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Subcontract Airlines (Part 121 "Regional")

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Subcontract Airlines (Part 121 "Regional")

Old 05-31-2010, 05:55 PM
  #31  
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The pilots that are most at fault here are the ones that voted for such outsourcing to begin with. I remember a conversation with my father when Eastern started operating Twin Otters out of San Juan with outsource pilots because EAL pilots said they wouldn't fly turboprops, "it is the beginning of the end of a respectable career" he said. What he could have never envisioned is that outsourcing is one of the contributing factors for us to be the lowest paid pilots of all industrialized nations
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Old 06-01-2010, 12:45 PM
  #32  
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I would like to see this happen.
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Old 06-06-2010, 03:04 PM
  #33  
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Originally Posted by Copperhed51 View Post
I'm on board with changing the name to Contract Airlines. It is definitely more accurate.
How's that work with the wholly owned ones? Not sure about now, but I know at least one company didn't have anything in writing with their legacy partner.... no contract at all other than fee schedules for what they charged for ramp services. I'd bet that was fairly common with the wholly owned ones, as the lack of formal structure means they can act/react more quickly to parent company needs.
Why not just use the DOT ratings... and categories. That woud make it easier for everybody to know who is being talked about.

Major
National
Regional

and bring back commuter, for things like Cape Air, Colgan etc....
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Old 06-07-2010, 06:52 PM
  #34  
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Originally Posted by Mason32 View Post
Why not just use the DOT ratings... and categories. That woud make it easier for everybody to know who is being talked about.

Major
National
Regional

and bring back commuter, for things like Cape Air, Colgan etc....
Mason32,

These definitions do nothing to describe the relationships between the airlines and the types of operations these airlines perform. There are no universially agreed upon terms for airline type definitions. The DOT airline categories you refer to are based solely on revenue alone for government accounting purposes and are actually called "Groups" . The terms "Major, National, Regional, Commuter, etc. have always been ambiguous terms used randomly by different parties to suit their political needs and often quoted, especially by misinformed media.

Some Group III Carriers are often referred to as "Major" while others are called "Regional". Under the revenue definitions, American Eagle, Atlantic Southeast, Comair and Skywest can all be considered "Major" airlines although their true function is to separate labor groups and create a lower scale of income and quality of life for their respective employees.

The latest Air Carrier Groupings (Financial) were established by the DOT on November 13th, 2009:

Group III Air Carriers (Over $1 billion) - 21

ABX
Air Tran
Alaska Airlines
American Airlines
American Eagle Airlines
Atlantic Southeast
Atlas Air
Comair
Continental
Delta Air Lines
Federal Express
Frontier Airlines
Hawaiian Airlines
Jet Blue
Northwest Airlines
SkyWest
Southwest Airlines
United Airlines
UPS
USAirways
World Airways *


* Reporting in Group III by waiver.

Group II Air Carriers (Over $100 million to $1 billion) - 32

Air Transport Int'l
Allegiant Air
Amerijet
Arrow Air, Inc.
Astar
Centurion Air Cargo
Colgan
Compass
Continental Micronesia
Evergreen Int'l
Executive Airlines
ExpressJet Airlines
Go Jet
Horizon Air
Kalitta Air Service
Mesa Airlines
Mesaba Airlines
Miami Air International
Midwest Airlines
North American Airlines
Omni Air Express
Pinnacle
Polar Air Cargo
PSA
Republic Airlines
Ryan International
Shuttle America
Southern Air
Spirit Air Lines
Sun Country
USA 3000
Virgin America


Group I Air Carriers (Over $20 Million Operating Revenues) - 13
Carrier

Aerodynamics, Inc.
Aloha Air Cargo
Asia Pacific
Capital Cargo International
Casino Express
Florida West
Lynden Air Cargo
Lynx Aviation
Northern Air Cargo, Inc.
Pace Airlines
Tatonduk Outfitters d/b/a Everts
Tradewinds Airlines
USA Jet Airlines


Group I Air Carriers (Under $20 Million Operating Revenues) - 11
Carrier

Ameristar Air Cargo
Avjet Corporation
Falcon Air
Gulf & Caribbean Cargo
Kalitta Air Charters
Murray Air d/b/a national Airlines
NetJets
Sierra Pacific Airlines
Sky King
Swift Air
Victory Air

I propose separating the DOT Airline Group accounting definitions from the operational type definitions. The term "Regional" is a misnomer and needs to not be used when describing the type of flying these airlines perform. Many of these (whipsaw, outsourced, b-scale) type airlines are actually larger and generate more revenue than the "Major" partners they were designed to undercut.

