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End of the Airline Giants?

Last month, Melissa mentioned Delta and United’s management woes. Just recently, Delta’s pilots have offered to take a 23 percent pay cut, resolving a deadlocked talk with the management. But company leaders say the cut is not enough to steer the struggling airline from bankruptcy.

It’s the second in a row of labor troubles at the airline industry. Southwest’s CEO James Parker unexpectedly stepped down last week from what he calls a “draining” job. Part of the reason is a grueling two-year-long talk with the airline’s flight attendant’s union.

There’ve been a lot of media accounts about how budget airlines, such as Song and JetBlue, have outperformed giants like United Airlines. Lesser known foreign names such as Air Asia, many of which hire non-unionized workers, have also grabbed headlines.

Does this spell the end of the airline giants? How can they keep costs under control while keeping their morale high? Both seem to be crucial to survive.FCS