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Airlines

President Bush Defers to National Mediation Board in Northwest Airlines Strike

Strategic Insights

— 1 min read

President Bush has decided not to intervene in the impending strike by Northwest Airlines mechanics, deferring to the National Mediation Board's finding that the work stoppage would not substantially disrupt interstate commerce. This decision marks a reversal of Bush's actions in 2001, when he delayed a planned strike by Northwest mechanics for 60 days. The mechanics are seeking $1.1 billion in annual labor savings, with Northwest President & CEO Doug Steenland estimating that the company must reduce labor costs by 30% to remain competitive.

Key Takeaways:

  • The National Mediation Board has found that the work stoppage would not substantially disrupt interstate commerce, paving the way for the strike to proceed.
  • Northwest Airlines is seeking $1.1 billion in annual labor savings, including $176 million a year from the mechanics.
  • The strike is set to begin at 12:01 a.m. on Saturday, with the mechanics poised to walk out after a 30-day cooling-off period.
  • The Aircraft Mechanics Fraternal Association (AMFA) claims that up to 40% of replacement mechanics recruited by Northwest cannot pass the airline's own skills test.
  • Northwest spokesman Kurt Ebenhoch disputes this claim, stating that all replacement mechanics meet FAA requirements and Northwest standards.
  • The contract proposed by Northwest would eliminate 53% of mechanic jobs and cut pay by 26% for those remaining.
  • Mechanics who survive previous job cuts are senior employees making $70,000 or more annually.

Statistics:

  • 12:01 a.m. ET on Saturday: the strike is set to begin
  • 30 days: the cooling-off period that has expired
  • $1.1 billion: the annual labor savings sought by Northwest Airlines
  • $176 million: the annual labor savings sought by Northwest from the mechanics
  • 53%: the percentage of mechanic jobs that would be eliminated under the proposed contract
  • 40%: the percentage of replacement mechanics that the AMFA claims cannot pass Northwest's skills test
  • $70,000: the annual salary of senior mechanics who survive previous job cuts

Sources:

  • White House Deputy Press Secretary Dana Perino
  • USA TODAY
  • National Mediation Board
  • Aircraft Mechanics Fraternal Association (AMFA)
  • Northwest Airlines
  • Federal Aviation Administration (FAA)

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