nation needs to pull together to reform the oil markets and solve this growing problem. We need your help. Get more information and contact Congress by visiting www.StopOilSpeculationNow.com.

Perhaps the public should charge the airlines a $25 fee for doing so.

There is, of course, plenty of debate about the role of speculation in the run-up of oil prices.

"If by some chance the speculators and manipulators are correct--that oil prices could go even higher, based on supply and demand--then they will have done all of us a favor by ringing the alarm bell. High prices today are inciting suppliers to produce more oil and consumers to use less, which will ease the transition to a future of costly energy," BusinessWeek economics editor Peter Coy wrote this week.

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A work-around for NWA's fees

Posted at 5:44 PM on July 9, 2008 by Bob Collins (12 Comments)
Filed under: Northwest Airlines

I can tell just by the sheer intelligence of the comments that are regularly posted on this site, that News Cut readers are smart -- smart enough, I'm betting, to come up with a way around the fees that Northwest Airlines has decided to impose on the traveling public.

To recap, they are:

$15 for the first checked bag. I assume this is actually a $30 charge, since you pay the same thing coming back.

A $25 fee for frequent flier tickets ($50 across the Atlantic and $100 across the Pacific. If you're wondering -- and even if you're not -- it costs about $1,460 to fly round-trip to Tokyo)

The fee for changing your non-refundable ticket will go up to $150.

Alright, let's put our heads together here and figure out a work-around.

Can we expect to see people trying to jam Titannic-sized trunks into the overhead compartments? How much can we squeeze into a backpack. Is there a market out there for disposable jeans and T-shirts that only last about a week and can be purchased at your destination, used, then tossed?

Go.

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The human face of 'capacity reductions'

Posted at 8:36 AM on June 18, 2008 by Bob Collins (1 Comments)
Filed under: Northwest Airlines

If ever there was a phrase that was so unthinkingly adopted by the news media, it's the one the airline industry came up with to dehumanize layoffs and firings: "capacity reductions."

Northwest, as I posted last night, sent a news release and employee memo out yesterday to describe their latest capacity reductions, using terms such as "employee impacts" and "headcount reductions."

Here's a translation: People are going to lose their jobs.

How does this feel to the people who make up the headcounts? Not so good, as you might expect. Take Sam, for example, who blogs -- a little anonymously -- at Blogging at FL250. In the past few months, we've enjoyed his accounts of rising through the ranks at one of Northwest's regional partners to become a captain.

Today, he provides an excellent dissertation on how capacity reductions translate into the nuts and bolts of employment:

With recent developments in the industry a downgrade and subsequent furlough is looking more and more likely. It'd only take a few hundred furloughs (flowdowns) from RedCo to kick me off the NewCo list, and that's on the small end of expected furloughs at many companies. The political pressure to avoid cuts until the merger is approved may be my saving grace in the short term.

He also provides some real insight into the young vs. old pilot tension at airlines, now that pilots have been allowed to fly until they're 65.

The irony, of course, is that those enjoying an extra five years at the top of the pay scale are those least likely to be impacted by capacity cuts. A guy on the top 5% of the list isn't going to be displaced, much less downgraded or furloughed. I hope the guys staying past 60 enjoy their extra five years. Their newfound freedom to "fly 'till they die" is going to set back a lot of junior guys' careers at least five years.

Another pilot's blog -- Around the Pattern -- takes issue with the assertion that older pilots are getting fat and happy at the expense of the kids:

Why would somebody who has been flying for an airline for 25 years want to continue to work for that airline past the age of 60? Pilots at three of the legacy carriers have lost their pensions and are now relying on the PBGC formula for receiving a percentage of their once-promised retirement (a formula, by the way, that is based upon working until age 65). Pilots at another legacy carrier had their retirement benefits frozen about 4 years ago at whatever they were entitled to receive effective that date. I have met only one pilot so far who meets that "upper 5%" criteria who is still flying, though I have been told there are about a half dozen others at my airline. They are hanging on to see if there will be a buy out that might get them a little closer to the pension they had been promised for so many years.

Regardless of whether they're young or old, it's clear that pilots for the nation's airlines -- along with employees of many industries today -- are not in their happy place.

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Steenland's memo

Posted at 9:27 PM on June 17, 2008 by Bob Collins (3 Comments)
Filed under: Northwest Airlines

Northwest is, as they say, cutting capacity. That's fewer seats, fewer flights, and maybe a shortage. How badly do you want to fly? How much are you willing to pay?

Interesting to note that NWA boss Doug Steenland is still promising to keep hubs open. And it sounds like Northwest is moving closer to charging for the first checked bag.

Here's Steenland's memo to his employees.

Memo to All Employees from
Doug Steenland
June 17, 2008

I wanted you to hear from me first the necessary actions we are taking in response to the continued fuel challenge. Later tonight, at the Merrill Lynch Global Transportation Conference, I will also give industry analysts an update on how Northwest Airlines is responding to the industry's oil shock -- including additional actions we must take to further reduce capacity.

I will also update them on our planned merger with Delta and why now - with the high cost of fuel - this transaction makes more sense than ever.

To put this into perspective, year-over-year for the first quarter, we have had a $445 million increase in our fuel expenses, necessitating the need for an immediate response. On the good news side, for the remainder of 2008, we have hedged 54% of our jet fuel requirements. While these hedges are important, further actions are required to stabilize our airline.

