Word: lorenzo
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Dates: during 1980-1989
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...labor-management battles in the 1980s have matched in bitterness the feud between Texas Air Chairman Frank Lorenzo and the machinists at Eastern Air Lines. Since 1987 the International Association of Machinists and Aerospace Workers (I.A.M.) has staunchly resisted Lorenzo's demands for wage concessions. At midnight last Friday, after more than a year of federal mediation failed to produce an agreement, the union launched a strike that is producing havoc for the carrier's 100,000 daily passengers and could throw East Coast airports and other transportation hubs into turmoil...
Both sides in the dispute realize that a strike at the financially hemorrhaging carrier may finally send Eastern to "the corporate graveyard," as Lorenzo puts it. Eastern posted record losses of $335 million in 1988 and since then has been losing an estimated $1 million a day, a deficit that can only grow during the strike...
...machinists were the last major obstacle to Lorenzo's cost-cutting campaign. Since taking over the troubled airline in 1986, Lorenzo has slashed the work force from 40,000 to 30,000, dropped service to 14 cities and sold off the profitable Eastern Shuttle for $365 million to Donald Trump. Eastern's pilots and flight attendants had already submitted to wage cuts before Lorenzo took over...
Eastern's 3,600 pilots pledged to honor the strike even though Lorenzo had appealed to them at midweek via a 20-minute video taped at his Houston home. Said Lorenzo: "If the pilots, the flight attendants and the noncontract employees support the picket line and don't show up for work, Eastern cannot survive." As the tape rolled, Lorenzo took out a new contract he was about to offer his pilots and signed...
...asked for an additional $64 million a year in concessions. The pilots rejected the contract and threw their support to the I.A.M. members, asserting that the airline's fleet could not be safely maintained during a mechanics' walkout. Said John Bavis, head of Eastern's pilots' union: "What's Lorenzo going to do with 225 airplanes? Take them down to the local Jiffy Lube...