Right now, just after the nuptials have been announced, there is reason for Utahns to be optimistic. The two airlines have few overlapping routes, and because Northwest does not have a hub in the West, Salt Lake City should continue to fill that role for the merged airline. That's good news for Utah jobs.
By contrast, a merger with United or US Airways would have put the Salt Lake City hub at risk.
Because Northwest will bring strong access to Asian markets to the deal, Utah stands to gain a gateway to Asia. Plus, it should become easier for Asian travelers to come to Utah to ski, do business, attend a convention or explore the Beehive State's magnificent national parks.
All that bodes well.
Of course, employee layoffs often follow mergers. Delta and Northwest say they expect to eliminate some front office jobs, but not those in operations. We'll see. One goal of the newly joined company may be to reduce the overall number of seats, although the two new partners have pledged not to reduce domestic capacity.
The air travel business already is suffering because of steep inflation in the price of fuel, and a merger should marginally reduce price competition, thus making it a hair easier to raise fares. The new Delta still will face competition, though this merger will probably spark others.
The other turbulence on the horizon is the failure of the pilots for the two airlines to come to an agreement on how to merge their seniority lists. That's no small matter, because it determines which pilots fly as captain versus first officer, and which ones get the bigger aircraft. Those factors, in turn, affect compensation.
Most analysts say that the merged company's success or failure in working with the pilots and other employees to integrate the work force will be one of the two biggest variables that decide the fate of the new Delta. The other will be the price of jet fuel.
A couple of years ago, when Delta was writhing through bankruptcy, some of its employees told us that the trouble with the airline industry was that there were too many airlines. That theory is about to be tested.
