Skywest to fly for Alaska
 

SkyWest acquiring Horizon’s last 5 RJs;
Q400s may start flying in state of Alaska

Alaska Air Group announced today that Alaska Airlines has reached an initial agreement for SkyWest Airlines to acquire the five remaining CRJ-700s in Horizon Air’s fleet and operate them under a capacity purchase agreement. Alaska also announced it is considering the deployment of Horizon Q400s on some state of Alaska routes.

Andrew Harrison, vice president of planning and revenue management, and Joe Sprague, vice president of marketing, answer questions related to these two moves.

Why is Alaska entering into a CPA with SkyWest?
Harrison: Horizon’s financial success depends on its transition to an all-Q400 fleet so it can reap benefits equivalent to what Alaska gained from its own transition to the Boeing 737. That leaves a few longer routes that, for competitive and economic reasons, we need to keep serving with regional jets. SkyWest will fill that need.

What routes will SkyWest be flying?
Harrison: We’re still evaluating that and expect to have an answer in the next month or so. As always with major market changes, we’ll let employees, vendors and airport authorities in these cities know before we announce publicly. What I can say at this point is that SkyWest will primarily be flying the CRJ-700s on some of our longer-haul West Coast routes currently served with the aircraft, but not all of them. Those others will be served by Horizon with the Q400.

Why not have Alaska fly its own jets on these routes?
Harrison: We’ve found that larger jets don’t work well on these routes.

Why is SkyWest flying these routes instead of Horizon?
Sprague: Horizon will not be able to capture the economies of a single fleet until all of its CRJ-700s are gone. In addition, with hundreds of regional jets in its fleet contracted to fly for numerous other customers in similar CPA arrangements, SkyWest has economies of scale that Horizon cannot match.

When will the last five CRJ-700s begin leaving Horizon’s fleet?
Harrison: The current plan is for the last five Horizon CRJ-700s to transition out of Horizon’s fleet starting in April. All current Horizon CRJ-700 flying will either be flown for Alaska with a Horizon Q400 or with a SkyWest CRJ-700 by summer. In order to get the SkyWest CRJ-700s painted in their new livery, some of the flights may need to be temporarily operated with SkyWest 50-seat regional jets until all the CRJ-700s are repainted.

What will be the livery on the SkyWest CRJ-700s flown for Alaska?
Sprague: These SkyWest CRJ-700s will likely sport a version of the Alaska livery. A final decision on this is expected shortly.

Many of our competitors offer a first class cabin on their regional airline partners. Will there be a first class on these SkyWest-operated Alaska flights?
Sprague: Some the majors offer first class on their regional partners as a way to attract very lucrative international business and first class passenger connections. The vast majority of our customers on these SkyWest-operated routes are traveling domestic point-to-point and are very price sensitive. Our experience is that relatively few customers purchase first class seats on our short routes. We believe we’ll gain more revenue by having more seats in a single-class configuration, lowering our per-seat cost and allowing us to remain competitive with the likes of single-class competitors like Southwest and JetBlue.

Will SkyWest offer complimentary Northwest wines and microbrews like Horizon?
Sprague: Yes. This enhances the inflight experience for all customers, including those who would have preferred a first class cabin had it been available.

Why would we want to operate Horizon flights in the state of Alaska?
Harrison: In looking at the average demand for air travel on some intra-Alaska routes, we see in many cases that demand could be accommodated with a 76-seat Q400 and at a lower cost. Replacing Alaska mainline flying with the Q400 would allow us to reduce costs and lower fares on the routes and give us the opportunity to re-deploy 737s on other routes where they can be more profitable. Our commitment to air cargo in the state of Alaska remains unchanged, and that service will continue to be provided primarily by Alaska Airlines, due to the size and quantity of cargo involved.

When could we see the first Horizon Q400s in the state of Alaska and where would they operate?
Harrison: It’s too early to tell, because it’s not a done deal yet. Scheduling people in my group and operations folks at Horizon and Alaska are working up possible scenarios. Should we decide to proceed, it would likely involve two or three Q400s and would not take place before the end of this year. Once we arrive at any decisions, we’ll get the word out.

That's disappointing to hear for Horizon.

I wonder if Skywest will open a PDX or Sea Crj domicile.

Doesn't SKW already have a PDX pilot base for the Bro?

If they do, I am sure it will go extremely senior for all crew members.

Yes, SKW has a PDX brasilia base and a PDX or SEA jet base will go very senior. On the bright side for Horizon I'm sure you have guys who would love to go to Alaska.

So what's going to happen to the guys that just got recalled and the 6 new hires at Horizon?

No announcement of any kind to the employees of SKW yet.

It's up now, but it doesn't say much more than the Alaska/Horizon FAQ.

