Where Do We Go From Here?

[nwa400]

Hey all. Just a question that will spark interests. What is the thought concerning IAM/F/A's negotiations? Will NWA sink with "NO PAY UNTIL THE LAST DAY" attitude? Does the Co. really need those cuts? Will employees live to fight another day? Will the low cost carriers really do what they set out to do and sink all legacy carriers by lowering the wage scale so much that others cannot compete? Will NWA get bankruptcy wages for nothing? I feel the tention starting to build........just remember ..........these are questions........! Dont stomp on me for getting some conversation going here. :unsure:

 

[Bigsky]

For NWA to return to a profitable airline once again it will take some sacrifice from all unions. Hopefully other unions, besides the pilots, will step up to the plate before it is too late as the "full pay to the last day" attitude probably won't kill the airline but will expedite NWA into Chap 11. In Chap 11, it's anything goes. United Airlines wages and work rules would most likely be at our doorstep. That would suck!!!!!!

In addition, without some legislation from congress dealing with our 4 billion dollars in underfunded pensions, NWA will be in Chap 11 in less than two years. That you can count on.

Happy Flying

bigsky

 

[Bigsky]

Speaking of pension reform....this will help NWA in a big way!!!!! Source: Northwest Airlines


Northwest Airlines Supports Pension Reform Legislation Introduced in U.S. Senate
Wednesday April 20, 6:03 pm ET
- Bill Would Help Protect Taxpayers and Workers With Pension Benefits


MINNEAPOLIS, April 20 /PRNewswire-FirstCall/ -- Northwest Airlines (Nasdaq: NWAC - News) today announced its support for legislation introduced by U.S. Sen. Johnny Isakson (R-Ga.) and co-sponsored by U.S. Sen. Jay Rockefeller (D- W.Va.) to reform how companies pay the unfunded liabilities of their frozen defined benefit pension plans. The "Employee Pension Preservation Act of 2005," which was introduced in the U.S. Senate today, will allow companies to fully fund their frozen defined benefit pension plans over a 25-year period versus the three-year "catch-up" requirement in place today.
"Northwest is in strong support of the bill introduced by Sen. Isakson and co-sponsored by Sen. Rockefeller and we thank them for their leadership on this issue," said Andrea Fischer Newman, senior vice president of government affairs. "This legislation will help protect airline employees from losing any of their hard-earned pension benefits and help protect taxpayers from even more pension plans becoming the responsibility of the Pension Benefit Guaranty Corporation (PBGC)."

Northwest's low-cost carrier competitors, such as Southwest, JetBlue and AirTran, provide their employees with less expensive defined contribution plans such as 401(k)s. Northwest, a company that was providing air service and pension benefits long before 401(k)-style plans ever existed, is one of just five remaining U.S. airlines that provide its employees with defined benefit plans.

Northwest's pension plans were fully funded as recently as 2000. However, as a result of four consecutive years of falling interest rates, major stock market declines during 2000 through 2002, and increasing employee pension benefits, the company's pension plans are now underfunded. In addition, the law governing pension funding requires highly accelerated "catch-up" payments when a plan is underfunded. These catch-up payments are particularly onerous in the current environment as nearly all U.S. airlines struggle to return to profitability and cannot afford to make such contributions.

Some of Northwest's largest competitors have terminated their defined benefit contribution plans through the Chapter 11 bankruptcy process, turning responsibility for the plans over to the PBGC, a self-financed governmental corporation that partially insures failed pension plans. The PBGC recently reported a record deficit of $23 billion, which includes the cost of taking over pension plans at United Airlines and US Airways. The PBGC predicts a $40 billion deficit if other airline pension plans are terminated.

Northwest, the Air Line Pilots Association (ALPA) and several other airlines are working together to develop a solution to this challenge. The legislation will allow Northwest to achieve the second part of its three-part, long-term solution to the pension challenge it faces:


-- Receiving union concurrence to freeze defined benefit plans at current
levels rather than terminating the plans.
-- Making up the funding shortfall of the frozen plans over a longer
period than current law allows.
-- Establishing a defined contribution 401(k) retirement plan, to provide
secure employee pension benefits going forward.


"The legislation introduced today will allow companies such as Northwest to fully honor the pension commitments made to employees and spare taxpayers, through the PBGC, from having to step in as guarantor of terminated pension plans." Newman continued. "This responsible solution, embraced by management and labor, is a far superior alternative to the job losses, substantial reductions in pension benefits and increase in airline bankruptcies that will inevitably occur if action is not taken soon."

Northwest Airlines is the world's fourth largest airline with hubs at Detroit, Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and approximately 1,500 daily departures. Northwest is a member of SkyTeam, an airline alliance that offers customers one of the world's most extensive global networks. Northwest and its travel partners serve more than 900 cities in excess of 160 countries on six continents.

 

[nwa400]

Thanks for the reply BigSky........

I guess the 80$ a share I was waiting on to sell my stock is not going to happen. Bummer! Should I sell now at $5.15?

 

[javaboy]

Boys and Girls,

this is free, (remember you get what you pay for...) I have many friends at all the airlines, the song is the same (by managment) the results are begining to mimic each other. a methodical ratcheting down of employee benefits, wages and headcount has been continual, as one CEO put it shortly after 9/11 no we don't need all these cuts, but this is our once in a lifetime chance to wipe the slate clean.... that may or may not be the case for NWAC.

I would encourage all of you in the strongest terms to talk to as many people as you can at carriers like UAIR and UAL to start with ATA HAWAIIAN as well ( thats the short list of CURRENT bankrupt airlines)

few things there is not going to be if we take this cut it will help and thats all we have to take right? there will be rounds 2 and 3 until the final goal is achieved.
Protect your pensions at all costs, up to and including FREEZING it or if UAIR pilots had volunteraily terminated their pension BEFORE the judge did. guess what those funds would have reverted to the pilot group for distrubtion which would have netted roughly 70% of promised benifits. instead of the PBGC maximium around 15% of promised benefits.

So just saying talk to those IAM/ALPA/or insert your union here and find out now, what they could have done differently to alter what result they currently have to endure.

That's all i'm saying seek out those that have had to go down the road before you and ask them of thier situation. (no NWAC nor DAL nor CAL are any different than UAIR or UAL) i did not say AMR because fiscally they are managing it better than the rest.

Good luck to you all.

(ps at this point redbook/green book aint gonna matter)