Originally Posted by
ghost401
Don't mean to hijack and excuse the post from a non airline guy but there's something that I have wondered and maybe stryker might like taking it in this direction more. Where do you all see the regional industry in years to come? I remember reading this article not too long ago on how the regional business model is not sustainable.
It makes sense. Sometimes being a contract company can be a fruitful success in certain sectors. I think this is mainly true when there is not too much competition and/or there's a variety of services or goods that can be provided within that industry. Look at military contractors, there's food, uniforms, transportation, weapons etc. But with the regional airlines there's one service and no short supply of investment groups ready to throw some money at an airline.
Seems to me that with time the number of regionals will reduce through bankruptcy's, acquisitions, and mergers. And I think the remaining carriers will have to work harder at retaining pilots and the age of the regionals being a stepping stone will be gone. I really don't see as many people getting into this career considering the cost, ability to secure loans, and atp rule.
But I could be wrong and everything remains more or less the same.
The whole regional model is built upon the idea that:
Cheap pilots +
Overhead for operating an airline +
Profit for airline
Is cheaper than flying them at mainline. With the lack of new pilots and the 1500 hour rule causing a problem in the supply curve and the FTDT regs causing a problem in the demand curve, hopefully one day regional airlines will cost themselves out of existance and it will become once again cheaper to do it at mainline.