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Aug 9
Is Liquidation Possible at Northwest Airlines?
The airline industry may have one of their first large scale legacy carrier deaths.  If Northwest Airlines and their flight attendants can not come to an agreement by Tuesday evening, flight attendants plan to enact CHAOS- Create Havoc Around Our System.  Vice President Julie Hagen Showers said in comments from a New York Bankrutcy court that the airline may be forced to start to liquidate if flight attendants disrupt  any of the operations at the airline. 

Showers says even intermittent strikes would put the airline in danger. She says if Northwest lost 20 percent of its traffic, "we could not sustain ourselves."

Flight attendants at the airline are not backing down.  A statement on the AFL-CIO weblog shows the flight attendants are serious about sending the airline a message. 

a330nw3.jpgSays Mollie Reiley, AFA-CWA interim Master Executive Council president:

Our members have spoken: These drastic cuts to our pay, benefits and work rules are simply unacceptable. While we will attempt to go back to the negotiating table with the company, we continue preparing for CHAOS.

Other airlines must be foaming at the mouth for Northwest to go under.  Northwest Airlines has nice big international hubs, and a very prized possession, those key routes to Asia.  Not only does NWA have key routes to Asia and Europe but if the number 5 carrier in terms of passengers goes under, that's a huge chuck of capacity taken out of the market. 

It is unlikely that NWA will liquidate and go under in a matter of months, emergency funding and other sources of capital would probably help save the airline but it may be an entirely different and much smaller airline if the airline and the flight attendants can not agree on a settlement. 

Some quotes taken from MInnesota Public Radio Website and AFL-CIO Weblog

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