4th Quarter '08 Capacity Reductions

In response to the extraordinary fuel cost increases, Northwest will reduce its mainline capacity (domestic and international) in the fourth quarter of 2008 by 8.5% - 9.5% versus the fourth quarter of 2007. This includes the reductions previously announced in April.

I am pleased that no domestic stations will be closed as a result of the capacity reductions. Instead, we will pare unprofitable flying while maintaining the scope and presence of our network.

We have not yet finalized the specific employee impacts related to the reduced flying, however, for the resulting headcount reductions, we will first look to voluntary separation programs such as early-outs.

Q4 '08 Capacity (ASMs) % change vs. Q4 '07
System mainline capacity (domestic and international) (8.5%) - (9.5%)
Domestic consolidated (includes regionals) (7%) - (8%)
System consolidated (includes regionals and international) (3%) - (4%)

Fleet reductions

As a result of the reduced capacity, Northwest is removing a combination of 14 B757s and Airbus narrowbody aircraft from the fleet.

In addition, the DC-9 fleet will be reduced from 94 aircraft at the start of 2008 to 61 aircraft (20 DC9-30s and 41 DC9-40s/50s) by year-end.

Northwest also accelerated the retirement of three freighter aircraft from its cargo operation.

Revenue Enhancements

We are also continuing to take actions to improve our revenues with added fuel surcharges, fare and fee increases. In May, we began collecting fees for two or more checked bags, and are exploring whether we match our competitors by charging for the first checked bag.

Cost Containment / Fiscal Discipline

As part of our disciplined fiscal approach, we are closely managing our capital expenditures, having reduced planned non-aircraft cap-ex spending in 2008 from $255 million planned to $150 million as our new target.

Our aircraft leases were renegotiated during our restructuring, with pre-committed financing on favorable terms for all aircraft deliveries.

Our finance team also successfully negotiated a favorable amendment to our credit terms.

Finally, due to our strict fiscal discipline and best-in-class liquidity, we recently negotiated more favorable terms to our credit card processing agreements.

The Case for the Merger is Stronger than Ever

When we first contemplated a merger with Delta, as oil was approaching $100 a barrel, we knew this was the right deal with the right partner. Now, with oil above $130 a barrel, the case for the merger is stronger than ever with its resulting synergies.

· The merger-related synergies will improve the financial ability of Northwest and Delta to meet the challenge presented by the fuel crisis and better position the combined carrier for long-term strength and profitability.

· This is a transaction that is facilitated by best-in-class cost structures; one that will create an industry-leading balance sheet in any operating environment.

· The transaction will create a worldwide, geographically balanced network - which will enhance customer preference and make the combined carrier more competitive.

· This is a merger of choice by the two strongest network carriers. With our colleagues at Delta, our transition teams have already begun planning for a smooth and rapid integration in order to promptly capture and potentially exceed the synergies projected when we announced the deal.

Looking back on the announcement of our merger with Delta, we are more confident than ever that this was the right deal at the right time. Moving forward, the combined carrier will be in the best position to compete globally -- validating that this was the right transaction for our employees, customers, shareholders and the communities we serve.

As we continue the integration planning, we will keep you updated. In the meantime, thank you for continuing to run a great airline and helping to position us for a brighter future in the combined carrier.

Yours Truly,

Doug Steenland
President & CEO

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Who can figure airline pricing methods?

Posted at 6:27 PM on April 28, 2008 by Bob Collins (4 Comments)
Filed under: Northwest Airlines

The Associated Press reports today that Delta is adding a $10 to $40 round trip fuel surcharge. Northwest and US Airways say they are studying Delta's move. Last Friday, Northwest was the last of the big carriers to agree to a 3-to-5 percent price increase first announced by United.

Every few days, it seems, there's another story of an airline increase so if you haven't looked at a while, perhaps you're steeling yourself for sticker shock.

But it doesn't always work out that way.

A month ago, I wrote that fares were expected to go up when ATA announced it was ending its Minneapolis to Chicago (Midway) run. The Northwest fare to Midway almost doubled -- from $114 roundtrip to $210 roundtrip -- once the ATA competition disappeared.

However, at the time, Northwest was charging $384 for a roundtrip flight to O'Hare. Today, even after all the news reports of price increases, a roundtrip ticket to O'Hare is half of what it was a month ago ($193).

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Merger math

Posted at 2:14 PM on April 23, 2008 by Bob Collins (9 Comments)
Filed under: Northwest Airlines

How do you make a small fortune in the airline business? You start with a big fortune.

Northwest Airlines lost $4.14 billiion in the first quarter of the year. What does burning through that kind of cash look like? Something like this, maybe:

That's $540 in $10 bills sucked into the jet engine every second. Do that every second of the day for three months and you'd be Northwest Airlines.

Up it to $887 a second and you'd be Delta.

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The Southwest Airlines Factor and more answers to your questions

Posted at 7:02 PM on April 15, 2008 by Bob Collins (0 Comments)
Filed under: Northwest Airlines

During the day, we've been getting answers to the questions you've submitted. After the frequent flier question, the most often asked question is "Can we get Southwest Airlines to come here?" The short answer is "probably not." But Southwest is playing a big role in this merger. Late this afternoon, a lot of questions came in about the future of regional airlines. A lot of regional pilots go to school in these parts and then sign on. So we've got some answers. Sort of. (By the way if you want to read a good blog by a regional pilot, go here)

The last interview I have for you today is with Dr. Dan Petree of Embry Ridle Aeronautical University, who once was "one of us," having taught at Concordia College in Moorhead. I tracked him down at a conference in Hawaii, and he turned out to be a fabulous interview.

