In my defense, it wouldn't be the first time that someone made a decision based on emotion. After all, who can say "no" to warm chocolate chip cookies?
Today, Midwest Airlines announced that it was reducing its workforce by 40%. This translates into 1200 employees and comes on top of 380 jobs cut a couple of months ago.
Moreover, in addition to the previously announced decision to ground its older MD-80 planes, Midwest says that it will also be grounding five of its newer Boeing 717s. This means that Midwest is cutting its entire fleet approximately in half! In other words, if Midwest is somehow able to avoid bankruptcy, whatever remains of its flight schedule will be a fraction of what it was before.
It's really unfortunate that it has come to this.
First and foremost, it's unfortunate for the employees at Midwest who will either lose their jobs or have to take dranconian cuts in pay. It's also unfortunate for those of us who have become spoiled by flying non-stop to various destinations on "the best care in the air". In the big picture though, it is perhaps most unfortuinate for those responsible for promoting business development in Wisconsin who have relied on Midwest for non-stop service to destinations across the country.
I guess nothing good lasts forever.
In the wake of today's announcement however, I do find myself wondering whether those of us who opposed AirTran's hostile takeover attempt of Midwest last year got it wrong? After all, a year ago AirTran claimed that if it succeeded in the takeover, it would add 74 daily departures from Milwaukee, double seating capacity, add 29 destinations and add 1100 jobs. AirTran also argued (correctly as it turns out) that Midwest's aging fleet of MD-80s would not be economically viable to continue to operate.
Frankly, from the perspective of the flying public, AirTran's offer looks pretty good right about now.
It's true, of course, that a year ago nobody (except perhaps the people who run Southwest Airlines) anticipated $140 per barrel fuel costs. It's also true that AirTran announced last week that it too was cutting some jobs (5% of its workforce) and seeking some wage concessions (although nothing close to what's happening at Midwest). At the same time, despite all this, AirTran says that it hopes to continue to expand its presence in Milwaukee.
Unquestionably, the acquisition of Midwest by private equity firm TPG last August thwarted the AirTran takeover and made some money for Midwest shareholders and management. In retrospect though, it didn't do too much for air travelers in Southeastern Wisconsin.
I admit that I have a soft spot in my heart for the "hometown airline". What my head perhaps failed to appreciate though was that the business model for my "hometown airline" was no longer viable.
Hindsight is 20/20. At the same time, had AirTran had succeeeded in taking over Midwest, it's hard to see how things could be worse for local air travelers today.
As I look back on events of the last year, I hope I wasn't thinking too much with my heart and not enough with my head. If I was though, I have no good excuse. Beliueve it or not, I really do almost always say "no" when they offer me the chocolate chip cookies.
As I've disclosed before, Midwest is a major advertiser on NewsRadio 620 WTMJ (including on my program). AirTran is also a sponsor of my show.
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