Just read the Boyd analysis. From that whole report did anyone read anything about scope. Do you people really believe scope will not be changed. Boyd completely avoided talking about this. WHY?

Who is this report really finaced by, unless you are to believe that BOYD did this because they had a few minutes spare to do an analysis.

 

I don't believe he is predicting Eagle's demise---just a reduction in the highest cost/least-revenue-producing units, the ERJ-135/140 series RJs that cost too much to operate, burn too much fuel and don't have enough seats to make operating them economically viable.

I think his analysis regarding older Eagle jets is correct---they're liabilities that will be shed at the 1st opportunity in bankruptcy. If scope relief is forthcoming (an explosive issue), then AE could operate more CRJ-700s with ATRs and a few ERJ-145s/50-seaters. But don't expect AMR Eagle to remain at 300+ aircraft.

 

The ATRs are OLD. Nobody but Boyd thinks they will be around, much less 39 of them, by 2016. I suspect a lot more EMBs will survive, but probably not the 135s, and most 140s, but I would be surprised if AE lost any CRJs, and possibly gaining more from scope relief.

Boyd also has some facts wrong in his tables. AE doesn't have 39 EMB-135s operational in 2011. More like 20 or so, maybe. 18 or so are parked in the desert.

Boyd hates Eagle. He also predicted Eagle being parked previously, like all of it, after 9-11.

Eagle makes money. To cut back a money making operation seems illogical.

 

It has already be stated that AE intends to shed the ATRs as their leases come due. Also, if we get rid of EMBs, it will be mostly because AA diversifies its feed, not because the EMBs are inefficient.

 

the MD-80 burns twice as much fuel as an E-140, but carries three times as many pax as the ERJ. The lease prices are similar. Cost per seat mile is MUCH higher on the ERJ.

The 737-800 burns about 20% less than the Super 80's, and carries about 10-15 more people than the Super 80, along with lower MX costs.... Now take that against the ERJ, its not even close.

RASM-CASM needs to be a positive number and a pile of ERJ's makes that a difficult prospect.

 

So we can expect to see 737s on routes such as: TLH-MIA, FAT-LAX, FAR-ORD, TYR-DFW etc?

 

Not likely. The turbo prop is making a comeback. You'll probably see some of those. It's hard to swallow because the results aren't pretty for a lot of people, but the 50 seat RJ is highly inefficient. The CASM is just too high to make revenue, and they truly are a dying breed. DAL is shedding them at a rapid rate. AMR's BK is basically a free pass to do the same.

Please understand, I don't wish job loss on anyone. But the reality of the airline industry is in order to survive, one must adapt. It's obvious that barring a massive change, oil is not coming down to a price that will make the 50 seater once again profitable. Continental parked all of ExpressJet's E-135 years ago, and I can't see AMR keeping either the E-135's or E-140's. BK is a golden opportunity to shed a dying, money losing aircraft.

Good luck to everyone effected by AMR's BK. It's not a fun situation for anyone.

 

WWSWD (What Would Southwest Do)

Stop serving those markets, if they can't support a jet or an efficent turboprop.

 

Southwest doesn't have 777s to fill

 

Its not only fuel (a huge part of the equation) but the per person operating costs are just too high even without fuel. Back in the RJ heyday, the main reason you wanted them was to raid another airline's hub/network with a low segment cost (even if it was a high per pax cost) so every airline panic ordered a million of them. Once everyone had a ton of them, no one had a competitive advantage from them. In addition to fuel going way up, most of the RJs were bought at real estate bubble-esque prices from the MBA blunder mass order peak.

This is one area that will be a huge win for AA. Getting out of the RJ albatross at rock bottom demand for the airframes. The ones they end up keeping will be almost free. The other legacies were trying to beat up on their aircraft leases in BK when the RJ was at bubble prices. Add that to the multi billion dollar mistakes/mistiming of the era of RJ outsourcing.