Monday, August 20, 2007

Northwest Airlines 15 Minute-Time



The nation's fifth-largest airline by traffic [Northwest] is taking steps to ensure that it is able to operate reliably in the future, Mr. Steenland [the CEO] said. One important component is a new tentative agreement with its pilots union that would reinstate time-and-a-half premium pay if the pilots fly more than 80 hours a month.
—The Wall Street Journal, August 4, 2007.


“The mechanic doesn’t have the right tools to fix the problem, so they’re going to have to fly a mechanic in with the right tools. This flight is postponed indefinitely. Please come to the ticket counter and we will help you find alternatives.”

—Northwest Airlines ticket agent, Pellston MI, August 17, 2007.


While the CEO of Northwest Airlines—advertising slogan “We Haven’t Been Bankrupt Since May!”—was telling the Wall Street Journal about his plans to make the Northwest pilots feel better about showing up for work, he neglected to discuss what he was doing to perk up the mechanics who help the planes get off the ground, not to mention the flight attendants who actually interact with the paying customers.

I bring this up because less than two weeks after Mr. Steenland’s mea culpa to the press and his declaration of a fresh new start at the old Northwest, we here at NotMakingThisUp ran into the same old problems with the new Northwest that we seem to have every summer on the way to our annual mid-west vacation along the upper reaches of Lake Huron.

Now, when I am asked by people on the East Coast why we vacation in Northern Michigan in the first place, it’s as if I'd said we were going to Jersey City, say, or Elko, Nevada—no offense to either place.

In the minds of East-Coasters who, if they think of the Great Lakes at all, think of the industrial waters of Lake Erie rather than the vast, clear waters of Lake Superior or Lake Huron, the word “Michigan” conjures up images of shuttered Ford factories and poverty-stricken Detroit, not dune-covered shorelines and crisp, cool summer nights with late sunsets and dramatic moon-rises over quiet pine woods.

And that’s fine with me, because a week away from the getting and spending of the “two-and-twenty crowd”—as Warren Buffett calls the hedge fund quant wizards whose antics nearly brought the financial world to its knees early this month—does wonders for the mind and soul.

The trick, of course, is getting there and back without undue stress, which has proven nearly impossible given the fact that Northwest Airlines, despite having been run by leveraged buyout artists and taken into bankruptcy in 2005, still has a lock on the small airports of the Upper Midwest.

This means that if you want to fly from somewhere on the East Coast to somewhere in Minnesota, or somewhere in Michigan, or somewhere in Indiana, chances are good that at least one leg of your trip will require you to fly on Northwest.

By “to fly on Northwest,” of course, I mean “to be trapped on a grounded plane for extended lengths of time in between long periods in a holding pattern.”

In fact, our most recent trip on Northwest was our third consecutive summer trip disrupted by both the weather and the seeming inability of Northwest to get its act together, which I believe is a legacy of Northwest's heritage as one of the first leveraged buyouts in the airline business.

Any time somebody wants to tout the merits of private equity, tell them to fly Northwest.

Weather disruptions, for example, shouldn't be a big deal for an airline—after all, the entire airline industry pretty much operates in weather—except that Northwest apparently hires only those human beings who have lost the ability to speak with regular human beings as opposed to airline-related individuals.

Curious about the holding pattern you've been in for a half hour? Wondering about the mechanic scratching his head out on the tarmac? Anxious about whether you'll make the connecting flight?

The rule on Northwest appears to be, if you don't ask, they won't tell you.


Furthermore, Northwest operates on a unique time system I refer to as “Northwest Airlines 15 Minute-Time.”

There are two rules governing this unique time system:

First, everything is always going to happen in about 15 minutes. As in, “We should pull away from the gate in about 15 minutes.” Or, “We should be in a holding pattern for only another 15 minutes.” Or, “We should be on the ground in about 15 minutes.”

Second, “15 Minutes” actually means “At least an hour.”


When the kids were young and diapers needed changing, we drove the 900-plus miles from the East Coast to the Upper Midwest. After our experience flying Northwest Airlines the last three summers running, I decided to look into whether we should start driving again.

I did my own calculations, based on an estimated average driving speed of 65 miles an hour and allowing for stops every five hours.

And, based on Northwest Airlines 15-Minute Time, I think we could make the trip in only about, oh, 15 minutes.


Jeff Matthews
I Am Not Making This Up


© 2007 NotMakingThisUp, LLC

The content contained in this blog represents the opinions of Mr. Matthews. Mr. Matthews also acts as an advisor and clients advised by Mr. Matthews may hold either long or short positions in securities of various companies discussed in the blog based upon Mr. Matthews' recommendations. This commentary in no way constitutes a solicitation of business or investment advice. It is intended solely for the entertainment of the reader, and the author.

