Delta Fleet Deal Drops Close To 200 50-Seaters To Gain Larger RJs
Aviation Daily May25, 2012 , p. 1.01
Andrew Compart



Delta Air Lines will cut close to 200 50-seat aircraft operated by its Delta Connection feeder operation, about 60% of the existing fleet, under the tentative agreement reached with its mainline pilots.

The agreement limits the number of 50-seaters Delta can rely on to 125 aircraft as a condition for adding a further 70 76-seat Bombardier CRJ900 and Embraer 175 aircraft to its network. The other condition for adding the 76-seaters is that it must acquire more mainline aircraft, which Delta will fulfill if it completes a deal reached earlier this week to sublease all 88 of Southwest Airlines ’ Boeing 717 aircraft. Delta will receive about three 717s a month, starting in mid-2013, if that accord is finalized.

As of the end of March, third-party contract carriers were operating 297 CRJ200 aircraft and 26 Embraer ERJ-145 aircraft for Delta Connection , for a total of 323 50-seaters.

The tentative deal with pilots would place a new cap of 125 on these jets. Details about how quickly this reduction will begin and how long Delta has to comply with the new scope terms, however, are not being disclosed by the airline. The AirLinePilots Association , however, tells Aviation Week the 50-seaters will be cut as the 717s are added to the fleet from 2013 to 2015.

The agreement on the 717 sublease leaves several questions unanswered: If Delta’s pilots vote to approve the tentative agreement , which regional carrier or carriers will fly the 50-seaters that remain in Delta’s operation ; and which feeders will Delta use to operate the additional 70 larger regional jets?

Questions also remain about what aircraft Delta will choose to operate, and while it has unexercised options with Embraer for 36 E-175 aircraft, the airline is not discussing possible orders.

The fate of the 50-seaters, and possibly the larger aircraft, may rest with Pinnacle Airlines, which currently operates 141 50-seat CRJ200s for Delta Connection . Pinnacle is in the midst of a Chapter 11 reorganization that is funded by debtor-in-possession financing provided by Delta, which also has revised its capacity purchase agreement (CPA) to continue Pinnacle’s CRJ200 feed until at least July 2022.

While this new CPA applies to 140 CRJ200s , Delta can remove aircraft from Pinnacle’s fleet when Delta’s financing arrangement for each aircraft expires (although neither Delta nor Pinnacle will provide specific details).

Delta also can reduce the number, on a one-to-one basis, if it reaches agreements with Pinnacle for flying more regional jets with 70 or more seats.

But Pinnacle is not the only 50-seat operator for Delta. SkyWest Inc. subsidiaries SkyWest Airlines and ExpressJet Airlines operate 156 CRJ200s for Connection , while Republic Airways ’ Chautauqua Airlines division provides a further 26 50-seat ERJ-145s . Republic is trying to cut $40-60 million from Chautauqua’s annual costs to make its 50-seat flying profitable.

The current 76-seat jet operators for Delta include Pinnacle with 57 CRJ900s , SkyWest and ExpressJet with a combined 31 CRJ900s , Republic’s Shuttle America unit with 16 E-175 aircraft and Trans States Holdings subsidiary Compass Airlines with 36 E-175s . Delta also owns 13 CRJ900 aircraft that are operated by its own regional airline subsidiary, Comair .