Originally Posted by
Tyrion
A bigger problem might not be that flow might be gone in bankruptcy, but that Envoy might be gone in bankruptcy along with one or both of the other WOs. If flying demand remains low that AAG has to reduce its regional footprint, they still have to honor their contracts with Skywest, Republic, and Mesa. They also have to honor scope with APA. One of the easiest ways to accomplish that would be to shut the doors on a WO or two or three.
Look at the TERMS of the scope agreement with APA. Now understand that APA does NOT look upon you as junior comrades and eventual buddies. You, far more than the ULCC crew that together are pulling down $320- 350 a flight hour are the cheap competition they are fighting against. NK and F9 may be competing with them for pax, but they are at least competing at a sizable fraction of APA PAY, not at $140 an hour. And that to fly THEIR Pax In THEIR company’s metal. Which is what scope is all about.
So scope is limited - both as to total flight hours and to total number of regional aircraft (limited to a percentage of mainline narrow bodies). The early retirement of the E-190s and the older 737s, coupled with deferrals of the Future 321XLR orders combined with the decreased overall flying is going to mean that something has to give and decreasing assets they control will actually be cheaper than paying a premium to cancel contracts.
So yeah, lose a few more aircraft in bankruptcy and push could really come to shove...