18 comments:

BB said...

Lets all cross our fingers that Midwest Express doesn't get gobbled up by NWA and private equity. "The Cookie" may be the only viable alternative to getting around the upper midwest in the short term.

Stock Market Beat said...

My wife and I take a trip to the UP from NYC nearly every year. We also travel with child and we would prefer to control our destiny than to save time. At any rate, by the time you arrive at least an hour early, have the plane delayed, miss your connection etc. I don't think you lose much.

The compromise solution we have considered would be to fly to the nearest airport with direct service and rent a car. That limits the opportunity for foul-ups along the way. Green Bay and Milwaukee are two choices with pretty good service.

But on the other hand, the UP is too nice the way it is - the last thing it needs is visitors from New York. So keep painting the trip as being undesirable so we don't have to share.

Martin said...

United is almost as bad as Northwest with delays these days.

Having given up on flying from Chicago to northern Michigan for vacation, I would recommend you look into flying into Detroit and driving from there. That should allow you to eliminate flight change-overs and eliminate a good part of the drive time.

Rob said...

You don't like the weather delays you encounter in our antiquated air traffic control system? Neither do we pilots!!! Imagine the invective heaped on us when we too learn that--surprise--(fill in your favorite airplane crashing weather phenomena here) moving in on top of the field have caused delays again (don't know why we didn't cancel before we even left the gate--oh yeah, that's right, the managers say customers don't want us to cancel, they'd rather go for it). A lot of these weather events (blizzards, thunderstorms) we could fly into, but not safely. I don't fly for NWA, but the crowded skies and ATC have more to do with delays than does weather, regardless of where or with whom you fly. Of course, successive Congresses don't seem to be interested in funding the upgrades, but I doubt the FAA could manage if it was given to them anyways(look at the computer integration fiasco).

Of course, the airlines could deal with more disruptions if they weren't so leanly run. Of course, they'd be leaner if it wasn't for those pesky regulations (oftentimes recommended by the NTSB after a fatal crash--we still haven't properly addressed crew rest, so just you wait for that shoe yo fall). You can thank their margins for their leanness. And you can thank deflationary (last 15-20 yrs) ticket prices and rising fuel costs for the margins.

In short, you get what you pay for!!!!!!!!

You want a better system? Blame Kennedy for the way we deregulated in 1978! Otherwise, just sit there and wait for equilibrium to establish itself (which, watching all the new airlines/air taxi operators coming down the pike, won't happen anytime soon).

Strangely enough, this is exactly what you asked for--ain't unintended consequences a beeatch?

Jeff D said...

NWA is the only airline I will pay a significant premium to avoid flying with.

I have never had a flight from them that was not delayed in some way, and the employees simply don't care.

Jeff Matthews said...

Rob the Pilot does us all a favor with a real-world, first-hand report from the cockpit.

And I do think a big part of Northwest's problems stem from its heritage as a financial windfall for Al Checchi and Gary Wilson.

But why, Rob, do pilots appear unable to pass along information to the passengers as they get it?

Why do planes enter a holding pattern--anybody can tell a holding pattern in 5 minutes--and not hear for a half hour that we've been in a holding pattern because of weather up ahead?

Why do pilots not give a worst-case, realistic sense of delays instead of the standard "shouldn't be much longer"?

At the very least communicate with passengers early and often, otherwise you leave them anxious, uncertain and angry. (JetBlue is terrific at this--which is why their Easter melt-down was such a shock to passengers.)

Case in point: during the final, especially awful leg of our flight (the refueling guy in Elmira was, we were informed--and I am not making this up--in bed), the pilot at one point said "I'm sorry, we know how you feel."

The spontaneous response in the cabin was "No you don't!"

wcw said...

NWA was a disappointment for the half-decade we moved to Minneapolis, but it wasn't so bad. Compared to the detritus I've flown (US Air, whichever of Untied or American has the really, really tight seat spacing, that weird African airline on which I flew a DC-3 that had actually been a part of the Normandy invasion and about which the pilot responded to my brother's concern that its engines were leaking oil that, "we don't worry until the oil stops leaking"), NWA is a piker.

But yeah, they're no Southwest. Er, Jet Blue. Whoever your competent name-of-the-month is.

This month, I like Caltrain.

punchcard said...

