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Northwest shares jumped 28 cents, or 5.2%, to $5.66 on Monday, as Wall Street applauded the company's cost-cutting action.
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"These are licensed mechanics," Boyd said of the replacements. "The operation is as safe as it was five days ago." He said sky-high fuel prices give Northwest and its major competitors little choice but to look to labor to trim costs. And once that's accomplished, the majors should finally be primed for a long-awaited round of sales and earnings growth.
Northwest is paying the replacements an average of $26.53 an hour--about 20% less than its unionized workers. It's looking for the mechanics, cleaners, and custodians to be a source of $176 million in labor givebacks, about 20% of the total it's targeting.
AMFA members are walking the picket lines without the support of pilots and flight attendants, who belong to unions that experts say have a better grasp on the realities of bargaining against the backdrop of looming bankruptcy. The pilots' union has already agreed with Northwest on a 15% wage cut.
"Pilots understand that bankruptcy means their pension is gone," Boyd said.
Others underscored the power-sharing arrangement among labor groups that work for airlines, an industry whose workers are divided into several unions.
"That makes it difficult for any one of them to wield much influence; it's easier for a company to play one off against another," said labor expert Ken Jacobs, deputy chair of the Cal-Berkley Research Center. He said AMFA's 1998 decision to break off from the International Association of Mechanics--part of the AFL-CIO--clearly backfired.
"This is when they could have used more solidarity," Jacobs said. And with Northwest's strategy being watched closely by others, its ability to break the mechanics' union figures to spur more cost savings for airlines and fewer union jobs for workers.
"This could have big repercussions," Jacobs said.
Some interesting pieces from the article:
Northwest shares jumped 28 cents, or 5.2%, to $5.66 on Monday, as Wall Street applauded the company's cost-cutting action.
----
"These are licensed mechanics," Boyd said of the replacements. "The operation is as safe as it was five days ago." He said sky-high fuel prices give Northwest and its major competitors little choice but to look to labor to trim costs. And once that's accomplished, the majors should finally be primed for a long-awaited round of sales and earnings growth.
Northwest is paying the replacements an average of $26.53 an hour--about 20% less than its unionized workers. It's looking for the mechanics, cleaners, and custodians to be a source of $176 million in labor givebacks, about 20% of the total it's targeting.
AMFA members are walking the picket lines without the support of pilots and flight attendants, who belong to unions that experts say have a better grasp on the realities of bargaining against the backdrop of looming bankruptcy. The pilots' union has already agreed with Northwest on a 15% wage cut.
"Pilots understand that bankruptcy means their pension is gone," Boyd said.
Others underscored the power-sharing arrangement among labor groups that work for airlines, an industry whose workers are divided into several unions.
"That makes it difficult for any one of them to wield much influence; it's easier for a company to play one off against another," said labor expert Ken Jacobs, deputy chair of the Cal-Berkley Research Center. He said AMFA's 1998 decision to break off from the International Association of Mechanics--part of the AFL-CIO--clearly backfired.
"This is when they could have used more solidarity," Jacobs said. And with Northwest's strategy being watched closely by others, its ability to break the mechanics' union figures to spur more cost savings for airlines and fewer union jobs for workers.
"This could have big repercussions," Jacobs said.
