American Airlines deserves credit, but good intentions can't fix everything

By MITCHELL SCHNURMAN

Layoffs are always painful, but last week’s cost-cutting move by American Airlines was a heartbreaker.

American plans to close its maintenance base in Kansas City, Mo., and eliminate 700 positions companywide. As layoffs go, they’re not the largest in the carrier’s history or the most traumatic, and the impact in North Texas will be limited.

But closing Kansas City is a sobering reality check. It shows that some forces can’t be resisted, no matter how hard you try, no matter how good your intentions. And it raises the question of how long American can continue to swim against the tide — not only with maintenance jobs, but with its pension plans, too.

American and its employee group, the Transport Workers Union, have been fighting the good fight for a while. They’ve hustled mightily to keep good jobs here, while competitors have outsourced much of their maintenance work to places like Mexico, El Salvador and China.

In 2003, when American restructured to avoid bankruptcy, it rejected the outsourcing option. Even then, the Kansas City base was on the bubble, because airlines were already retrenching in a major way.

American and the TWU committed to cut costs, but that wasn’t enough. They also wanted to turn the maintenance bases into a profit center, an audacious goal that produced some notable results. In 2006, American brought in $95 million in outside business and vowed to almost double the total.

As important as the revenue bump, American needed a model for a new type of labor-management cooperation — something that would reverse a history of hostile relations with employees. The TWU became a great partner.

Rank-and-file workers embraced the new approach and figured out ways to overhaul engines in half the time, with fewer than half the people. Labor and management communicated regularly about the business, even after talks on a new contract broke down.

Together, they bid aggressively on outside work, landing major deals with domestic and foreign carriers.

"We’ve changed the way we do business," says Steve Luis, president of the TWU Local 514 in Tulsa, where American has its largest maintenance base. "We’re trying to show the world what unions can do."

American and the TWU have received a load of positive publicity for their feel-good story. But all the praise, and progress, weren’t enough to save Kansas City.

"We tried about everything we could, but there were external things that we had no control over," says Don Videtich, TWU’s international representative, based in Hurst.

The shrinking airline industry is the biggest problem. American, which once had 900 planes, now operates 600. And it’s moving to replace an aging MD-80 fleet with new Boeing jets that will require significantly less maintenance.

The bases have taken on more tasks, such as adding winglets to improve fuel economy and installing Wi-Fi systems for the Internet. But there’s simply less work to do.

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