A look back as we say farewell, Red Tail

Those faint blinking lights on the horizon are the former hometown "Red Tail" fleet heading southeast for a new paint job in Atlanta.

The new mantra at what will soon be the Eagan regional headquarters: "Fly Delta jets."

Northwest Airlines' acquisition is the final act in an economic drama that began eight decades ago when Northwest Airways started flying the mail from the Twin Cities to Chicago and, 20 years later, Wisconsin Central got off the ground, eventually to morph into North Central Airlines and then Republic Airlines. They were regional airlines, tightly regulated by the federal government on everything from routes to fares.

I was around 30 years ago when President Jimmy Carter's signature on an act of Congress opened the industry to competition and sparked a quarter-century's worth of mergers in our town and across the nation. Part of my job as a short-time public relations man for Republic Airlines in 1980 was to explain why we were halting service to small cities like Mankato and Worthington.

The federal subsidy to serve small markets was going away. Most of the folks understood. But that didn't mean they liked it. Passengers and politicians have always had love-hate relationships with their airlines.

Since 1986, when Northwest acquired Republic, the Eagan-based carrier has lurched from one financial crisis to another. Even before that, Northwest always seemed to be at war with its workers. Pilot strikes in the 1970s and 1990s. Mechanics strikes in the 1980s and earlier this decade.

Yet employees often harbor fierce pride. Northwest employees crowded the Capitol when the state debated a bailout bill in the early 1990s. They howled when a local television station suggested its operations were unsafe.

Rising fuel prices, intense price competition and management missteps have shrunk the industry from about 15 national and regional players 30 years ago to six that pack any national punch today.

NWA is important to Delta because the Red Tail is strong in the northern tier of the United States and in the Pacific. Beyond that, the future will be about leadership and luck. And the odds are against a smooth takeoff.

Richard Anderson, the former Northwest CEO who joined Delta after it emerged from bankruptcy last year, has a tremendous ability to connect with the rank-and-file and to sketch a great and prosperous vision. And he's going to need the goodwill of the Northwest pilots, who so far are playing second fiddle to the younger group at Delta.

He also will seek the blessing of Minnesota politicians and a hometown crowd who don't understand why they should cheer for a deal that leaves the Twin Cities as a secondary hub with a declining employment base when it was once the headquarters of a globe-spanning airline.

Time for a little history lesson, slightly revised by me:

Deregulation allowed North Central in 1978-80 to buy ailing Southern Airways and Hughes Airwest, giving Republic, as it was called by then, range to the west and southeast. But that added debt and gave way to losses during 1981-83. In 1984, the dynamic Steve Wolf showed up as CEO, just in time to rally the troops amid an economic uplift. Republic became a formidable, profitable carrier that gave Northwest real competition on key domestic routes.

Act II, 1986-1989: Steve Rothmeier, the no-nonsense chief executive of NWA, bought Republic in a smart cross-field move that filled out NWA's domestic routes. But Rothmeier caught flak for a disruptive merger and a seniority-list war between the Red Tails and Republic's "Green Tail" pilots that left passengers seething.

So long, Herman, the mallard that adorned the Republic tail.

Act III, 1989-1998: A couple of California financiers, Gary Wilson and Al Checchi, led an investor group in a debt-heavy $3.65 billion buyout of Northwest. Checchi and Wilson managed to lose tons of money as high oil prices sparked by the first Gulf War drained their finances. The Legislature helped Northwest avoid bankruptcy with a crucial $838 million loan in 1991. Employees agreed to pay concession, and the airline turned around. NWA went public in 1994 and Al and Gary got richer. In 1998, the pilots struck for two weeks, grounding the airline.

Act IV, 2001-2008: The major airlines were hammered with huge losses after the Sept. 11 attacks. After the Iraq war began in 2003, oil prices march steadily upward. By 2005, both Northwest and Delta succumbed to bankruptcy.

The Twin Cities is a great market and this will continue to be a valuable hub for Delta. All we need is strong leadership, lower fuel prices and lots of luck. Especially luck.

So long, Red Tail. Sleep well, Herman.