Partly because the company isn't taking in the revenue to justify the salary of the mechanics. It's one thing if the company is prosperous and raking in the profits, but in the case of NWA it was not by any standards. So they are handcuffed by the union labor, then if they are forced to pay them what happens? The company will issue new debt to cover the increase in cost in hopes of increasing revenue in the future. Then when revenue doesn't increase they go bankrupt, the employees are fucked (26% paycut lookin good at this point), and now the bondholders are mostly fucked too!