ATLANTA, March 19, 2002 - Delta Air Lines Chairman and CEO Leo F. Mullin today reviewed the state of the airline industry and called for a four-step program designed to bring the industry back from the edge of financial failure while providing safe, secure and convenient travel for customers. Mullin made his remarks at the International Aviation Club, a Washington, DC, aviation policy forum.
Mullin reviewed the state of the nation’s air transportation system, sharing encouraging news about the return in travel demand and the likelihood that all U.S. airlines will survive despite losses near $8 billion in 2001. Mullin acknowledged and thanked Congress and the Administration for being “true allies in helping the airlines work through the immediate crisis,” citing the Airline Stabilization Act that supplied $5 billion to keep the industry intact following an attack that employed aviation as its weapon.
Mullin encouraged the airline industry and the government to seize the opportunity to fix the problems that continue to face the airline industry once and for all.
“Though airline survival seems assured, the potential for the industry to grow and thrive, and to serve as the strong heart of a healthy economy, is seriously threatened,” Mullin said.
The first point of Mullin’s plan is to “put customers in first place.” Mullin reaffirms Delta’s unwavering commitment to the federal security system. While significant improvements have been made to security since September 11, Mullin noted the need to minimize the “hassle factor” for airline customers while continuing to focus on security.
“It is increasingly clear that random screenings are ineffective,” said Mullin, who advocated a stronger emphasis on a passenger profiling program that identifies threats based on information, not cultural or racial bias. In addition, Mullin identified the need to “halt and reverse the growing burden of passenger taxes and fees” that are currently 26 percent of the total airline ticket price - up from 15 percent five years ago. The second point of the plan would allow airlines to use a normal range of business tools, including restructuring.
“The airline industry needs access to the methods other industries use to address overcapacity and achieve cost benefits, including mergers and acquisitions,” Mullin said.
The third point would refine the collective bargaining process so it encourages resolutions without inconveniencing customers. Mullin recommended defining a new procedure that respects the collective bargaining process and also respects the customers the airline industry serves. He suggested the industry find some form of mandatory arbitration, citing the airlines’ inability to control the largest cost category - salary and benefits - in a highly unionized industry.
“From both a customer service and a financial perspective, no airline today can weather a strike,” Mullin said. “Our industry must find a way to arrive at labor agreements that ceases to hold the customer hostage in the process.”
Mullin’s final point in the four-point program reaffirmed the need to provide the infrastructure required to accommodate future travel demand. Mullin said while FAA forecasts show one billion passengers are expected to travel in 2013 rather than 2010, they are still on the way. “We must provide Air Traffic Control (ATC) and airport infrastructure that not only accommodates future customers but also welcomes them aboard with the level of service they deserve,” he said.
“We need, as a country, an aviation sector that thrives, not just survives,” Mullin said. “While we are still reeling from the recent events, we owe it to our industry and to our nation to preserve and protect the air transportation system so essential to our nation’s health for now and for the future.”
Delta Air Lines, the world’s second largest carrier in terms of passengers carried and the leading U.S. airline across the Atlantic, offers 5,987 flights each day to 418 destinations in 73 countries on Delta, Delta Express, Delta Shuttle, Delta Connection carriers and Delta’s worldwide partners. Delta is a founding member of SkyTeam, a global airline alliance that provides customers with extensive worldwide destinations, flights and services. For more information, please go to delta.com.