Dirty Little Air War

Bully! Crybaby! Northwest and Sun Country brawl for control of the sandbox--and billions in local air-travel revenues

By Kariya's lights, the eviction notice might as well have come directly from Northwest. Terminal 2 was remodeled in the late Eighties at a cost of $94 million; the project was financed by Northwest and four other carriers. Two of the five airlines that drew up the original deal are no longer in business. (Managers at Terminal 2 did not return repeated phone calls for this story.)

Within days, Sun Country lost its tenuous hold on a gate in Boston as well. Northwest had been leasing the space to charter carrier American Trans Air (better known as ATA), which does business with the La Macchias' Mark Travel, and which subleased the gate to Sun Country. But in December ATA stopped flying to Boston, and Northwest evicted Sun Country.

Again, says Kariya, he was told the decision had been made "for business reasons." Again, he adds, the gate sat empty for months. Northwest also canceled Sun Country's sublease of its offices in the Boston airport.

Brian Stauffer

Northwest spokesman Jon Austin says Sun Country's accusations about the lost gates are "false," but won't elaborate further. On the matter of contracts, the company has more to say: Austin's office has prepared a six-page memo refuting Sun Country's allegations on that and other points. Regarding the ground-handling agreements, the document sets out the same explanation Kariya was given: "Northwest has concluded that fulfilling its contractual commitments to serve other carriers can distract its employees from their primary mission: to serve Northwest customers."

As he was frantically trying to jury-rig substitute gate arrangements in L.A. and Boston, Kariya received a phone call from someone at Northwest. The caller, whom he doesn't want to identify, asked where else the two airlines had agreements. Kariya says he nearly laughed himself sick before refusing to answer.

Even without his help, Northwest seemed to be locating plenty of Sun Country deals to cancel. In Seattle, maintenance and training contracts between the two airlines were suddenly terminated; a deal under which Northwest trained Sun Country's pilots and flight attendants at its simulation facility in Minneapolis ended recently. And on June 6, less than a week after Sun Country officially began service as a scheduled carrier, one of Northwest's vice presidents sent out a companywide memo barring its new rival from buying or borrowing spare parts.

Because it's almost impossible for any airline to keep a full inventory outside its hub, swapping parts is a standard practice in the airline industry. It's hardly charity; in addition to the cost of the part, the airline in need usually pays a hefty fee. According to maintenance administrators at Sun Country and other airlines, the practice helps keep everyone flying safely and on time.

When news of the ban surfaced in the New York Times, a Northwest spokesman was quoted as saying the directive had come after Sun Country was found using too many Northwest parts. In its recent memo, the company makes the same point, adding that while it may turn a profit on the parts, the revenue isn't worth the hassle: "Northwest is not in the parts business, it is in the airline business....Northwest is not willing to impose on its parts department the burden of answering the phone, looking for parts, and putting them on trucks to deliver to Sun Country."

Besides, adds the document, it's only logical that the relationship between the two airlines should have changed: "[In the past] Northwest had a direct financial interest in the operational integrity of Sun Country's services because, for the most part, Sun Country was carrying MLT passengers. If a Sun Country flight could not operate because it needed a part, that service failure directly affected MLT and Northwest." The incentive to keep Sun Country flying disappeared along with the charter partnership, the memo states.

Sun Country's Lee says that seems disingenuous: Northwest is continuing to give parts to plenty of competitors, she claims, and Sun Country's requests have dropped steadily for the past three years. The ban, Lee argues, is evidence of the paranoia with which the bigger airline greets even the smallest threats. "What Northwest is trying to do is to sew up every aspect of the community, dominate market share, and squeeze out competition," Lee asserts. "The lengths they've gone to are incredible."

For example, she says, whenever La Macchia speaks in public someone from Northwest is in the audience; Lee figures the rival execs seek to divine, political-campaign style, what the subtext of his speeches might portend. And indeed, when La Macchia took to the podium to address a recent luncheon of the Bloomington Chamber of Commerce, Jon Austin was there, periodically setting down a forkful of haricots verts to applaud.


George Wozniak's penchant for spilling the beans has long made him a thorn in the airline industry's side. He is the owner of Hobbit Travel, a high-volume Minneapolis travel agency that bills itself as "the low-fare company"; ten years ago he did a weekly travel segment for KSTP-TV's Good Company. On the show he talked frankly about financial back-scratching arrangements in air travel--things like how wholesalers operate and how agents shop for fares.

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