=20 ---------------------------------------------------------------------- This article was sent to you by someone who found it on SF Gate. The original article can be found on SFGate.com here: http://www.sfgate.com/cgi-bin/article.cgi?file=3D/news/archive/2003/11/24/f= inancial1603EST0196.DTL ---------------------------------------------------------------------- Monday, November 24, 2003 (AP) Delta CEO's successor faces big challenges HARRY R. WEBER, AP Business Writer (11-24) 13:03 PST ATLANTA (AP) -- He has led a railroad, served on several corporate boards and kept anoth= er airline out of bankruptcy. Now, Gerald Grinstein will try to turn around a struggling Delta Air Lines, a challenge the 71-year-old said he is prepared to take on for the long haul. "The company has the ability to do well," Grinstein said in an interview, but the key will be keeping employees "in high spirits and motivated." That could be difficult given one of Grinstein's immediate tasks: winning steep wage concessions from Delta's pilots. Delta wants to cut pilots' hourly wages by 22 percent, cancel pay raises due over the next year and reduce some benefits. Grinstein negotiated wage concessions when he was head of Western Air Lines from 1985 to 1987, and analysts say this experience could serve him well with Delta's ongoing talks with pilots. Western was bought by Delta in 1987. "We concluded we needed someone with previous experience as a CEO as well as someone who knew the airline business," said John F. Smith Jr., a Delta board member who will assume the post of chairman when Mullin steps down from that role in April. "Grinstein was the obvious choice." Grinstein, who has been a Delta board member since 1987, will take over the airline when Leo Mullin steps down as CEO on Jan. 1. A graduate of Yale University and Harvard Law School, Grinstein served as an executive of Burlington Northern Inc. between 1987 and 1995 and as a board member at Agilent Technologies, in addition to other companies. He is chairman of the University of Washington Board of Regents in Seattle. At Palo Alto, Calif.-based Agilent Technologies, a spinoff of Hewlett Packard Co., Grinstein helped in recruiting other board members and brought sound business judgment to the job, said chief executive Ned Barnholt. Grinstein, of Bellevue, Wash., retired from the Agilent board in early 2003 because the board has a mandatory retirement age of 70, Barnholt said. "He has a very good style of working with people that has made him very effective in the board and probably through all his career," Barnholt said. "He just was very helpful in understanding what board governance was all about -- what kinds of skills we should be looking for on the board, making sure we had the right mix of personalities that would work well together as a team." Barnholt said Grinstein's high energy makes him a good fit for Delta. "He stays very engaged in anything he's involved in and I'm sure he'll p= ut 100 percent into (Delta)," Barnholt said. At Delta, Smith said he will work with Grinstein on developing a long-te= rm strategy for the airline. Grinstein, meanwhile, will travel the country meeting with Delta employees. He also said he is in it for the long haul. "My next challenge is to go out over the month of December and meet with employees and listen to what they have to say," Grinstein said. "There is no time limit on how long I intend to serve." Mullin, for his part, said he believes Grinstein will be a good leader f= or Delta. It was Grinstein who recruited Mullin to join the company in 1997. "I think Delta's on the right track and has a bright future associated with it, with much work still to be done," Mullin said. AP Business Writer Helen Jung contributed to this report from Seattle. =20 ---------------------------------------------------------------------- Copyright 2003 AP