Originally Posted by
Truthanator
The rates are indeed less than half. I was making a simplistic statement.
You tried to turn it into a complex problem that has a whole slew of other factors. Now you don't want to address all the other factors that make your logic "logical".
So, not really the "end of the story there", is it.
If it is so much cheaper, as you are trying to claim, then why does it exist as it does?
Regionals exist because there was a time in the not to distant past where regional prices were rock bottom cheap. However over the last couple years significant pay raises, improvements in work rules, retention and new hire bonuses, and the signing of new CPA contracts with the majors has closed that gap.
There will be a time where the cost benefit of a regional will not be there and I believe we are approaching that point. When the major has to buy the regional, raise the employees pay, provide bonuses and THEN pay for the upper management structure and the CPA it quickly becomes cost prohibitive.
I don't know what those numbers are but I have a strong feeling that United, with this negotiated contract due in 2019, will become the first legacy to fly a 76 seat aircraft (or whatever they decide to configure the current 76 seat jets to). It will be a trial run that will either succeed or fail. If it succeeds CPAs will not be renewed and the aircraft will be brought in house as the current CPAs expire. If it fails the old scope section will come back into play.
Regionals are bloated and expensive on every level and the experiment that started in the mid 90's is coming to an end.