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Last edited by winglet; 06-08-2010 at 05:17 AM.
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Old 06-08-2010, 04:40 PM
  #35  
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Originally Posted by winglet View Post
Mason32,

These definitions do nothing to describe the relationships between the airlines and the types of operations these airlines perform. There are no universially agreed upon terms for airline type definitions. The DOT airline categories you refer to are based solely on revenue alone for government accounting purposes and are actually called "Groups" . The terms "Major, National, Regional, Commuter, etc. have always been ambiguous terms used randomly by different parties to suit their political needs and often quoted, especially by misinformed media.

Some Group III Carriers are often referred to as "Major" while others are called "Regional". Under the revenue definitions, American Eagle, Atlantic Southeast, Comair and Skywest can all be considered "Major" airlines although their true function is to separate labor groups and create a lower scale of income and quality of life for their respective employees.

The latest Air Carrier Groupings (Financial) were established by the DOT on November 13th, 2009:

Group III Air Carriers (Over $1 billion) - 21

ABX
Air Tran
Alaska Airlines
American Airlines
American Eagle Airlines
Atlantic Southeast
Atlas Air
Comair
Continental
Delta Air Lines
Federal Express
Frontier Airlines
Hawaiian Airlines
Jet Blue
Northwest Airlines
SkyWest
Southwest Airlines
United Airlines
UPS
USAirways
World Airways *


* Reporting in Group III by waiver.

Group II Air Carriers (Over $100 million to $1 billion) - 32

Air Transport Int'l
Allegiant Air
Amerijet
Arrow Air, Inc.
Astar
Centurion Air Cargo
Colgan
Compass
Continental Micronesia
Evergreen Int'l
Executive Airlines
ExpressJet Airlines
Go Jet
Horizon Air
Kalitta Air Service
Mesa Airlines
Mesaba Airlines
Miami Air International
Midwest Airlines
North American Airlines
Omni Air Express
Pinnacle
Polar Air Cargo
PSA
Republic Airlines
Ryan International
Shuttle America
Southern Air
Spirit Air Lines
Sun Country
USA 3000
Virgin America


Group I Air Carriers (Over $20 Million Operating Revenues) - 13
Carrier

Aerodynamics, Inc.
Aloha Air Cargo
Asia Pacific
Capital Cargo International
Casino Express
Florida West
Lynden Air Cargo
Lynx Aviation
Northern Air Cargo, Inc.
Pace Airlines
Tatonduk Outfitters d/b/a Everts
Tradewinds Airlines
USA Jet Airlines


Group I Air Carriers (Under $20 Million Operating Revenues) - 11
Carrier

Ameristar Air Cargo
Avjet Corporation
Falcon Air
Gulf & Caribbean Cargo
Kalitta Air Charters
Murray Air d/b/a national Airlines
NetJets
Sierra Pacific Airlines
Sky King
Swift Air
Victory Air

I propose separating the DOT Airline Group accounting definitions from the operational type definitions. The term "Regional" is a misnomer and needs to not be used when describing the type of flying these airlines perform. Many of these (whipsaw, outsourced, b-scale) type airlines are actually larger and generate more revenue than the "Major" partners they were designed to undercut.

winglet
The problem with this is that FFD carriers report revenue differently depending on their CPA, ASA, or pro-rate agreement.
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Old 06-08-2010, 05:23 PM
  #36  
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Originally Posted by Nevets View Post
The problem with this is that FFD carriers report revenue differently depending on their CPA, ASA, or pro-rate agreement.
Nevets,

This is exactly my point. I was trying to show the nonsensical way the media and the industry categorize airlines. The lines have been intentionally blurred between "Major" and "Regional". Describing airlines based on revenue is a poor way to catagorize airlines and provides no information to the public as to the type of operation.

Outsourced airlines are not "feeding" "mainline" any more than they are "regional". The "major" airlines are not even "major" in many cases. "National", "Commuter", "Air Taxi", etc. no longer apply.

Let's stop hiding the outsourced airlines from the public. Better terms need to be established to shed light on the Contractor Airline/Outsourced Airline relationship. If the aircraft you are in has another airline's logo on the tail then you are flying on an outsourced/contracted aircraft. This also applies regardless of the "wholly-owned" status.

winglet

Last edited by winglet; 06-08-2010 at 06:00 PM.
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Old 06-13-2010, 06:34 AM
  #37  
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Originally Posted by winglet View Post
Nevets,

This is exactly my point. I was trying to show the nonsensical way the media and the industry categorize airlines. The lines have been intentionally blurred between "Major" and "Regional". Describing airlines based on revenue is a poor way to catagorize airlines and provides no information to the public as to the type of operation.

Outsourced airlines are not "feeding" "mainline" any more than they are "regional". The "major" airlines are not even "major" in many cases. "National", "Commuter", "Air Taxi", etc. no longer apply.

