The merged Delta-Northwest: Smooth flight

  • Article by: SUZANNE ZIEGLER , Star Tribune
  • Updated: October 14, 2009 - 9:29 AM

Airline mergers often are hard for passengers, but the Northwest-Delta pairing has been nearly seamless.

Former Northwest Airlines employee, now Delta employee, Lynda Burkel, helped Moya and Graham Thompson check in at MSP for their flight to Winnipeg.

Photo: Glen Stubbe, Star Tribune

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Historically, airline mergers are turbulent and frustrating for the workers, management and, especially, the consumers.

But nearly one year after Northwest and Delta merged to form the world's largest airline, experts are describing the merger as "smooth," "historically quiet" and one that learned from the industry's past mistakes.

Travelers' grumblings have been relatively quiet, limited mainly to the switchover from the WorldPerks to Delta's SkyMiles program and some confusion when it comes to checking in at the airport. But overall, they say the transition has been close to seamless -- and for some, an improvement.

"The quality of the first-class cabin has increased a lot under Delta. The seats have been leatherized, the food is a notch better. ... I know things are going to be good," said Jim Balabuszko-Reay, a health care information technology consultant with Aspen Advisors.

As a chauffeur who shuttles corporate clients to and from Minneapolis-St. Paul International Airport, Hale Meserow of Eagan hears plenty of opinions from travelers from across the country. "The impression is that Delta is a better airline, or that the combined group is trying to address [service] and trying harder," he said.

Integrating the airlines is taking $500 million and more than two dozen teams to pull off at a time when the airline industry is already grappling with a significant slowdown in air travel because of the recession.

Travel experts chalk up the smooth transition to several factors, including the airlines' abilities to pull the best from Delta and Northwest, a timeline that allowed changes to be phased in, meticulous planning and the efforts made to avoid mistakes made in previous mergers.

"They worked very hard to alleviate the potential for disruption that can occur when you're putting two companies together," said Bill Swelbar, who analyzes airline mergers at the Massachusetts Institute of Technology. "I think they paid an awful a lot of attention to history and what went wrong at others."

That includes the divisive 1986 merger of Northwest and Republic Airlines, the industry's biggest merger at the time. Aggravated passengers lost their bags and their confidence in Northwest and embittered union employees battled for years to resolve pay and seniority issues.

"There are still people who are waiting for their bags," from that merger, joked Minneapolis travel expert Terry Trippler, who called the Northwest-Delta merger "an extremely smooth transition" for travelers.

What he's heard: Some on-again, off-again complaints about the frequent- flier programs, which just consolidated under Delta's SkyMiles program. "Some people are going to like it better, others aren't. So that's normal." Others have complained about the credit card battle between American Express and Visa for the WorldPerks customers.

Randy Peterson, an expert on frequent-flier programs and editor of Inside Flyer magazine, praised Delta and Northwest for letting customers merge their accounts incrementally and for providing bonuses to those who did it early. In other mergers, the airlines just said: "Hey, we're merging accounts today and we'll do our best to match up databases."

Steve Loucks of Eden Prairie-based Travel Leaders, which has about 1,500 travel agencies across the United States, cited the "gradual process that hasn't hit you over the head. The fact that they haven't turned off Northwest immediately and done everything as Delta has enabled the frequent fliers to enjoy a smooth transition," he said.

And frequent travelers notice the smaller changes, what Loucks called the "light touches."

"The in-flight magazine for example is dramatically better than what it had been. The leather first-class seats are definitely a big upgrade from what the frequent fliers had experienced before," he said. "Those seats also translate to coach. So it's not just up in front, it's throughout the aircraft."

The in-flight magazine, called Sky, is produced in Minnesota by MSP Communications. Model Heidi Klum graced its premier edition; a hip-looking Tyra Banks is on the cover of September's.

Red Tails on the way out

About half of the 300 Northwest planes that Delta inherited have been repainted and are getting face lifts inside as well: leather seats throughout and new carpet.

For Minnesotans, it means that Northwest's eight decades of "Red Tail" history is slowly fading out: The former Eagan headquarters went up for sale or lease last week, NWA.com will disappear early next year and the red tails now carry Delta's red and blue logo.

"We've done a lot of work over the last 11 months, but we still have a lot of work to do," said Bill Lentsch, Delta's senior vice president for Minnesota operations. "As the economy continued to go south, it became more and more apparent that we made the right decision to bring these two airlines together.

Among what's left on the "to do" list: joining both airlines' operations under a single Federal Aviation Administration certificate, expected by the end of the year.

Lentsch also said that Delta employs about 13,000 people in Minnesota; Delta agreed to keep 10,000 jobs in the state through 2016. The bulk of transfers to Atlanta have taken place, he said, "although there will be some movement into next year." Minnesota employees will be consolidated by early next year in a building near the airport that's being renovated, he said.

Delta said about 8,000 jobs at both airlines have been cut since spring 2008, most via voluntary programs. It did not have a breakdown for how many were lost in Minnesota alone.

On Thursday, Delta CEO Richard Anderson said the airline has completed the move of Northwest's operations control center to Atlanta.

On the union front, representation and seniority list integration has been resolved for pilots of the two carriers and for several other work groups. But they remain unresolved for the two biggest: flight attendants and ground workers.

Impact: Skewed by economy

Consumer advocate Kate Hanni said she's been hearing complaints about Delta and other airlines, often from people who started out with a direct flight but had it changed. "They called and said that flight has been canceled so they're putting me on a connecting flight going to Timbuktu and around, a circuitous route. It's going to take me 12 hours to get to where it used to take six," said Hanni, the executive director of the Coalition for an Airline Passengers' Bill of Rights.

But she said it's often the economy, not necessarily the airline, that's to blame.

U.S. airlines have been cutting back on flights for the past two years, matching the falling demand for air travel. Delta has said it expects to reduce domestic capacity 8 to 10 percent this year compared with 2008.

Less capacity means consumers will be left with fewer flights to choose from and planes will be crowded. Fewer seats normally means higher fares but that might not happen this time unless the economy begins a true recovery and passenger traffic picks up.

"These are not normal times to judge the merger's impact in the past year, we really can't tell for sure because of the economic situation and the cutbacks and the capacity reductions, etc." Trippler said. "I think for the MSP-area traveler, it has probably gotten off to a good start."

One postmerger concern was whether Delta would cut routes to smaller communities. But the company said capacity reductions have been handled largely through frequency and the use of smaller aircraft, with only a "small handful" of communities losing service altogether, none in Minnesota.

Swelbar, the MIT analyst, said the role of Anderson, a former Northwest chief executive, has been crucial.

"Anderson at the helm provided tremendous dividends. He was learning his new company, but he also knew Northwest," he said. "If one was going to present some sticky issues, it was going to be Northwest."

Swelbar also said the merger gave the airlines a chance to get a fresh start and fashion what they envisioned and answer the question: "How do we want this new company to be presented to the world?"

The Associated Press contributed to this report.

Suzanne Ziegler • 612-673-1707

  • WHAT'S NEXT

    By the end of this year:The two become one: a single operating certificate expected to be issued.

    Early 2010:All seats and fares consolidated on Delta's reservation system so every flight becomes a Delta flight and NWA.com disappears.

    By end of 2010:All check-in and gate locations at all airports worldwide will be Delta.

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