Remains Mum On Merger's Impact On Jobs
hand-wringing and suggestions of economic incentives, Minnesota
lawmakers have not been able to convince a merged Delta and
Northwest to keep the combined airline's headquarters in Eagan.
Even more frustrating, they haven't been able to find out how many
jobs will disappear in the merger... or even find out when
they'll find out.
The Associated Press reports Ed Bastian, Delta's president and
chief financial officer, told lawmakers in separate state House and
Senate hearings that while the headquarters will be in Atlanta, the
Minneapolis-St. Paul Airport will remain a hub. He said there will
be no involuntary reduction of "front line" Northwest customer
In response, lawmakers repeatedly -- and unsuccessfully --
pestered Bastian for more details about how many jobs at
headquarters would be lost and what other Northwest divisions might
be closed entirely. All Bastian would tell them was, "We are early
in the process of determining what corporate activities will be
combined and how they will be combined. Some of that work will be
done in Minnesota, some of that work will be done in Atlanta. We're
early in the process."
There's more at stake than the idle curiosity of state
legislators. Under financial agreements between Northwest and
Minnesota dating to 1992, the carrier could forfeit more than
200-million dollars in bond debt issued by the Metropolitan
Airports Commission, and another 200-million in airport rent
concessions, if it fails to keep its headquarters, a hub, and a
certain minimum number of employees in Minnesota through 2020.
Bastian says the company will negotiate its way out of the
headquarters requirement with Governor Tim Pawlenty's office in
exchange for maintaining some number of jobs and a hub in the Twin
Cities, but says the airline will buy its way out of the deal if
necessary. He hinted that if it comes to a buyout, all bets are
"I don't know if that's in anyone's best interests at this
point," he said.
Steve Gordon, president of the International Association of
Machinists union which represents Northwest ground workers,
predicted the merger will have a major impact. "I think people need
to start realizing this is going to have grave effects on the
communities where Northwest employees live," Gordon said. "Not just
on the employees -- on the communities."