Skywest buying horizon
 

Heard rumors skywest will purchase horizon in a few months, any truth to that?

According to some of the "uber-senior" captains here, Skywest made a semi-serious effort to buy Horizon back in the mid-80's. The deal fell through but the "Skywest buying Horizon" rumor seems to rise from the dead every four or five years. I'd say that such a deal is at least plausible. Horizon is in the process of winding down Q400 operations, leaving us with a fleet of 30-40 E175's (an aircraft type also owned and operated by Skywest). It's also possible that Air Group management doesn't want to be in the regional airline business any longer. Why not outsource regional flying to one carrier?

There's also an argument to be made for keeping Horizon around as a separate entity. To put it simply, senior Air Group management are "control freaks". They like the ability to play us against Skywest. Maybe we get sold, maybe not, but it will come down to an economic decision, not an emotional one. The pilots will be the LAST to know.

No. There is no truth to that.

It’s all the “SkyWest wage review” language in the QX TA that has the rumor surfacing…

I don't know why that would start the rumor. It looks like to me that the ExCo just didn't want to watch Skywest rates skyrocket ahead of QX rates again.

Seems plausible to me. I've always heard (from sources who very well could be totally full of crap) that SkyWest operated Alaska flights are significantly cheaper than Horizon operated flights. Mostly given to OO's scale (200+ E-Jets, in-house mx & engine shop savings, etc). So if I was Alaska looking to tighten the belt and give up on fighting to attract regional pilots...having Horizon get absorbed by OO would make a lot of sense.

Yep agreed. It makes sense from a purely business stand point in many ways. For the record I don’t think it’s going to happen anytime soon, SkyWest doesn’t want to deal with unions and after the Expressjet debacle it would have to be a very very good deal I would imagine. But it’s a strange new post covid lockdown world we live in, so who knows anymore.

Makes little sense. Alaska error group has always enjoyed keeping rates low by pitting Skywest against Horizon. When the dust settles, and regional rates have reached equilibrium, they'll want to do so again. If AAG sold of Horizon to OO they'd be handing them all the cards to play in negotiating fee for departure rates as well as tools AAG's competitors would leverage against AGG itself. The only way they sell QX to 00 is if they're hurting for cash flow and that is not the case.

How long is the contract with Skywest to fly their 30 aircraft for Alaska?

They don't need QX to play against OO. They did need to OO to keep QX in check, since that camel always had it's nose under the tent.

They can readily get rid of QX since regional costs will be driven by staff shortages and market forces for the time being. So no benefit to whipsaw for a while.


If QX is an expensive nuisance (they are), maybe now's the time to get out of that biz.

Later on if they need somebody to keep OO honest, there's always mesa.

Not saying it's going to happen, but if it is now's as good a time as any.

They can even let the pilots keep their flow.