Transportation Dept. Asked to Probe TWA : Union: Icahn Plan Perils Airline Safety

The union representing flight attendants at Trans World Airlines, which has had a long-running battle with Chairman Carl C. Icahn, asked the Department of Transportation on Tuesday to investigate the carrier’s ability to continue operating safely.

The union is charging that Icahn’s plan to take the nation’s sixth-largest air carrier private could jeopardize the airline’s safety and its financial health.

Icahn said in a statement that the charges were “spurious, malicious and erroneous.”

The union said Icahn has taken TWA “to the brink of serious financial problems that may potentially threaten public safety and the long-term economic viability of the airline.”

Icahn, a wide-ranging corporate raider who has made bids for USX Corp. and Texaco Inc., bought control of TWA in 1985.

Icahn said the airline, which he described as close to bankruptcy when he took it over, was now in strong financial condition with about $1 billion in cash and marketable securities.

The union, the Independent Federation of Flight Attendants, went on a 10-week strike in March, 1986, after rejecting his demands for deep wage and benefit cuts. The strike failed to win concessions, and the attendants accepted a company-imposed contract.

TWA’s profits have turned around since then. In 1985, the carrier lost $193 million before the wage cuts were enacted, while in the first half of 1988 it earned $44.7 million on revenue of $2.06 billion.

But the union said the new-found profits have been due largely to one-time gains and accounting changes, such as the sale of assets and reductions in pension contributions. Outside factors, such as a sharp reduction in aviation fuel costs, also contributed.

The union said the DOT should look into whether Icahn has drained the airline of needed cash.

The Transportation Department said it was studying the petition and would decide within the next few days how it plans to proceed.

“They’re asking for very fast action on it,” said DOT spokesman Bill Mosley. “Normally we don’t move that quickly.” But he said the department had ruled nothing out at this point.