Let's stop hiding the outsourced airlines from the public. Better terms need to be established to shed light on the Contractor Airline/Outsourced Airline relationship. If the aircraft you are in has another airline's logo on the tail then you are flying on an outsourced/contracted aircraft. This also applies regardless of the "wholly-owned" status.

winglet
Well, then I guess by your standards, American Airlines is a contract airline, that is owned and operated by it's parent company AMR.

It's sister company (Eagle), also owned by AMR (not by AA) would likewise be a contract company.


Conversely, Comair is owned by DAL and is subsidiary so it would be contract company then right? But then again, all profit created by Comair stays at DAL with their shareholders... so where does that leave RAH doing their contract work for DAL but taking the profit away from the parent company.

I do understand what you are saying; but you are just trading one set of misunderstandings for another.

When places like RAH are profitable enough to buy two large plane operators in one year then were is the profit in this industry? It certainly isn't at the legacy... and that being the case, where do you expect the growth to be?

Changing names isn't going to change the facts except to make you feel better.
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Old 06-17-2010, 01:05 PM
  #38  
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Mason,

I think you're splitting rabbits. AMR is a holding company. It produces no product, nor does it sell anything to anyone (except maybe stock to investors).

American Airlines is the 'brand name' airline that sells tickets and cargo space.

American Eagle is a lift subcontractor that has no capacity to sell its product to the general public.

The distinctions are pretty clear to all of us who are familiar with the airline business.


It shouldn't be that hard to differentiate those airlines who sell to the public, and those who sell to other airlines. If the term 'Major' is no longer adequate how about 'Real' airlines and 'Subcontrator' airlines?
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Old 06-17-2010, 06:19 PM
  #39  
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Originally Posted by robthree View Post
It shouldn't be that hard to differentiate those airlines who sell to the public, and those who sell to other airlines. If the term 'Major' is no longer adequate how about 'Real' airlines and 'Subcontrator' airlines?

I like "subcontractor" airlines to differentiate them from contract (pilot) airlines that most of the developing world have.
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Old 06-18-2010, 10:02 AM
  #40  
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Originally Posted by robthree View Post
Mason,

I think you're splitting rabbits. AMR is a holding company. It produces no product, nor does it sell anything to anyone (except maybe stock to investors).

American Airlines is the 'brand name' airline that sells tickets and cargo space.

American Eagle is a lift subcontractor that has no capacity to sell its product to the general public.

The distinctions are pretty clear to all of us who are familiar with the airline business.


It shouldn't be that hard to differentiate those airlines who sell to the public, and those who sell to other airlines. If the term 'Major' is no longer adequate how about 'Real' airlines and 'Subcontrator' airlines?
Interesting, but not entirely accurate.... there are several cases where you can buy tickets directly from the smaller carriers, even places like Cape Air... you can buy the ticket from them, or get it from their mainline partners on interline and codeshare agreements.

so who sells the ticket doesn't exactly work either.

You're trying to exchange one set of often misunderstood things for a whole new set of soon to be misunderstood things.

I agree, It would be better to have the Govt and Indudstry titles match better... and changing the DOT standards to match a modern economy would be the first step.


Oh, and while I agree Eagle is a lift provider, it is harder to call them a subcontractor since they are a sister company. Up until Eagle was placed on the for sale block in 2007, I am told they didn't even have anything in writing at all with AA about providing lift on contract.
There is no stock that says AA on it, there is no stock that says Eagle on it.... the only stock you can buy is AMR.

Delta on the other hand owns several of their regionals as subsidiary companies. Delta also outsourced (subcontracts) to several non-owned airlines. This pattern is repeated at other carriers as well.
The profit from those owned regionals stays at Delta and with Delta's shareholders.

A primary function of any company is to provide a return to their shareholders... the company has little obligation to make your life easier, or change titles or what they call other companies to make you feel better. Outsourced, Subcontractor, Owned, Regional, Commuter.... it's all the same. What's your flavor of the month? The fact is the flying belongs to the company, not to you and not to your union, if your agreement with the company allows them to hire outside companies, and that makes more financial sense to do for their shareholders, then that is what they will do. Changing their name doesn't change anything except to make people such as yourself feel better.

It's no skin off my teeth, I just think it's a monumental waste of time. We are our own worst enemies, we let scope out of the bag, and changing the name of the companies that got that work won't change a thing except make you feel better, and further divide all off us as airline pilots.

I don't care if it's the guy/gal sitting right seat in a B1900 or the guy sitting left seat in a 777. We're all pilots, and it's time we started acting that way, instead of always fighting with eachother, and trying to put eachother down.

Last edited by Mason32; 06-18-2010 at 10:14 AM.
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