JuniorFO

They own as much as they legally can.

Spent $70M, at least 25 EJETs (rumored 60), $27k bonus, and they now make 50 cents on every dollar of profit at XJT. I think they care.

TheWeatherman

It is definitely looking better for the multi-carrier Regional then it did a few months ago. Any thoughts/rumors that the Majors were looking to squash off some of the smaller Regionals and consolidate were quickly put to an end with the new deals Mesa, Expressjet, and GoJet just got. Now can we put an end this silly nonsense which is just as ridiculous as thinking there is any sort of pilot shortage out there.

captive apple

Good math.
When express jet was losing money per departure, how much the profit was United making? 100%.

stabapch

Lol there will be no death to the ‘multi-carrier regional.’ On the contrary as history shows WO’s are the first to go. The pilots ask for more, management doesn’t want to pay out so they say bye bye. Comair come to mind?

United doesn’t have any controlling stake in any regionals. Although they want to so they can jump on the ‘flow’ bandwagon like AA and cut more costs, but fortunately their FA contract prevents this. Their management is clearly out in left-field, since the whole point of regionals is performance, then cost savings. Their decisions are evidently based on cost savings only. Maybe learn from Delta if they’re trying to re-shape their strategy for ‘customer satisfaction’? But, time will tell how many mis-connects and cancellations these sub-par regionals will give them, leading to any cost savings at all...

stabapch

Not too sure about this considering they’re still scrambling looking for pilots. Yet there are a lot of guys out there still accepting CJO’s from OO and YX with extended waits for class dates. But, we shall see this summer.

ninerdriver

How much of that 100% does UA get to keep making, because hey it's still FFD? 100%.

If UA/Man/whatever turns XJT around, then United gets to keep 100% plus 50% of whatever profit on top of that, according to your math.

DeltaTango

This!

Sent from my SM-G950U using Tapatalk

rickair7777

Yes.

WO's serve as "capacity accumulators"... majors can use them to quickly downsize (or possibly increase) regional flying as and if needed. The downside/risk of a WO is that the camel gets it's nose under the tent and starts thinking it's part of the family and deserves mainline compensation... that is mitigated with maintaining outside, competitive, sources of regional flying, and if necessary liquidation ala comair.

The independent regionals tend to own their own aircraft, which saves the major the financial burden of ownership but also requires longer-term fixed contracts to incentivize the regional to buy planes... nobody is going to incur a 20-year mortgage/lease obligation to acquire 50 planes for a three-year contract. OO for example typically likes 10-15 year contracts, with 15-20 year mortgages. They will incur some "tail risk" at the end of a contract, but not much more than five years.

The "multi-carrier" aspect is key here... OO for example knows with multiple major partners it can probably find homes for tail risk planes if they are not renewed by the original partner... this has played out numerous times. Essentially the big multi-carrier regionals serve as shared RJ pools for the legacies.

Varsity

The same 'family' bought a regional out of bankruptcy and gave them the highest rj pay rates in history.

The entire regional industry is being squeezed by high labor rates, bad PR, expensive oil, slot constrained airports and aging airplanes.

EFBprobs

I dont think mainline wants all WO. They want to have a race to the bottom for contract price.