If your were Pinnacle MGMT, what would you do with COLGAN?
 

Hey guys, just an idea that has been going around my head. What is PNCL going to do with Colgan? All I hear is that Colgan is only costing money to PNCL CORP. and that PNCL airlines is carrying the weight. Second question, what would you do with Colgan if you were uncle PHIL?
Personally I think I would defenetly get rid of the 1900s and start phasing out the Saabs. I would also close some bases and start working my way towards and all Q400 operator. Bad thing is that 400s cost a lot of money, and the Saabs are really cheap but not money makers. Still though, I think large modern turpoprops are the answer to fuel costs.
I'm just writting this because I'm bored, and would like to hear some ideas just for fun. I don't want to start a bashing thread, if you wan't to bash, I couldn't care less......but at least try to sound intelligent.

The SAABs make money hand over fist, you have been misinformed.
Secondly why would they put a Q400 on an EAS route that normally sees maybe 40-50% load factors on a SAAB?

Well if the Saabs make money what is the problem with Colgan? I don't have numbers obviously, and when you say that the Saabs make money maybe you could share some numbers or facts. What I'm trying to say is that there's somthing not working right in Colgan and maybe the fleet structure is one of the biggest problem.

One thing they are doing is dropping the EAS flying, so they can rebid it and get paid more. Hopefully someone else undercuts them...doubtful though.

they sure aren't losing money by paying the crews well

I'll drink to that!

mismanagement is a problem at culligan, but not the biggest culprit. PCL is fee for departure, colgan isn't except for the q400 operation. Colgan takes home all of the ticket revenue for the seats it sells, but it also incurs all the costs like fuel, ticket sales etc. EAS and the airways flying are kicking our butts right now. Colgan is eating the cost on the fuel, and that why they are rebidding the EAS contracts. Our airways contract is up in Nov 08 i believe. Expect to see some changes there. Repos, crew movements, fuel, all that adds up. Colgan always operated on a small margin to begin with. read the last 10Q page 35:

http://library.corporate-ir.net/libr...267970/10Q.pdf

if you read page 36 it also says that pcl pilots are paid below industry wage and it's of the utmost importance for pcl to reach an agreement with alpa, lol. I can't believe the SEC lets them file some of this stuff

The saabs only had a 2-3% profit margin BEFORE the recent gas prices at 100$ a barrel. Well below industry average. Most regionals get a about a 5% profit margin. The Q's a 5-7% profit margin depending on completion, ontime etc.....

I can see some Saabs going bye bye, a while before all of them go...

The Saab at Colgan only had a 2-3% profit margin BEFORE the recent $100 a barrel oil. The regional airline norm is about 5%. The Q400 is about a 5-7% depending on bonus incentives (fuel saving, completion, ontime etc).

I see a reduction in Saabs starting at the end of this year unless oil goes below $70 (dobtful).

If I were PNCL I would merge the companies for synergy, stop flying for Saabs at Airways, beef up United and CAL and give the pilots a contract.

transfer the fleet to pinnacle starting with the q 400s