I'll be writing up the Cliff Notes version but as I do, Here's the whole interview. Oh, and here's audio of my appearance with Tom Crann on All Things Considered tonight. Many thanks for your questions.

With that, let's get to your questions and Dr. Petree's answers.

Q: Northwest/Delta says anti-trust concerns should be allayed by the fact Southwest is still out there providing "price discipline." How big of a factor is Southwest in all of this?

A: Southwest is a metaphor for low-cost carriers that do provide some assurance against predatory pricing or extraordinary rents being attracted by markets that lack competition. We don't really know if Southwest will offset the effect of large airlines, but we do know their impact has been profound. It's hard for a lot of us to understand how you take two high-cost competitors and suddenly make them low-cost competitors, but the market is significantly different today than 20 years ago and the low-cost carriers are playing the tune. Low-cost carriers shouldn't be too worried about the merger. (Listen - 5:55)

Q: Any chance of Southwest coming to Minneapolis-St. Paul?

A: Unlikely. The conditions have to be exactly right for Southwest. They don't take on people just for the sake of competing. They take people head-on because they think they can get market share and sustain it. They look for available gates at underserved airports, the right mix of business and leisure travel, they look to establish brands in markets where the existing airline appears to have a weakness. The last head-to-head competition was AirTran's entry into Milwaukee. It was resisted by Midwest but at the end of the day it looks to have been successful by AirTran, capturing a large share of the Milwaukee market. They did that because it made sense for them and they perceived a weakness. And Milwaukee is close enough to Chicago that it wasn't considered a major market anyway. Southwest doesn't go head-to-head against major established networked carriers in heavily utilized airports. (Listen - 3:35)

Q: Mia, of St. James, Minn., was one of many people who asked, "What is going to hapen with the regionals that fly for both. Northwest uses Mesaba, Compass, and Pinnacle for their regional routes. Obviously they will not need all three anymore.

A: They have different strategy. Delta has gone from owning the regionals to spinning them off and then competing head-to-head with them. If I were looking at a map, I'd be most concerned if I were in Cincinnati with ComAir. How can you maintain that many hubs and do it efficiently? Clearly they're going to want discipline to flow through the whole system. We just saw Delta just discipline Mesa Airlines, who they had a long-time relationship with. They basically said "you're done." I don't think there's any reason to think these relationships will go on forever just because they always have. The expectations are going to change and the regionals will have to figure out if they can compete. The real question is the communities served by the regionals. Do they have reason to expect their service will increase under this new regime; that goes to the economic vitality to a particular 'city pair.' (Listen - 3:48)

Q: A pilot on a closed pilots' forum online asked us to ask, "What does the combined carrier plan to do about a 100-seat aircraft replacement? Our DC-9s are the only true 100 seaters that the combined carrier owns. There is clearly a need to have a 100-seat airplane, but the 9's are old and need to be replaced. Obviously, we want a mainline replacement airplane, and not another attempt to outsource more of our flying."

A: It's hard to make money with jets under 100 seats. What you're likely to see is an investment in Embraers and additional regional jets at 120-150 seats and get rid of the smaller regional jets, it could lead to higher volume operations in some of the smaller communities. They're going to rationalize their service around demand. If demand for 200 seats, and they're doing it with three flights in a 70-seat aircraft, chances are they're going to reduce service to two 100-seat aircraft until demand demonstrates that they need to add additional aircraft. The DC-9 isn't done. These things take time to work themselves out. If a particular market can sustain the economics of an inefficient and relatively old aircraft and it's available, there's no reason why they wouldn't use a DC-9. Longer term, they're signaling that the current economics do not favor regional jets or any jet that's below 100 seats, primarily because of the price of fuel. They might be trying to buy additional larger RJs, in the 115 seat category as opposed to taking delivery on some orders they may already have in place for 70-seat RJs. (Listen - 2:46)

Q: Jason Voiovich of St. Paul asked, "Another angle on the Northwest/Delta merger is what that merger means not just for the airline industry, but for the Minnesota "brand". Losing the corporate headquarters makes it harder for the state to "sell" itself nationally as relevant in the airline industry (the action will now take place in Atlanta). The more we corporate HQ's we lose at the "top end" of an industry spectrum - like NWA - , the more difficult it will be for the state to attract and retain top talent, investment, and satellite companies that grow up around it. In other words, the economic impact could be deeper than just this specific company.

A: For the answer -- sort of -- we turn to Jason Voiovich who writes about branding on a blog called State of the Brand 2008. He writes:

Minnesota is a "biotech leader" because of Medtronic and Mayo Clinic. Minnesota is a "manufacturing/innovation" leader because of 3M. Minnesota is a "retail powerhouse" because of Target. The state is an agricultural/food innovator because of Cargill and SuperValu.

Until now, Minnesota was an "aviation center" because of Northwest Airlines.

It's a fascinating essay and one well worth reading and discussing. Also see some interesting comments from former Norwest Bank boss Jim Campbell in Brandt Williams' story.

