The future of Regionals?
 

Rumors, guesses and forecasts for the regional industry.

My company (YX) has halted all new FO classes until Q3 2022, and are struggling with having more FOs than CAs. As a result, FO's aren't flying and some are struggling to consolidate, giving them a greater incentive to leave ASAP. CAs will leave as soon as they have their PIC time and get the call. So the majors (and to a lesser extent LCCs) are cannibalizing the regional workforce as it becomes less necessary to have PIC time. I don't really see the CA/FO numbers balancing out, if anything both sides will keep shrinking.

How many other regionals are struggling with the same issue? Most, if not all I figure. The WOs will be fine, maybe they'll get stapled on to the bottom of their majors, maybe not. What about the rest of us? Will one major buy us out? We're owned by all 3 majors, no controlling owner that I'm aware of. Either makes us stronger or puts us at a triple disadvantage depending on how you see it. I've asked everyone I fly with what they think will happen, they all think the regionals will "go away" but most are unsure what that will look like, especially for the non-WO's. If I was moving on I wouldn't care but I'd really like to stay if there's a future here.

So, give me your best guesses, specific or general, as to what's going to happen to the regionals as a whole, or what might happen at your company.

I think most anticipated that the Regionals would be in trouble with the upcoming retirements and hiring wave from the Majors. I think what caught most people off guard is how quick it happened.

If you are trying to stay at a regional, you should really talk to someone about that. Someone who can help you compare a small paycut for one year to the loss of pay, qualify of life, job security and satisfaction for a lifetime.

I don't want to turn this into a thread on why someone should stay or go, but we all have our reasons. For me, I want to live near family, and I won't commute. Location is my #1 requirement. The other stuff is 2nd.

In a free market, the regionals would die and die soon. But the question is how much Delta, American, and United are willing to pay to prop them up. It really just depends how bad they want it.

There is a shortage of regional CA, this will continue in the near term.

The 50 seaters will greatly reduce. 76 seaters will replace much of this lift. Same seats, fewer pilots.

Mainline will replace some of the 76 seaters. Same seats, fewer pilots.

On top of this, regionals will merge and some will go out of business.

It is a distinct probability regional flying will become part of mainline, to give them seniority numbers. This will attract and retain pilots.

I have predicted several years ago, regionals will shrink to 1/4 the number of companies (already several are out of business). Number of pilots flying regional planes will reduce to 1/2. This is already happening.

Staying at a regional does not guarantee that. My regional went away, and so much for avoiding a commute. Lots of regionals have gone away in the past and their bases folded with them. For that matter, even some mainline bases that were once there no longer are. You have no guarantees.

I think the business model of regionals is on shakey ground for the near future. It’s hard to predict what will happen to any of them. Even WO jobs aren’t safe if the legacies bring the planes in house but don’t staple (think about it for a few minutes and you’ll realize that’s more likely than a staple).

I was shocked by the amount of pay AA was willing to throw at regionals this past summer to preserve the model. But even that was a two year temporary bandaid. Is AA going to think it’s worthwhile enough to extend it? What happens if they don't? Just how long are the legacies going to be willing to overpay for regionals just to preserve the model?

I’m sure management at the regionals and Legacies that own WOs have done the math. Looked at retirements driving this unprecedented attrition at all US airlines, Maybe the cost of paying through the nose to keep the regional model propped up for the next 8-10 years by paying senior RJ CAs absurd payrates will be less than the the cost of indefinitely replacing all RJ flying with mainline operators. Even at the already ballooned pay scales RJ pilots are making, they’re still cheaper as a whole to mainline operators. (Aka: they’ll be able to pay even more down the road if things continue to worsen and they try to save this incredibly cheap option of running a large percentage of their total operation.)

Sure, the math isn’t concrete, and hypothetical numbers are being proposed to help with this equation. But I’m certain they’re making very educated guesses.

If I was a betting man, after the unprecedented wave of retirements wane the Regional airlines will come out on the backside leaner but ready to do a bunch of hiring (starting flight school now? be ready for a 6-10 year journey through the regionals), the whipsawing will resume, and regional pilots will be signing contracts for payrates that are about 50-75% of what they are currently.

There should have been an orderly draw out of regional ranks, here’s your class date, don’t screw up, see you then. That didn’t happen for the vast majority so it’s a free for all. Some will survive some will not some will shrink.