October 31, 2008, 9:10 am
Five Issues Delta-Northwest Marriage Could Face
Posted by Matt Phillips

It’s well established that airline mergers aren’t always smooth affairs. Here are five things that the executives tasked with creating a “new” Delta out of the Atlanta-based carrier and Northwest have likely been considering for months — and why travelers should care.

Reservation glitches: Merging hundreds of routes and reservations is no easy task. It took quite a while for US Airways, which merged with America West back in 2005, to straighten out its schedule.

Back in October 2007, Scott wrote a column in which US Airways CEO Doug Parker said some issues arose as a result of an effort to unify US Airways and America West’s reservation system. “Reservations were lost, flights were delayed and many customers fumed in long lines. For many months, US Airways had two separate check-in lines depending on whether your reservation was made through the old US Airways system or the America West system,” Scott wrote.

Pilot issues: In past mergers, seniority integration has been a major sticking point leading to litigation and years of bad feelings. (Seniority determines pay and schedules for pilots.) Some Northwest pilots have been around long enough to remember the hostility that followed that carrier’s 1986 acquisition of Republic Airlines. The deal doubled Northwest’s size, but the integration led to months of lost baggage and years of worker infighting. Senior pilots at the airline still identify themselves as “red book,” meaning they were covered by the old Northwest contract, or “green book,” Republic’s contract. Why should you care? Well, back in 1999, after American Airlines acquired tiny Reno Air, an integration dispute triggered an illegal pilot sickout that disrupted travel nationwide for 11 days. As Susan Carey and Paulo Prada wrote in the Journal, this is one issue in the Delta/Northwest tie-up that isn’t yet resolved. But Delta’s 6,000 pilots and Northwest’s 5,000 already have voted for a common labor contract and agreed to abide by an arbitrator’s ruling if they can’t agree by next month.

Cranky Workers: Poor customer service has been a problem with airline mergers before. Generally speaking, the ongoing uncertainty of mergers can sap employee morale. (After all, one rationale behind combining two airlines — cost savings — often translates into job cuts.) The list of potential merger problems can seem endless. For instance, during the US Airways/America West integration, one sticking point was how empty seats on flights were given to employees. America West employees got to ride in empty seats on a first-come, first-served basis, while US Airways, employees got seats based on seniority. While this might seem like inside baseball, all these issues play a role in employee attitudes, and consequently, passengers’ experience with those employees.

Generalized confusion: As Northwest joins Piedmont, AirCal, Republic, and Mohawk in the great airline-brand scrapyard in the sky, it’s crucial that the “new” Delta makes it clear which airline’s terminals, gates and check-in counters will be in use for customers. It sounds simple, but sometimes airlines can take an extremely long time to iron this stuff out. In a November 2006 column, Scott wrote how Delta’s terminal at New York’s Kennedy was still waiting for full merger integration 15 years after Delta bought Pan Am’s European business, making Delta’s Kennedy operations confusing — even for some cab drivers.

The false start: After airlines merge, it often takes awhile before they’re ready to enact major changes in operations and procedures. Again, the US Airways/America West deal may serve as an example. The integration of the two started off smoothly but ran into large operational snags — poor on-time and baggage handling, people stranded at airports — that inconvenienced customers. (It’s important to note, however, that US Airways has made big strides in straightening most of them out.)

That said, there are plenty of reasons to believe that the integration of Delta-Northwest will be less rocky than other airline marriages. For one, Delta’s CEO Richard Anderson — who will lead the combined carrier — has been in charge of both companies, which may give him special insight into how the two cultures will blend.

Readers, we know many of you are airline experts. What other unexpected bumps lie down the road?