This pretty much wraps up "Northwest-Delta Day" on News Cut. It's a different approach to covering breaking news and I hope you've been able to follow along.

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How long will it take to paint over Northwest?

Posted at 5:28 PM on April 15, 2008 by Bob Collins (2 Comments)
Filed under: Northwest Airlines

In order to "brand" (see interview below) the current Northwest jets into Delta's colors, there'll be a fair amount of work involved. When Northwest last changed its logo, the new paintjobs were done on a staggered basis, as the jets went in for maintenance. There might still be "old" colors on some NWA jets, and that project started in 2003.

The airline can't ground its entire fleet for a paint job, so becoming branded will take time. How much? According to one expert on a forum:

I saw UAL 747-400's get painted in about 10-14 days working 3 shifts.... I've seen Piedmont Dash-8 get painted in about 7 days. Keep in mind a lot of that is driven by the number of people you have working the job. We did an E135.... not a Legacy... for a corporate client last year that was in the paint shop for 3 weeks.

Most agree an average of a week per plane. With 500 airplanes, that would be 9-10 years if they only did one airplane at a time (recognizing they don't paint just one airplane at a time). New airplanes, of course, will be delivered with Delta's colors if the merger is approved.

And in this video, you can see how many coats it takes:

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Whither the NWA headquarters?

Posted at 3:12 PM on April 15, 2008 by Bob Collins (1 Comments)
Filed under: Northwest Airlines

Here's the letter Gov. Pawlenty said to the Delta-NWA bosses this afternoon, seeking clarification of just what the future is for the Eagan executive offices.

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The investors have spoken

Posted at 3:50 PM on April 15, 2008 by Bob Collins (1 Comments)
Filed under: Northwest Airlines

Wall Street has just closed up shop for the day. Delta lost 12 percent of its value, closing down $1.32 (Chart here). Northwest lost about $1 a share; that's an 8 percent drop in value (See chart).

What were the investors telling us?

They want more cuts.

Here's Nathan Grawe's take on it. He's associate professor of economics at Carleton College

"The argument they (Northwest and Delta) are trying to make is that by providing a better network for consumers, they will increase revenues and so they don't have to touch the cost side. And if you look at what happened to Delta and Northwest stock today, I think what you saw is investors were frankly disappointed by what they heard because they thought the whole point of the merger was to weed out unnecessary costs and we could gain economy of scale by having a larger company and eliminating redundancy." (Listen to his full answer)

"It seems that almost inevitably in the long run, you'd have to have some jobs become redundant," he says. He expects more job cuts. "The only question is how big and how painful."

Here's my entire interview.

By the way, perhaps you -- like me -- have been blown away by the sheer jargon of this thing. "City pairs?" "Revenue synergies?" "Wage harmony?" What language are they speaking?

Here's a couple of explanations, thanks to Grawe.

City Pair -- Start in one city, end in another city. Those two cities are "paired." Minneapolis to Boston, for example, makes Minneapolis in Boston one city pair.

Wage harmonization - When one group isn't paid more -- or less -- than another group of workers for doing the same thing. There are, of course, two ways to achieve "harmony:" Bring the lower-paid worker up or bring the higher-paid worker down. That of creates disharmony.

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Airline Branding for Dummies

Posted at 2:38 PM on April 15, 2008 by Bob Collins (4 Comments)
Filed under: Northwest Airlines

Somewhere, deep in the bowels of the Delta corporate headquarters, someone is working on "branding" the "new" Northwest-Delta Airline. But it may take up to three years to wipe out the Northwest Airlines name, and even longer to integrate cultures. A pilot friend told me today that there's still angst at the soon-to-be-former Northwest that stems from the different cultures of Northwest Orient and Republic airlines.

In the end, though, it's all about the perception -- the message -- that a Delta name (as opposed to an NWA name) gives to fliers.

I talked this afternoon with Barbara Schenck, an expert on branding, and the author of Small Business Marketing for Dummies, Business Plans Kit for Dummies, and Branding for Dummies, about the marketing challenges companies face when merging.

Here's the full interview (mp3). I'll add the Cliff Notes versions over the next few minutes.

How does Delta keep whatever favorable message the Northwest brand brings while wiping out the Northwest logo and identity? (Listen)

Is there a lot at stake to wipe out the Northwest name as quickly as possible? Yes. (Listen)

The logo is the face of the brand. The brand is the promise that lives in a consumer's mind. (Listen)

The message of the airline doesn't matter as much as what the consumer experiences. Take American Airlines, for example. (Listen)

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Your frequent flier miles and you

Posted at 1:12 PM on April 15, 2008 by Bob Collins
Filed under: Northwest Airlines

Ask a passenger about the effect of the Delta-Northwest arrangement, and the first thing they want to know is "what about my frequent flier miles?" For the record, both airlines say there'll be no change, that Sky Miles and World Perks will be "integrated seamlessly." But you'll likely see some changes. First, depending on which bank card you use to accumulate miles, you may be doing business with another bank. In an investor conference call this morning, airline officials said agreements with both US Bank (World Perks card) and American Express (Sky Miles card) are up for renewal. It's likely the new airline will sell its miles at a higher price to one or the other. That changes the bank you do business with -- maybe -- and potentially how many miles you get for each dollar purchased.

