Delta Deal Not Riding So High in Its Own Hometown

Matt Towery

5/1/2008 12:01:00 AM - Matt Towery

ATLANTA -- Residents of Minneapolis-St. Paul, Memphis and dozens of other cities around the nation who are opposed to the merger of Atlanta-based Delta Airlines with Northwest Airlines may be shocked to learn that less than 50 percent of Georgians are supportive of the proposal. Delta is based in Atlanta.

An InsiderAdvantage/Majority Opinion survey conducted April 17 shows that 40 percent of the respondents favor the merger of Delta and Northwest, 16 percent oppose it, and 45 percent are undecided or have no opinion. The poll surveyed 445 Georgians, and has a margin of error of plus or minus 5 percent.

That's hardly a ringing endorsement of a deal that would make Atlanta, a city of over 5 million residents in its greater metropolitan area, the headquarters for the merged airline, to be called Delta.

For its part, Delta has assumed that Georgians would be leaping for joy over the news of the proposed merger. In fact, the poll shows residents have many concerns.

Atlantans are famous for sitting in hours of commuter traffic, and for having to stand in long security lines at their airport, already the world's busiest. The survey indicates, particularly among those surveyed who said they had flown Delta in the past year, that they have significant concerns over the creation of a "mega-carrier."

Delta's dominance in the Atlanta area has left fliers with few alternatives to flying Delta, and also has stuck travelers with sky-high ticket prices, particularly for businessmen and women who often must purchase their ticket on short notice.

Aside from the issue of ticket prices, the poll reveals many other concerns about the merger.

The respondents listed reduced quality of service, potential for longer delays, loss of "Frequent Flier" points and lost baggage as among their biggest worries about the merger.

All of that is in Delta's home state. And it sets the stage for a political nightmare that could run straight from Georgia all the way to the presidential election.

Let's start at the top. The Republicans chose Minnesota's Twin Cities as the site for their presidential convention, and for good reasons. Minneapolis-St. Paul typifies "real America," and avoids the excessive glitz and glamour that make many cities seem out of touch to average Americans.

It is also a sophisticated and proud community. Does anyone in the Republican Party think that the GOP will get a warm welcome if jobs are lost there because of the merger, and if a major corporate headquarters disappears in the largest metropolitan area of the state?

People in Minnesota are known for their independence and their unusual attention to politics. They understand that it is a Bush Justice Department that must sign on to this deal.

As the former chairman of Newt Gingrich's political organization when he was U.S. Speaker of the House -- we ran a national convention in San Diego in 1996 -- I can tell you that no presidential candidate wants to arrive in town only to be booed by the local citizenry. Of course, the Bush crowd could care less, because they have absolutely no love for John McCain, whether they'll admit it or not. They can't fool me.

Then there are the members of Congress, in Georgia and Minnesota, who have stuck their neck out for Delta and Northwest as they attempted to emerge from their respective bankruptcies. Do you think state officials in Minnesota don't regret the hundreds of millions of dollars they gave in tax breaks and other funding to save Northwest?

And what about the leaders in Georgia? Their risk is down the road. Suppose the merger goes through but becomes an even greater nightmare for those who fly out of Atlanta? What if the combined company ultimately fails? Not everyone believes that bigger is better. If that happens, I know some elected officials who can "pack their bags," because they will be on a one-way flight home from Washington.

To be fair, the two airlines say that they cannot survive financially without a merger. Perhaps that is true. But is that because of long-term inherent problems with the industry in general, or is it more accurately attributable to the temporary spike in the cost of jet fuel? And will a merger solve that problem?

Here's one thing our survey told us for sure: People in Georgia aren't thrilled with Delta's new CEO Richard Anderson. Sixty-eight percent of all Georgians said in an InsiderAdvantage survey that they had an unfavorable opinion of the $11.3 million Anderson earned for just four months' work when he took over the airline's leadership position in late 2007.

If Delta's argument to its own hometown is one about cost cutting, the message was lost in translation.

Perhaps the two airlines will and should merge. But they haven't given the public in Minnesota, Georgia or anywhere else any real reason to support their effort.