With chief executive officer Timothy Hoeksema saying the company is facing "the most difficult time in the history of aviation," Midwest Airlines plans to tell its pilots and flight attendants to take significant pay cuts today.
Pilots will be asked to take 50-percent pay cuts, and flight attendants will be asked to accept 30- to 40-percent pay cuts in an effort to keep the Oak Creek-based company in the air.
Midwest also will ground its 12 MD-80 planes, which are its least fuel-efficient, meaning the company will eliminate about a third of its fleet and reduce its number of flights.
In a video message to Midwest employees, Hoeksema said, "It's really a whole new ball game now. We don't have a lot of time. This is urgent … It's going to be very painful."
Company officials said they must take drastic actions this week to avoid having to file for bankruptcy. Hoeksema said Midwest must be "restructured completely."
Hoeksema said Midwest's fuel costs are $300 million higher this year than last year.
Earlier this month, Midwest Air Partners LLC, the parent company of Midwest Airlines, hired Seabury APG, a Vienna, Va.-based aviation consulting company, to create a comprehensive corporate restructuring plan for the company.
In April, Midwest said it will eliminate 109 jobs, or 3.5-percent of its workforce.
In addition to soaring fuel costs, Midwest is dealing with low-fare competition from AirTran Airlines. AirTran had tried unsuccessfully to acquire Midwest last year.
Midwest Airlines told the Air Line Pilots Association (ALPA) in April that 35 first officers will be furloughed and 22 captains will be downgraded to first officer. A union representative said the cuts could mean some the annual pay for some pilots will drop about $90,000 to about $35,000.
Hoeksema said he remains confident that Midwest will survive.
Midwest is owned by TPG Capital of Fort Worth, Texas, and Eagan, Minn.-based Northwestern Airlines Corp.

Rockwell Automation Inc. today advised that "less favorable market conditions" are causing the Milwaukee company to reduce its previous earnings guidance.
The company said it expects to report third quarter diluted earnings per share of 93 cents to $1.00, and that that "no longer believes" that full-year EPS will fall within the previous annual guidance range of $4.25 to $4.45.
The company's revenue for the month of April was consistent with original expectations. However, for the past several weeks, Rockwell has experienced slower-than-expected growth in the United States and Europe, primarily in its product businesses.
The company said it is evaluating the market outlook for the balance of the year along with appropriate cost control actions and will comment further during the third quarter earnings call.
Keith Nosbusch, chairman and chief executive officer, said, "I continue to have confidence in the long-term growth prospects for this business. It appears that market growth is slowing in two key regions, and we will deal with that reality. We remain committed to delivering appropriate profitability while preserving our investments in future growth opportunities and maintaining our technology leadership."
Wall Street had a negative reaction to the negative outlook, and Rockwell's stock fell $5.39 to $46.80 per share this morning

Armonk, N.Y.-based Visant Corp. announced today that it will close a plant in Pennsauken, N.J., and shift manufacturing operations from there to plants in Milwaukee, Hagerstown, Md., and Rockaway, N.J.
About 200 people work at the Pennsauken, N.J. plant.
The company is still trying to determine what changes will be made at the Milwaukee plant, which is located at 8111 N. 87th St. and does business as Lehigh Milwaukee, said Visant vice president of finance Paul Carousso.
However, he said the plant, which makes overhead transparencies for schools and book covers, will see some "incremental increase" in production, which should result in some increase in employment and the addition of some new equipment.
Currently, about 100 people work at the Milwaukee plant.
More employees will be added at the larger plant in Hagerstown, he said. No employees will be added to the Rockaway, N.J. plant.

Marcus Corp. today announced a new initiative to support tourism in the Wisconsin Dells in response to the recent flooding in the region.
Beginning July 3, Milwaukee-based Marcus Theatres will advertise the many popular attractions at the Wisconsin Dells through posters and pre-show advertising at its 45 theater locations in Wisconsin, Illinois, Minnesota and Iowa.
Marcus Hotels and Resorts and Marcus Theatres will place vouchers for free tickets to the famous Tommy Bartlett Show and other Wisconsin Dells attractions in the paychecks of its 4,000 associates throughout the four states.
"The recent flooding in Wisconsin and throughout the Midwest is a tragedy, and our hearts go out to those families and businesses who have experienced losses. The Wisconsin Dells was particularly hard hit, especially Lake Delton. We believe it is important for all Wisconsin businesses to support each other during this difficult time. Summertime is the major season for leisure travel, and to support our overall tourism industry, people need to know that Wisconsin is open for business," said Bill Otto, president of Marcus Hotels and Resorts.
"The Wisconsin Dells is one of the most popular tourist areas in our state and summertime is the prime vacation season. Many people learning about the flooding in the Wisconsin Dells believe it impacted the entire area and as a result have cancelled reservations and vacation plans. Marcus Theatres wants vacationers to know that they still can have fun this summer at all their favorite places throughout Wisconsin. We are happy to help spread the word that businesses in the Wisconsin Dells are ready and waiting to welcome visitors," said Bruce Olson, president of Marcus Theatres.
"On behalf of the Tommy Bartlett Show and the countless other Wisconsin Dells attractions that have been affected by the recent flooding in our area, I commend The Marcus Corp. for their support in helping Wisconsin Dells rebuild its business," said Tom Diehl, general manager of the Tommy Bartlett Show. "We look forward to welcoming The Marcus Corp. associates, along with their family and friends, at our attractions this summer."