Even without the merger, says Mark Ashley, who runs the travel site, Upgrade: Travel Better, there are plenty of changes coming.

Here's my full interview.

I'll be posting the Cliff Notes version over the next few minutes.

Frequent flier programs aren't as much about loyalty anymore. They're about making money. (Listen)

Consumers have to get smarter about using frequent flier miles. (Listen)

What's the value of a mile? Try to get the equivalent of 1.7 cents a mile. Don't use miles on competitive routes. (Listen)

Miles are becoming less valuable because airlines are putting more restrictions and fees on cashing in miles. In short term, probably not an immediate change. Balances won't go down, but rules and redemption tables are likely to change. (Listen)

You'll probably need 20-percent more miles to get a 'free' ticket. Airlines will "tier" their frequent flier awards making it harder to get a seat. (Listen)

Airlines make their money by selling miles to the credit card companies. (Listen)

So what should you do now? Cash in your miles now, not because they'll be worthless, but because there will be fewer seats available. Writer Peter Greenburg goes so far as to call the situation "frequent flier fraud."

The airline are under no regulation to redeem those miles. They're under no government mandate to redeem those miles. There's nobody overseeing those programs. As a result, they are the most profitable divisions of the airlines.

Frequent-flier mile programs are making more money than the core operations of the airlines. The actual market valuation of the American Airlines frequent-flier mile program--it's the oldest program, it's the largest program--is valued at over $6 billion. Did you know that the entire market capitalization of American Airlines is $5 billion?

So, if you think that the answer to saving your airline is shrinking it, and you never want to displace a revenue passenger, and you're under no obligation to redeem those miles.

Still to come on News Cut today: A talk with a branding expert about wiping out the Northwest name, logo, and image.

Delta-NWA news conference

Posted at 11:33 AM on April 15, 2008 by Bob Collins (4 Comments)
Filed under: Northwest Airlines

After the investor conference call, the same three airline officials had a press conference for the ink-stained wretches.

Here's the audio. (Sorry, it's RealAudio. Just pretend it's 1999 and airlines are profitable.)

The most frequently asked questions of the last few months were once again frequently asked.

Q: What about the NWA pilots?
A: "We still have 8 or 9 months to 'bring them on board,' and if we do, it'll be a game changer. If we go past that date it's the traditional policy, which is normally the way these things proceed during a merger. (Translation: There'll be a labor battle)

Q: How quickly do you think you'll achieve profitability?
A: "We expect the combination to be profitable in the first year of operation." (2009)

Q: When did the decision to merge come up?
A: December.

Q: Surveys show a decline in service of major carriers, will these combined companies potentially weaken the level of service?
A: Northwest was tops on network carriers, Delta was second on J.D. Power survey. "At a baseline level, these two carriers have good operating performance." (Reaction, anyone?) Gives more service options to consumers. Frequent flier program will be much more valuable. More capital available to "enhance experience for our customers.

Q: Why is there a need to have hubs in Memphis and Cincinnati? And why use less efficient aircraft?
A: We have the right size of operation to make Memphis profitable (Steenland). It offers its own unique sense of destinations. All of the hubs have a "very secure future." It's not a political decision.

Q: If oil had remained at $60 a barrel, would you be here today?
A: "The strategic basis for this announcement is a sound strategic basis whether fuel is at $60 or what it is today." (English translation: "Yes, because the hedge fund that owned a bunch of our stock made us merge with another carrier.")

Q: Why is getting bigger better?
A: Steenland: Northwest is pre-eminent airline, particularly to Japan. Our domestic operation is not "appropriately sized." Now, because of the strong presence that Delta has -- at JFK, for example -- we can get back into the JFK-Tokyo market. Larger scale domestically allows us to better use that resource."

Combined carriers will have an unprecedented scale and scope. Our ability to go to caterers, suppliers to "streamline operations" will be considerable.

Q: What about non-frontline employees?
A: Administrative and management, we are going to have voluntary programs to avoid "involuntary." But at the end of the day there may be involuntary action. (Translation: Well, do I really need to translate that?)

Q: How merger will affect regional partners?
A: Will be operating combined fleet of 600 regional airplanes. Northwest owns two very good regional carriers -- Mesaba and Compass. Delta owns Comair. "We'll be optimizing the number of carriers to maximize the efficiency of the carriers. Our goal is to have the margins in that business to be equivalent to mainline airlines." (Translation: Cuts)

Q: Worried about strikes or job actions?
A: We''ll continue to discuss the benefits of the combination. Confident we'll continue to provide an excellent product. (Translation: The fact there was no yes or no answer allows you to fill in your own.)

Q: In the future, will you be more Boeing or more Airbus?
A: Both Boeing and Airbus make very good airplanes. The combined airline will be the largest operator of A330s and 757s. We would expect that balance to be the case going forward. The combined enterprise has 80 airplanes on order over the next five years; the vast majority have "backstop financing." Airplanes are financeable assets. We will not buy an airplane that doesn't make economic sense.

Q: What does it mean for consumers if there are only 3 big carriers.
A: We can't predict the future but confident the U.S. market will be competitive. "Let's not forget we have Southwest out there. It will provide 'pricing discipline.' Entry in this business is wide open; there's plenty of airport gates, facilities, airplane manufacturers are willing to finance. The market will remain competitive. There's no other business out there that has as much transparency in selling their products. You can go online and see every choice available to you (Bob notes: Do they actually look at Travelocity and see that every airline seems to charge the same price?)

