Pinnacle Airlines Corp. (PNCL) is continuing negotiations with its pilots after it failed to meet the March 31 deadline to reach an labor agreement that would guarantee it additional flying as a Northwest Airlink. Under its new Airline Services Agreement with Northwest, Pinnacle was awarded 17 Bombardier (BBD) CRJ 200 aircraft in December 2006.
"Although I am extremely disappointed we have not reached an agreement, tremendous progress has been made and I appreciate the hard work of the pilot's negotiating committee to move these discussions forward," said Philip H. Trenary, Pinnacle's President and Chief Executive Officer. "Reaching an agreement is important to all our stakeholders -- pilots, other employee groups, investors -- and we will continue to work diligently to reach an agreement." As a result of Northwest obtaining the right to remove the 17 aircraft, the size of Pinnacle's stipulated unsecured claim against Northwest will increase by $42.5 million. Receipt of this claim partially off-sets the loss of income associated with these 17 aircraft. Pinnacle was required to have reached an agreement with its pilots by March 31, 2007 or Northwest obtains the right to remove the aircraft at a rate of three aircraft per month. Fifteen of those17 aircraft were added into service during first quarter 2007. Related Story Northwest and Pinnacle reached agreement in December on a long-term contract calling for the Airlink to operation 124 Bombardier CRJ 200s. Related Story
Northwest is in the final days of acquiring Mesaba and may give the aircraft to its subsidiary which is now gearing up to take 36 76-seat CRJs, acquired last fall by Northwest. Related Story In addition, its new subsidiary Compass just received certification. See related story in this issue.
ALPA MEC Wakefield Gordon, who represent the carriers’ 1,200 pilots, told the Star Tribune no talks are scheduled to resolve key money, benefits and retirement issues. "This is a $340 million deal over five years," he said. "We were $20 million apart at the end, and they couldn't come up with any more money to close the deal. They are going to risk the loss of 17 aircraft for that amount of money."