Delta's ascentby Annie Baxter, Minnesota Public Radio
A merger between Eagan-based Northwest Airlines and Atlanta-based Delta Air Lines still appears to be in the works.
Pilots for the two carriers met last week to discuss how to integrate their seniority lists. Lack of agreement among the pilots appears to be the main obstacle to a deal.
It's widely believed that Delta would be the acquiring carrier in the transaction, and it would keep its name and Atlanta as its headquarters.
Delta started as a pioneer of crop-dusting, battling the boll weevil, and grew into one of the world's largest airlines.
St. Paul, Minn. — Delta Air Lines is a major global player. The carrier and its regional partners fly to hundreds of destinations in 52 countries. Last year, Delta had a revenue of $19 billion.
But the company has much more humble origins. It started with a handful of single engine planes and a crop-dusting operation.
It's a history that's laid out in the Delta Heritage Museum, located in a big former maintenance hangar at the airline's headquarters in Atlanta.
As curator Tiffany Meng explains it, in the 20's, a bug called the boll weevil was the scourge of southern cotton farmers. An agriculture specialist and bug specialist teamed up to do something about it through crop-dusting, which was a novel idea at the time.
"And one of the guys that was involved with that project actually went on to become the founder of Delta Airlines," Meng said.
The guy Meng is talking about is C.E. Woolman. In 1928, he bought out the crop-dusting division of the company where he was working and started a new company. He named it Delta Air Service, a nod to the Mississippi Delta region where it did business. The company was headquartered in Monroe, Louisiana.
Delta carried its first passengers in 1929. Meng points to a little black and orange five seater plane in the museum and said it's representative of what they were flying back then.
She opens the door to show the wicker seats inside and explains how delicate the whole construction is.
"It's very easy to damage, if you poke a hole in the side of the plane," Meng said. "Early aviation was just fabric -- fabric over metal frames. And that's what this is."
Over time, those tiny little planes gave way to big jets, and Delta eventually shed its crop-dusting business, though it did keep running until the 60's. And along the way, the company left Louisiana for a new home in the South.
Delta relocated to Atlanta in 1941, and it grew with the city. Jeffrey Rosensweig, a finance professor at Emory University in Atlanta, said it's hard to know whether Delta made Atlanta the major city it is today, or if it is the other way around.
"There was a time when Atlanta was not the hub for the Southeast. In fact, Birmingham, Alabama, could make that claim as well as anyone else," Rosensweig asserts. "But then with foresight, Atlanta built Hartsfield Airport, and Delta was a small, regional carrier. And then the two of them moved hand in hand."
That continued, Rosensweig said, to the point where the airport clinched the title as the world's busiest. Atlanta flourished as the capital of the South, and Delta became one of the world's biggest airlines.
Delta fed its own growth through a series of mergers and acquisitions in the wake of airline deregulation in the late 1970's. Deregulation loosened federal control over ticket pricing and routes that led to intense competition and turmoil in the industry. Some companies were forced out of business.
And as the industry consolidated, Delta was strong enough to be a buyer. In 1987, Delta acquired Western Airlines, which provided key routes to the West. In 1991 Delta purchased Pan Am's East Coast shuttle operation and its transatlantic routes, which played a big role in establishing Delta's current position of strength across the Atlantic.
Over the years, Delta established a reputation for good service. And Delta enjoyed another competitive advantage: relatively strong labor relations. Delta has only one union on its property: the pilots union. That contrasts sharply with the other big legacy carriers, such as Northwest, which are heavily unionized.
Some experts say Delta's comparative lack of unions is due in part to anti-union sentiment in the South. But Delta spokesman Anthony Black chalks it up to company culture.
"People felt this company treated them like family, and that has extended throughout the years, and even today, while the culture may have changed because the business changed, I think a lot of people think there's still the charm that existed back when C.E. Woolman was running the company," Black said.
Not everyone at the company shares that view.
"To say that in my 16-and-a-half years that I ever worked for that old fabled Delta, I'm not sure," said Delta Flight attendant Mark Stell.
Stell may be a sign that the culture at Delta is changing.
Stell is trying to organize a union for Delta's flight attendants. Similar efforts in the past have failed, but this one appears to be gaining some traction.
Stell said there are important remnants of the old culture: Delta does try to foster teamwork and a sense of inclusion. But he said workers need protection after 6,000 of them lost their jobs before and during Delta's bankruptcy. (The company filed for Chapter 11 protection on the same day as Northwest in 2005.)
Stell said after cuts like that, he has no illusions about the company operating like a "family."
"I know a lot of people who want to remember it that way, but it's been a long time since Delta has been the company of its fabled lore," he said.
Pilot Mike Stark is nostalgic about the old Delta, but he too complains that it's changed.
In bankruptcy, Delta terminated its pilot pension plan. The pilots' union signed off on the move. But Stark found it deplorable, and he said past Delta leaders would not have gone so far.
"That plan could've easily been saved, and I often ask the question, if C.E. Woolman or Dave Garrett were still on the property or even Ron Allen, would the pilots have lost their defined benefit plan?" Stark asks. "I don't think so."
If workers were frustrated about how they were treated in bankruptcy, some travelers were, too.
Baggage handling complaints have been up, since even before bankruptcy.
At the Hartsfield-Jackson Atlanta International Airport, frequent flyer Ralph Singer said he switched to a Delta rival for a while because of his dissatisfaction with Delta's service in bankruptcy.
"I just thought the service level was pretty poor," he said. "They've lost my luggage several times, and they weren't very accommodating about getting it back."
And like many other travelers, Singer thought worker morale sank during bankruptcy.
"I don't know if they were disgruntled, but I'll say that's at least how it came across."
But workers rallied behind Delta when US Airways attempted a hostile takeover. Delta fended off the bid and emerged from Chapter 11 protection about a year ago.
Since then, there have been more changes. Richard Anderson, the former CEO at Northwest, took the helm at Delta a few months after it emerged from bankruptcy. Many analysts believed the move foreshadowed a merger between Delta and Northwest.
And Delta has tried to respond to customer concerns about cost cutting in bankruptcy, when creature comforts like in-flight snacks were dropped. Delta put in new leather seats on planes, got a top fashion designer to design flight staff uniforms, and started using a new in-flight safety video set to a techno beat.
Moving forward, Delta is trying to ramp up its lucrative international flying, with an aim of bumping it from a third of the company's business to a half.
Spokesman Anthony Black said the carrier is focusing on pioneering new routes.
"We look to use our aircraft in markets where we can establish ourselves as first-market movers," he said, "such as India, Africa, and the Middle East."
Part of the goal, Black said, is to retain passengers already flying Delta in the U.S., and keep them onboard for travel to international destinations, far beyond where any little crop-duster ever could fly.
- Morning Edition, 03/10/2008, 7:50 a.m.