Q: Experts say there's needs to be capacity cuts. Are you planning that?
A: We already are cutting capacity. We're pulling back unprofitable routes. Delta will be down 10 percent compared to last year. Northwest is making a 5 percent cut. The merger isn't predicated on cutting capacity.

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Union's letter to NWA pilots

Posted at 9:46 AM on April 15, 2008 by Bob Collins (0 Comments)
Filed under: Northwest Airlines

TO: All Northwest Pilots

FROM: Dave Stevens

DATE: April 14, 2008

In the wake of the Delta-Northwest merger announcement today, I am writing to update the Northwest pilots. I will start by giving you the conclusion. Since January 2008, we have been working hard to put together a cooperative merger between the Northwest pilots, Delta management and the Delta pilot leadership. Agreement on the terms for a cooperative merger was in all stakeholders' best interest in better times, with oil below $90 per barrel. With oil over $110 and an economy facing recession, and given the recent activities of the two managements and the Delta MEC, a merger with Delta may no longer be in the best interests of all Northwest stakeholders, including the Northwest pilot group. Northwest Airlines has strong standalone prospects given its cash position (best of the legacy carriers) and the flexibility of the NWA fleet, among other things. We are in a good position to weather the potential economic storm.

As a quick review, we started exploration of a cooperative merger with four key requirements from NWA MEC Resolution 08-01:

1. Creation of a profitable merged company with sufficient market presence and network scope to provide a stable platform for growth and sustainable profits;

2. Fair and equitable seniority list integration;

3. Collective bargaining agreement for the merged company with substantial improvements; and

4. Share in the equity of the merged company.

A cooperative merger provides a win-win formula for labor and management. By achieving a joint contract and seniority list prior to the effective date of the merger, revenue synergies and cost efficiencies are generated immediately (worth many hundreds of millions of dollars per year), and a portion of this economic upside could go to the pilot groups in the form of contract improvements and equity.

Since January, we have met with the Delta pilot leadership and Delta management in three extended efforts to accomplish the above requirements. By the end of the second session, we had accomplished requirements #3 and #4. However, we were unable to reach agreement on #2, an equitable seniority list, which is essential to accomplish #1. There was a great deal of collaborative effort expended by the Delta pilot leadership and Delta management to convince us to accept inequities in a seniority list in return for improved economics in a joint contract. As you know all too well, seniority is forever while economic provisions can be short lived.

The first two negotiations took place in New York City with oil below $90 per barrel. While we achieved agreement on a joint contract and equity and made progress on a seniority list, we did not achieve an equitable seniority list. The third negotiation took place in Washington, D.C., and while more progress was made on seniority, a seniority list agreement was not reached.

The seniority negotiations broke down over the Delta pilot leadership's desire to include aircraft options, not just orders, in the seniority integration ratio. We were not willing to adjust the seniority integration ratio in favor of Delta pilots based on options, particularly when such options were unlikely to be exercised, other than as replacement aircraft, in the worsening economic environment. There were additional problems concerning calculation of the number of active pilots at each carrier and staffing assumptions for the future. The resulting difference in our respective positions on a ratio was substantial. The actual breakdown occurred when, in response to my suggestion that we both compromise and bring that to our respective MECs for their consideration, we were advised that the Delta pilot group could not move off their last ratio proposal.

As we had several times before, we then suggested to the Delta pilot leadership that we agree on expedited arbitration of the outstanding issues by a date certain. The result of an expedited arbitration would have been functionally the same as an immediate negotiated agreement since there would have been one seniority list and a joint contract in place on the transaction effective date.

By use of this process, much of the transaction risk would have been taken out of the merger and additional funds would have been generated to pay for one-time transition costs. In the uncertain world of airline economics, this was a key consideration. When two airlines merge, they attempt to realize the benefits of the created synergies before they run out of cash on hand to pay for the transition costs. In our current environment, there is no more money to borrow and airlines have few assets left to encumber.

Unfortunately, the Delta pilot leadership rejected arbitration, whether expedited or not, as a means to resolve the seniority list dispute. From that point, Delta management, the Delta pilot leadership and Northwest management chose a different path. NWA management proposed a traditional merger to Delta management. Then Delta management entered into bilateral negotiations with the representatives of the Delta MEC. The representatives of the Northwest pilots were excluded from the negotiations. Inexplicably, the Delta pilot leadership reversed its position. They are now willing to arbitrate the seniority list issues under ALPA merger policy. At the same time, they abandoned the joint pilot contract approach and have, instead, agreed to a Delta pilot contract amendment which will increase the pay and benefits for only Delta pilots. The Northwest pilots are excluded from the economic benefits. Both managements have cooperated in this change in course.

Yesterday we met with Delta CEO Anderson, President Bastian and EVP Campbell. At that meeting, we suggested that they delay the merger announcement and spend a short period negotiating a joint contract with a focus on their harmonization issues. This suggestion was rejected in favor of the plan they are currently pursuing. In explanation, they said we were out of time to negotiate prior to a merger announcement date (despite the fact they found two weeks to negotiate a deal with the Delta pilot leadership).

