Northwest cancellations: Will NWA be grounded?

Posted Jul 24th 2007 6:10PM by Kevin Shult
Filed under: Bad News, Consumer Experience, Competitive Strategy, AMR Corp (AMR), UAL Corp (UAUA), Delta Air Lines (DAL), Stocks to Sell

Since it came out of bankruptcy two months ago, Northwest Airlines (NYSE: NWA) has canceled a significant amount of flights because of a pilot shortage. Over 147 Northwest flights were canceled over the past weekend and more than 60 were canceled on Monday. By mid-day today, 30 more were grounded.

While these recent cancellations don't compare to the 1,000 flights that were cut in June, Northwest failed to meet the industry's target of 98.0% completed flights. The numbers are also worse than Northwest's rivals' performances. USA Today reported that Northwest's 76 cancellations Sunday totaled 5.6% of the day's flights. In comparison, American Airlines (NYSE: AMR) cut six flights, United Airlines (NASDAQ: UAUA) canceled 33 and Delta (NYSE: DAL) cut four. All provide more daily flights than Northwest.

The leaders of the Air Line Pilots Association said Northwest management laid off too many pilots during its reorganization and scheduled too aggressively coming out of bankruptcy to show better projections for revenue. A Northwest spokesman said the union warned management earlier in the year of the pilot shortages, but was ignored. USA Today said that management conceded that their schedules had been too aggressive, but they also noted an "unusually high rate of pilot absenteeism" in the second half of June.

Northwest management told the Detroit News yesterday that the company was able to get a significant majority of its flights off the ground, and most on time. Tell that to the people whose 60 flights were canceled.

While Northwest's canceled flights continue to pile up, some observers have started to question if the carrier will win its recent request to fly nonstop routes to China. The company was previously turned down for a Detroit-to-China route.

If Northwest doesn't quickly improve its situation, not only will it be on the losing end to China for a second time, but it risks losing its frequent flier and loyalty groups.

Tags: airline cancellation rates, AirlineCancellationRates, american, amr, dal, delta, flight cancellations, FlightCancellations, inthenews, northwest, Northwest Airlines cancellations, Northwest cancellations, NorthwestAirlinesCancellations, NorthwestCancellations, NWA, uaua, united

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Reader Comments (Page 1 of 1)

7-24-2007 @ 6:58PM

Alan S said...

I wouldn't be concerned with the pilot shortage doing damage to NWA's bottom line, Kevin. If anything, NWA has proved time and time again to rebound from troubled waters. Despite the tragic loss of former founder Eric Wright 12 years ago, NWA has made a dramatic comeback, hiring talented managers like Marshall Bruce Mathers III and Calvin Cordozar Broadus, Jr. to the board. Expect record high profits and a possible takeover of another major airline before the end of the fiscal year.

7-24-2007 @ 11:10PM

justpicky02 said...

IF YOU'RE SHORT OF PILOTS , THEN COMMON SENSE SAYS ....HIRE MORE PILOTS ...........

WHAT'S GOING TO HAPPEN IS ...CUSTOMERS WILL GO TO OTHER AIRLINES AND FORGET NWA.....

SO WOULD YOU RATHER LOSS CUSTOMERS OR WOULD IT JUST BE BETTER TO HIRE PILOTS ...

I KNOW I WAS ONE EVENING TAKING A FLIGHT OUT
HAD TO WAIT FOR A PILOT , CAN YOU BELIEVE THAT ........YOU WOULD THINK NWA WOULD PLAN THAT WEEKS OR MONTHS AHEAD OF TIME FOR SCHEDULING ....

YEP HIRE PILOTS AND STOP BEING SO DARN CHEAP ......DON'T GIVE THOSE CEO'S MILLION DOLLAR RAISES EITHER , THIS WAY , NWA CAN STAY IN BUSINESS ........