Business

Delta- Northwest merge
by Claudia Sonea

The increased oil prices and an economy on the verge of recession determine all kind of mergers in order to avoid bankruptcy. On Monday, after many months of rumors and speculation Delta and Northwest executives announced that by the end of the year they will merge creating the world's largest airline. In spite of lawmakers contesting the legitimacy of the deal, the Congress cannot stop it and the only issues remaining are mostly administratively and of labor relations. First issue on their list is relationships between management and workers. If Delta has a close relation with its workers, Northwest has a history of troubles with them and many strikes. Therefore it was not at all surprising that Northwest heavily unionized workers opposed the merger and they can pressure enough the shareholders and regulators to prevent it. Yet, they left room for a possible acceptance if it will offer them some satisfying contracts. Both airlines offered pilots joint contract and seniority beforehand. Delta pilots signed a deal during the weekend that gives them 3.5 percent of the new company, while Northwest pilots opposed arguing that unless their contracts won't be changed, the new airline cannot shift to new routes. Northwest CEO Doug Steenland assured the workers interests will be protected and that it will take a combined contract for everything to go smooth. The statement was reinforced by Ed Bastian, Delta's chief financial officer. If the deal goes through the new airline will be called Delta, will be run by Anderson, Delta's CEO, and it will have 1400 planes (12 main jets), thus the fleet will be an advantage for matching with certain routes and planes. Mostly the deal would benefit Delta and up to this point, only its pilots can rest assured about future contracts.

related story: http://news.yahoo.com/s/ap/20080415/ap_on_bi_ge/delta_northwest;_ylt=Arp723MMJzY73HSGdAU4KZus0NUE

by Claudia Sonea for PocketNews (http://pocketnews.tv)

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Edited by: Maria Zitnanska

Labels: Business, CantellTV, Chris Cantell, Christopher Cantell, digital broadcasting, SigEx Foundry, SigEx Telecom

posted by Blog TechSource @ 1:27 AM