As a result, there will be seniority arbitration in a traditional merger process and it may take a long time. The Delta pilot leadership may choose not to cooperate on a joint contract for the benefit of the Northwest pilots while they seek an agreement on seniority that favors the Delta pilots.

Now we reach the question your MEC considered at its meeting yesterday - Should the pilots, employees and customers of Northwest support this merger as it is currently contemplated? The managements are betting on the merger models of old: Pay the employees of one group less and focus on lowering costs (instead of many of the revenue synergies that are far more likely to improve the bottom line); hope for cost savings going forward from employee division with no concern for the dis-synergies caused by labor dissatisfaction. The point has already been made to us by Delta management that they already have a "B scale" at Northwest, and that they will need to maintain it by phasing in harmonized wages. Mergers based on this model have never worked well, but trying to make this work at $110/bbl fuel, with a looming recession and no access to credit markets, is putting everything at risk.

One can only conclude that the Delta pilot leadership and Delta management have made an arrangement to try to disadvantage the Northwest pilots economically and with respect to our seniority. No pilot group is going to put up with this. No amount of money can sustain a carrier which creates this level of discord. This is a recipe for failure. Under these conditions, Northwest Airlines and all the stakeholders, including the pilots, other employees and customers, are better served by a standalone airline. Under these circumstances, it is Northwest's best option, with its strong international and domestic route structure, a flexible fleet, an order book with fuel-efficient aircraft and the best cash position of any legacy carrier, to remain an independent carrier.

Your MEC reached this conclusion with reluctance. We were very close to concluding a truly cooperative merger which would have served the interests of everyone. We regret that an agreement was not obtained. However, the past is past. The Northwest pilot group now has to face a difficult future. As hard as a standalone course may be in these economic times, it is our judgment that it carries less risk than the merger path which now lies before us. For that reason, we will be turning our efforts to stopping this merger. Over the course of the next few weeks, we will be sending you more information on the MEC's plans. Look for a road show schedule to be posted soon.

Fraternally and in Unity,

Dave Stevens
MEC Chairman

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Live blogging the NWA-Delta conference call

Posted at 8:01 AM on April 15, 2008 by Bob Collins (1 Comments)
Filed under: Northwest Airlines

8:04 a.m. Richard Anderson of Delta and Doug Steenland, boss at Northwest, are holding a conference call for investors.

(Latest factoids are added at the bottom)

8:04 - Anderson: "With fuel prices what they are, the changes in the open skies area, we think it's a really good fit. The balance sheets are in great shape. The route structures have been rationalized. Strong cash position with about $7 billion in liquidity."

8:07 - Steenland: "Merger by addition." He cites relatively little route overlap.

8:09 - Steenland: "Combining functions such as I.T." There's your first clue of whose jobs are in peril, I guess.

8:13 - Steenland tries to downplay anti-trust concerns. Here's a graphic he used:

8:15 - Anderson: "No need for hub closures."

8:19 - How long will this merger take. "We plan to achieve all synergies by 2012," Anderson says.

>> $$$ Alert! NWA stock preopen price up $1.03 at $12.25. Delta opens up .27 at $10.25. The premium is now down to 56 cents based on Northwest stockholders getting 1.25 shares for every share of NWA stock owned. It was $1.88 based on the closing numbers yesterday. This number is changing quickly. See Delta stock details here. See NWA stock details here. <<

8:28 - Anderson expects regulatory approval by the end of the year.

8:29 - Time for questions (Operator: It's not pronounced AX a question!)

8:30 - Company anticipates more use of 100-seat airplanes. But that's not good news for aircraft manufacturers. It'll involve use of existing aircraft. Plans to use DC-9s more; that's the plane Northwest had been trying to phase out.

8:38 - Both of Northwest and Delta coming up on "affinity card relationships." "We'll be in a position to maximize our position for our shareholders." English translation: Between U.S. Bank (Northwest) and American Express (Delta), someone's going to lose some money.

>> The best-laid plans alert!! -- Oil just passed $113 a barrel -- up $1.57. A new record high. <<

8:45 - Steenland: Would like Continental to stay in the "Sky Team" relationship (frequent flier miles and code sharing).

8:54 - "Revenue synergies" (i.e. saving money) depends on pilots getting on board.

8:56 - Analyst Ray Niedel asks "what made you finally decide to do this merger" considering failure of other airline merger attempts. "Not all mergers are created equal," Anderson said. Says two airlines already have alliance "so we're already well down the road and unlike a lot of the mergers you're talking about, those mergers involved carriers -- one or the other or both -- that were in distress." Says the two different "fleets" work better because 'we don't have to sit down and merge a lot of maintenance operations." Large differences in fleets (types of airplanes) gives the new airline more ability to size the jet to the market being served.

9:02 - >>> Disappearing dollars alert!! NWA stock now down 72 cents to $10.50. Delta down almost a $1 a share. That's what a runaway day in the oil market (now up almost $2 a barrel on the day) will do. <<<

9:07 -- End of conference call. During the conference call Delta's stock dropped $1.35 from the preopen price. Northwest dropped $1.65 a share.

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NWA-Delta: Who benefits?

Posted at 7:10 AM on April 15, 2008 by Bob Collins (1 Comments)
Filed under: Northwest Airlines

Keeping up with the analysts and experts and continuing to pass along your question. Add yours to the comments section here?