Jeff - on a totally unrelated topic, I'd be very interested to hear your thoughts about Moody's. The stock is in free fall, dropping to 15x '08 earnings (IBES estimates) today. If you think the franchise is safe, it's probably the best buy in the S&P. On the other hand...

Jeff Matthews said...

Punchcard: I have no strong opinion on Moody's-the-stock either way...and I would not reflect it here if I did.

I view Moody's-the-company, on the other hand, as a co-conspirator in the sub-prime debacle that deserves whatever it has coming.

Which could be nasty, given our politicians' tendency to react AFTER the bubbles have burst, not before.

CR said...

Jeff...

I would rather travel thru O'Hare that spend another penny with Northworst. The biggest issue with the company is that the employees---attendants, customer service, mechanics, you name it---don't seem to care. As a result, we sit and wait. Not to mention that Detroit Metro Airport has the most surly, rude & indifferent workers out of any airport in the nation.

When you head to N Michigan, check out United or American into Traverse City. Yeah, you've gotta go thru O'Hare, but at least they won't be looking for some tools or a mechanic in order to take offf.

Finn Kristiansen said...

Last week the NY Times had a profile on chef Mario Batali, who keeps a second home in Michigan to get away from NYC. He was singing Michigan's praises.

We are blessed in this country with some truly awesome places.

One year we headed from NJ to Minneapolis for a family reunion and detoured north through Michigan, going over the bridge to the UP, then across Wisonsin's forehead. Michigan was a true delight and an eye opener.

pandora said...

As a flight attendant for over 20 years, I would like to respond to why Northwest employees just don't seem to care anymore.

When I come to work, I still care, but I have a revised list of priorities.

First, I care about the employees who lost their homes when they could neither make the payments after a 40% pay cut, nor sell their house in Detroit's dismal housing market.

I care about the NW employees who are barely making their bills, but don't have enought money to eat on a layover.

I care about the stress this has all placed on many marriages.

I care about the suicides.

I care that the flight attendants cannot afford to make the co-pay on their health care. The benefits were slashed as deeply as the employees' pay.

As you can clearly see, there still is a lot of caring going on during the flights. It's just placed on greater priorities than whether you're going to miss two hours of your vacation.

I make no apologies for these statements. I am still a professional. Safety is NEVER compromised by me. Passengers still compliment me on my service. However, you get what you pay for. If you want the cheapest tickets you can get, lower your expectations a little in the "warm and fuzzy" aspect of your air travel. I am too busy holding the hands of my co-workers who have REAL PROBLEMS, not the mere inconveniences of which so many of you spoke.

CR said...

Pandora,

While I can sympathize with your concerns, they are not exclusive to the airline industry---workers around the country go through similar situations. However, Northwest's employee behavior can directly influence the well being of the company---and the job security of its workforce.

If you piss off enough travelers with rotten attitudes, delayed and/or cancelled flights because workers don't show up for work, poor service & general ineptitude, travelers such as myself wont be looking for "warm & fuzzy" air travel from Northwest. We will just move to a different carrier. When enough of this occurs, NW's revenues will decline & then they will be forced into the vicious circle of cost cutting---i.e. layoffs & job elimination. After this continues for awhile, management will be forced to do what management does best---take the airline into bankruptcy once again, slash to the bone, give themselves huge "restructuring bonuses" & then re-emerge to start the process all over again.

So while you say that we need to get over our mere inconveniences of flying Northwest, not everyone uses the airline for vacation. Business travelers will not stand for the contined lost productivity of sitting 6 feet from the gate for an hour plus while NW tries to find some disgruntled gate worker to do their job.

Bethee222 said...

You're absolutly right, if anyone really wants to get to their destination, don't buy a ticket on Northwest Airlines.

dennysman said...

Jeff, next time fly into Detroit and drive the rest of the way. Or Flint (FNT) if you can find a direct flight there. If you come through Detroit I'll buy you a beer. Jeff Wong

Jeff Matthews said...

Jeff Wong: done deal!

Aaron said...

to pandora:

My uncle works for NWA and I share your sentiments. The pain and sufefring that the flight attendants have gone thru at NWA by current management is shameful, to say the least.

abby said...

Passengers get a raw deal too.
Since August 24 th of 2007 they lost my luggage. I've since then provided them with statements with most of my purchases , i even provided original receits of purchases for the time my luggage was lost. I've called over fifty times . They stated in a letter that they don't have time to go through my statements so unless i have receits , "SORRY" . Well guess what? "SORRY " doesn't bring back my luggage. I'm currently seeking legal advice o the matter and hopfefully sue them.