OP
North by Northwest
Veteran
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- #31
NWA has been to it's employees for concessions more times than you can shake a stick at...believe me, they don't need a new airplane to ask again. They aren't shy about that kind of stuff. They have asked. They will ask... again, with or with out a new jet. I personally think that it is just a matter of time before all airline employees (no matter what company) nolonger find it a desirable industry to be involved in. The perks vs. the dangers are rapidly fading... 
I predict NWA employees WILL offer concessions...mostly on THEIR terms. "The UBS analysts wrote that it's likely Northwest will use bankruptcy brinkmanship with its unions as had AMR Corp.'s American Airlines in 2003 and Delta Air Lines in 2004. The effect was to send the shares of both companies lower at the time.
The airline earlier this year increased its annual labor cost cutting target to $1.1 billion from $950 million.
But Prudential Equity Group analysts called out the UBS note and said they disagreed with the bank's take.
"[Northwest] is seeking labor concessions, but will likely complete the negotiations over the course of 2005 in a positive and informed basis," wrote Prudential analysts. The Prudential analysts wrote that they did not expect the carrier to try to threaten its unions with talk of Chapter 11.
Notably, Prudential added, the company has been working on its debt deals. "If bankruptcy threats were a part of the process, access to credit markets would not be part of the picture," Prudential wrote.
Northwest declined to comment.
Northwest (NWAC: news, chart, profile) stock fell 77 cents to $6.14 as the broader sector sank. See full story. The Eagan, Minn. company's shares are down 37 percent so far this year.
All airlines are under intense pressure to hold down costs as jet fuel prices flirt with record levels. Despite workers, including non-union employees and executives, giving up benefits and pay, the red ink continues to mount throughout the industry as fuel expenses keep on rising. Man...remember the good ole days when we used to just fight on here about who had the best service...
Now, it's more like who's gonna reach the bottem first. :down:
I predict NWA employees WILL offer concessions...mostly on THEIR terms. "The UBS analysts wrote that it's likely Northwest will use bankruptcy brinkmanship with its unions as had AMR Corp.'s American Airlines in 2003 and Delta Air Lines in 2004. The effect was to send the shares of both companies lower at the time.The airline earlier this year increased its annual labor cost cutting target to $1.1 billion from $950 million.
But Prudential Equity Group analysts called out the UBS note and said they disagreed with the bank's take.
"[Northwest] is seeking labor concessions, but will likely complete the negotiations over the course of 2005 in a positive and informed basis," wrote Prudential analysts. The Prudential analysts wrote that they did not expect the carrier to try to threaten its unions with talk of Chapter 11.
Notably, Prudential added, the company has been working on its debt deals. "If bankruptcy threats were a part of the process, access to credit markets would not be part of the picture," Prudential wrote.
Northwest declined to comment.
Northwest (NWAC: news, chart, profile) stock fell 77 cents to $6.14 as the broader sector sank. See full story. The Eagan, Minn. company's shares are down 37 percent so far this year.
All airlines are under intense pressure to hold down costs as jet fuel prices flirt with record levels. Despite workers, including non-union employees and executives, giving up benefits and pay, the red ink continues to mount throughout the industry as fuel expenses keep on rising. Man...remember the good ole days when we used to just fight on here about who had the best service...
Now, it's more like who's gonna reach the bottem first. :down:
