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Wed, Mar 29, 2006

Comair Faces Similar Problems As Parent Delta, Receives Similar Warning

Settle, Or Else: Part Two

The federal bankruptcy court may be hoping some tough love will help Delta Air Lines -- and now it's regional subisidiary, Comair -- to settle their respective differences with pilots and flight attendants. Aero-News reported last week on the strong words a federal arbitration board had for Delta management and its pilots union... and this week, it's Comair's turn.

Late Monday, the judge overseeing the Comair bankruptcy trial strongly urged Comair and its flight attendants to settle their differences... or face the inevitable consequences.

"I have a sense of wonderment that either side is interested in having the court decide this matter, although I stand ready to," US Bankruptcy Judge Adlai Hardin said after hearing that Comair could be forced to shut down without $8.9 million in annual cost cuts -- and, that the flight attendants union could strike if he voids its contract.

"From what I hear from both sides, neither alternative is very good," Hardin added. "This is not a situation where I can split the baby... and there is very little time before the end of these proceedings and my ruling."

Hardin has until April 10 to reach a solution on the matter -- although he also warned both sides that he is "disposed to do that much sooner," according to the Cincinnati Enquirer.

Comair, a wholly-owned subsidiary of Delta, filed for bankruptcy on the same day its parent company did -- September 14, 2005. Proceedings during its bankruptcy trial have mirrored those of Delta in many ways... including similar levels of animosity between management and its workers.

Officially, both management and the flight attendants say they're willing to keep talking... but many issues remain -- including Comair's refusal to guarantee jobs, in exchange for employee concessions.

"Are we still willing to talk? Yes," Teamsters national representative Victoria Gray said Monday. "We would rather not be here at all. But on the key points we are looking for, we don't even have a starting point because the company refuses to broach the subject."

Comair spokeswoman Kate Moser replied the company was willing to keep talking, but job protection was not an item the company was considering in its proposed agreement.

"A restructured Comair is the best job protection the company can offer," she said -- a sentiment echoed by the airline's counsel.

"If Comair cannot restructure... it will not survive long term," Comair lawyer Robert Span said in his opening statement for the three-day hearing. "The simple reality is that air travel has become a commodity market, and... only the companies that can compete on costs will survive."

FMI: www.comair.com, www.delta.com, www.teamsters.org

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