The announcement implies that QX will continue to operate the Q400's.

Theoretically, all the jets are being replaced on a one for one basis by Q400s. So all those pilots should be safe.

I'm pretty sure QX is shrinking from 53 total airplanes to 48...

All your base are belong to us

That is correct.

Ummmm.......what??? :confused:

Google it for a laugh.

Unless we order more a/c we will have to furlough and downgrade. I think they were planning on more people jumping ship but things have slowed down. With this news it might kick folks of the fence who wanted to stay for the NW base.

It would be nice if Skywest could give preferential interviews to our poor Fo's who are about to be thrown under the bus yet again.

So the word on the street is to furlough again after the recalls and new hiring? Or is this just speculation?

That was pretty funny. Had a few girls in office dancing around. Nice distraction.

The Alaska pilots can't learn to fly CR7s?

All your base are belong to us - Wikipedia, the free encyclopedia

YouTube - All Your Base Are Belong To Us

Probably the most important question asked in that interview!

Yes, the FAQ says we will serve wine, local microbrews, and Starbucks coffee.

I'm too lazy to look this up, but are SkyWest pilots payed as well as the Horizon pilots? If not, the bar appears to have been lowered again. WAAAAAY TO GO!!!!!!!!!!!!!!!!!!!!!!!

Horizon CR7 CA 18 yr $121

Skywest CR7 CA 18 yr $102

Horizon's most junior CRJ Captain (on my last list) had 14 years seniority (1996 hire). So that's (or was) $107/hour minimum for CRJ Captain's at Horizon.

To get at or above $100/hour at SkyWest you'd need to be there 17 years...

You cannot compare Horizon to SKW since SKW is an Express operator operating under a F4D contract and Horizon operates as own airline (not an express carrier). However I believe Horizon has accepted a concessionary contract (I think the rates are not public yet) and is being converted to an Express operator. Sad to see.

Horizon's business model has been already been changed. We are now solely operated under a capacity purchases agreement.

As to the rates not being public, there are no rates. We have pay freeze for the first year. Years 2 and 3 will be determined by the first round of arbitration. Years 4 and 5 will be a second round.

As to the contract being concessionary, that waits to be seen (depending on arbitration outcome). I am not hopeful. However, if the new rates are voted in over at Colgan that will help. Unfortunately, we did concede in a few areas. But it was a tit-for-tat with us getting concessions out of the bean counters too.

Horizon has operated as it's own airline since it started, and roughly 40% of the company flying was a CPA for Alaska.

Horizon is now 100% CPA for Alaska. Horizon's reservations, marketing, etc were all merged in with Alaska's to eliminate overlapping jobs.

Horizon's new contract has the rates in it, but they will be going to a baseball style arbitration after a year.

So as of now, yes, you can compare the two. Simple fact is, SkyWest is going to be flying Horizon aircraft (since they're subleased) on routes that Horizon had been flying...only difference is the crew that's on the inside, and you cannot argue that SkyWest crews are paid on the equals of Horizon crews.

On hourly rates alone I will not argue but as we all know rates don't tell the entire story. I do not have Horizon's contract so I cannot do a just comparison. Regardless, it's not our payrates that caused this, if so then Mesa would be flying QX's CR7's.

When do you guys expect the arbitrators ruling? It’s sad to see Horizon fully join the CPA ranks. We all know it’s not the best place to be.

12 months.

Don't worry about comparing the contracts. Our managers completely ignore and **** all over at anyway. Managers - "we haven't decided to turn that part of the contract on yet". Except that part of the contract was on from the day we both agreed to start following it.

Welcome to Capitalism. Here's your card...

The economies of scale SkyW uses to its advantage is really the tipping point. Also, a very good credit rating (making money cheaper to borrow) adds to the leverage SkyW uses. The W2's between 15 year Capts at Horizon and SkyW are not too far off. Like another post said, if it was simply pay scales, Mesa would rule the world.

The only wasy to stop this is a national senority list. Someone will eventually offer the service cheaper, a lesson I hope SkyW has learned.

I think SkyW will offer pref interviews to anyone from Horizon.

Having worked at both co's. The work rules at SkyW are better, though QX benefits are better. Money made at SkyW is about the same and I know from personal exp. that RJ fo's at skyw make as much or more than at QX. Pick which side the grass is browner at.

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Is Skywest going to do Cat III approaches with the QX airplanes?

I wish that Alaska pilots and many others would learn how!

My bet is "no". No way they train 3000 pilots on it for 5 planes. Maybe if they have dedicated Alaska Express crew.... which I doubt ...

I've been told they are yanking out some of the equipment. Maybe no Cat III. But who the **** knows...