Grinstein succeeds Mullin
Delta Air Lines chairman and chief executive Leo Mullin has retired after more than six years at the helm of the world's third-largest airline, handing over his duties to long-time Delta director Gerald Grinstein.
Mullin made a "personal decision" to surrender those duties and leave the carrier. Mullin will remain chairman of the board until late April, when John Smith Jr, now a Delta director, will succeed him as non-executive chairman.
Grinstein, 71, was the Western Airlines chief executive when Delta took over Western in 1987 in a merger that is generally considered to have gone smoothly. After that Grinstein became an officer of freight carrier Burlington Northern Railroad, and was board chairman of the company after it took over the Santa Fe railway, leaving the rail line, one of the two largest in the USA, in 1995.
Labour negotiations were the first item on Grinstein's agenda. Deutsche Bank analyst Susan Donofrio said Grinstein "may be a better fit" than Mullin in dealing with the pilots' union. She says: "Not only does he have the airline background to quickly assume the leadership role, but Grinstein also contributes seasoned labour negotiation experience from his prior days at Burlington Northern Railroad."
The airline's only major union, the Air Line Pilots Association, had resisted Mullin's requests to discuss pay and work rule concessions, noting that under their contract the pilots do not have to consider major changes until 2005. After their first meeting with Grinstein in mid-December, the pilots said they and management were still far apart on pay issues.
A man overlooked by Delta's board for the top job, at least for the time being, is president and chief operating officer Fred Reid. The former Lufthansa executive joined Delta in 1998 and is expected to take the chief executive's role at some point, if he stays at the carrier.
Mullin was granted 22 years of seniority when he was hired in 1997, and will collect $16 million in pension benefits when he leaves.
DAVID FIELD WASHINGTON
Source: Airline Business