The Milwaukee United Performing Arts Fund (UPAF) announced it has raised $10.7 million, a new record in the 42-year history of the organization.
This figure is composed of $10.5 raised through 2008 campaign activities to support member and affiliate groups and includes $200,000 in restricted revenue from the Argosy Foundation for technology improvements, $10,500 in restricted revenue for affiliate grant funding and $20,000 in other restricted revenue.
UPAF plans to allocate $8.3 million, its highest allocation in history, to benefit its 35 member and affiliate performing arts organizations. In 2007, UPAF raised $10.5 million and allocated $8.2 million to its members and affiliates. 
The announcement was made at the UPAF 2008 Campaign Finale at Marcus Center for the Performing Arts, led by campaign co-chairs Lisa Binder, president and chief operating officer at Associated Banc-Corp, and Mark Miller, chief executive officer of Whyte Hirschboeck Dudek S.C.   
"We are very grateful for the support the community has shown for the performing arts in southeastern Wisconsin," Binder said. "I would like to thank the businesses, individuals, and foundations that gave so generously to this year's campaign."
"Individuals and businesses are committed to helping the performing arts because they recognize the value the arts bring to our community and how they enrich our lives. The arts add a dimension to our society that takes us beyond our daily struggles and adds color and vitality to our experience. The arts are transformative," Miller said.
"UPAF is grateful to the community for its support of our 2008 campaign. We are thrilled to have reached this milestone, particularly in light of the challenges we faced throughout this effort," said Cristy Garcia-Thomas, UPAF president. "Some of the issues we've faced this campaign include the challenging economy, a shift in giving patterns by some corporate donors, a significant number of staff openings that required focus to fill and the recent floods. Our business community, foundations and individuals are to be commended for stepping up and helping us raise these critical dollars for our performing arts. Several companies and foundations added to their support as we came to the end of their campaign, and we are indebted to them for their commitment to our community."

Attorney Kathy Nusslock is the new president of the Eastern District of Wisconsin Bar Association (EDWBA).
She succeeds attorney Robert Gegios as the association's leader. Nusslock, a partner at Davis & Kuelthau, has been involved with the EDWBA since its inception in 2002 and has held various positions, including treasurer, board of director member and committee chair.
Other members of the 2008-09 EDWBA executive committee include: president-elect Cristina Hernandez-Malaby of Quarles & Brady; vice president G. Michael Halfenger of Foley & Lardner; secretary Matthew O'Neill of Friebert, Finerty & St. John; and treasurer William Levit Jr. of Godfrey & Kahn.
The association is committed to improving the administration of justice and fostering professionalism, bench-bar relations, and civility among those who practice in the U.S. District Court for the Eastern District of Wisconsin.

Although some real estate industry professionals and observers in Milwaukee have assumed that the proposed Rivianna project is dead, Bob Schultz, the project's developer, says he is making progress and hopes to break ground near the end of the year. Rivianna is a proposed $82 million development, with three 17-story towers, just south of the Historic Third Ward. Read more in the latest edition of the BizTimes Real Estate.Weekly bulletin.

Hotel development is picking up in Madison’s suburbs. Read more in SBT's daily roundup of headlines from newspapers across the state at www.biztimes.com/#news.

The BizTimes Stock Index fell .24 points to 146.08 Tuesday, and local stocks treaded water this morning as the market awaited the Federal Reserve Board's latest decision on interest rates later today. The largest local gainers this morning were Manpower Inc. (up $2.24 to $59.96), Kohl's Corp. (up $1.85 to $42.96) and Fiserv Inc. (up 96 cents to $48.54). The largest local decliners this morning were Rockwell Automation (down $5.39 to $46.80), Bucyrus International Inc. (down $2.07 to $73.92) and Joy Global Inc. (down $1.81 to $78.36). The BizTimes Stock Index was created by Small Business Times and is monitored by North Shore Bank. The index, which measures the stock values of publicly held companies based in southeastern Wisconsin, is updated daily and can be viewed at www.biztimes.com.

A colony of urban ground hogs appears to have hunkered down or all-together disappeared as Summerfest begins next-door to Milwaukee's Historic Third Ward. Read more in Small Business Times executive editor Steve Jagler's weekly Milwaukee Biz Blog at OnMilwaukee.com, a media partner of SBT.