Q: Who benefits from a merger?

A: Large investment houses, according to h, an independent analyst in Phoenix. "The hedge funds and European airlines have been driving all of the merger talks you've been hearing the last few years," he said this morning. "The hedge funds made big speculative investments in both Delta and Northwest and they're hoping that all this merger talk will drive up stock prices so they can cash out, which unfortunately will leave the implementation mess to somebody else."

Q: Does the public benefit at all?

A: "No, there's no good news for consumers," according to Horan. "We're in an environment where a lot of airline routes will never make money at today's fuel prices. There's going to be less service, not more service. Fares are going up and not down. Delta-Northwest and these other megamergers that are going to follow create a whole set of new problems on top of that. They're not going to get the industry back to profitability; there are not enough synergies. There's a big risk of implementation-operational debacle which will make what American Airlines customers went through last week look like the proverbial Sunday picnic and there are big anti-competitive risks, primarily on long-haul international, where there is much more danger to consumers than there is domestically" he said on CBS' Early Show.

Q: How long will it take?

A: "In order to get some savings out of this, they've got to go very fast," Horan said. "But that creates the situation of an operational mess. I would say this will take at least a year from the time it gets approval."

"You might execute this properly and not screw it up. But in the real world of these airlines in this kind of environment, there's a huge chance that it does get screwed up," Horan also told MPR's Marty Moylan.

FMI: See Horan's article, "Top 10 false claims about the need for airline mergers."

Q: What about the reservations center in Chisholm?

A: "When we have talked to Northwest about that reservations center, they have decided to keep it open, when they close other centers in New York and Florida. And they comment on its productivity, the work ethic of the people. They've moved more and more complicated work there. It will certainly be on the list of the things we will fight for. But it's from a strong position," State Employment and Economic Development Director Dan McElroy said on Monday night.

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Gary Chaison on the NWA-Delta merger

Posted at 8:09 PM on April 14, 2008 by Bob Collins (1 Comments)
Filed under: Northwest Airlines

Just got off the phone with Gary Chaison, a labor studies professor at Clark University in Worcester, Ma., who follows the airline industry.

Here's the full interview. (MP3)

Signals the beginning of more hard times in airline industry. (Listen)

Impact of merger will be felt quickly, with many job losses (Listen)

Pilots hold the key for a happy merger. (Listen)

What's the big deal with seniority? (Listen)

Why do Northwest's pilots have more seniority than Delta's pilots (Listen)

50-50 prospects that it can survive Justice Department review. (Listen)

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What's it mean to me?

Posted at 6:15 PM on April 14, 2008 by Bob Collins (3 Comments)
Filed under: Northwest Airlines

The merger of Northwest and Delta is a done deal. I'm resisting the urge to go buy Northwest Airlines trinkets to sell 20 years from now on EBay, and instead am turning my attention to monitoring your most pressing questions on the merger. We started this the last time we thought the merger was at hand.

Delta, for the record, took honors for announcing the merger. As of 7:30 p.m., the airline had set up a section on its Web site about the merger. NWA.com, by contrast, had zip.

Submit the questions and we'll do our best to get them answered as details spill out on Tuesday. A news conference is planned for 9:30 a.m.

Here are the main questions submitted so far:

What happens to my frequent flier miles?

Probably nothing. Delta and Northwest already are partners in the Skyteam alliance. So you can fly on Delta and have points added to your WorldPerks account.

This evening, Northwest sent the following out to WorldPerks members:

You can be assured that your WorldPerks miles and Elite program status will be unaffected by this merger. In addition, you can continue to earn miles through use of partners like WorldPerks Visa®. And once the new Delta Air Lines emerges you can look forward to being a part of the world's largest frequent flyer program with expanded benefits.

I own Northwest stock. What do I get out of the deal?

You will get 1.25 shares of Delta stock for every share of Northwest stock you own. As of the close of business on Monday, a share of Northwest stock was worth $11.22. Delta closed at $10.48. That's $1.88 premium per share of Northwest stock.

Will this end the virtual monopoly at MSP airport?

Probably not. One of two cities is more likely to feel the pain: Detroit or Cincinnati, according to Pardus Capital, a hedge fund that owns about seven million Delta shares and was the driving force behind forcing Delta to seek a merger. It said in November that the merger could save $1.5 million a year, mostly by combining hubs. Detroit (Northwest) and Cincinnati (Delta) are two likely candidates to be combined as well as Memphis (Northwest) and Atlanta (Delta).

However, in the announcement -- and you have to take this with a grain of jet fuel -- the new airline said hubs in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis/St. Paul, New York-JFK, Salt Lake City, Tokyo-Narita, and Amsterdam would be maintained.

Will this open the door to Southwest to move into Minnesota?

It depends on whether the MSP stays as a hub, and early indications -- mostly the plan to keep executive offices in Minneapolis -- are that it will.

Why would this merger make it through Justice Department review, especially given the collapse of the United and USAir merger?

Tune in Tuesday. Clearly the new airline is concerned. It's organizing a letter-writing campaign on its Web site.

Gary Chaison, a labor studies professor at Clark University, gives it a 50-50 chance. See interview or just listen to his answer to the question.

What's the next domino?

This one, of course, is speculation. But airline analyst Robert Mann says a United-Continental marriage will follow soon. That would leave American looking for a suitor.

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