If there is a merger between AA and US Airways, could Eagle, AWAC, PSA, and Piedmont be faced with a similar situation to the one affecting Pinnacle? I know no one owns all four, but would a merged airline need the capacity all four provide? Maybe, but maybe not.

 

AWAC is not owned by USAIR! This will take years to pan out, by then, regional feed will go to who ever can staff it, your about see a massive shortage of new hires for the RJs. They will have to raise first year FO pay, and thats not an option without a contract, and everyone will want some pie. Its about to become a VERY rocky road come next AUG, and even more so the following spring with FT.DT.

 

My bet says a lot of regionals will dissolve thru merger or elimination and the 50-seat and smaller RJ's and turboprops will be replaced with larger RJ's. Since the majors won't have heavy retirements for years and they will be contracting anyways, there will be few places for regional pilots to go.

I think they'll have no problem filling the RJ seats for the next 3-5 years as the regional industry shakes out. As some carriers downsize or disappear others will expand, thus many junior will be starting over elsewhere. Pinnacle is already following Comair and which carriers are the players and which aren't has still to play out.

$5/hour more for new-hires won't be creating a stampede for the right seat of an RJ and $40-50/K year regional new-hires won't happen as that would be more then most majors who can spread their cost over more revenue producing seats of larger aircraft.

 

Your not seeing each market served. Many markets served by RJ are old turbo prop markets, such as ALB-EWR. This will not go to a 70 seat jet. Same with IAD-ABE, or SFO-SAC.

Also a vast majority of the 70+ seat RJs are flying routes previously served by 737-500/300 (90-120 seats), or 727, or DC-9. We have also seen an increase in frequency in these places, while cutting capacity. IE 2 727 (250 total seats) is now 3 CRJ 700. (200 seats). That is just odd ball numbers but I think you get my point.

I do not see routes like MIA-TLH going to a 70 seat jet, or getting dropped. Same with GNV/NAS/GGT/PNS/BHM etc. They will remain 50 seat RJs, till something makes more sense. The frequency they have now works for the hub/spoke system they run.

Same with LGA-RDU, LGA-CLT, LGA-YYZ, JFK-CLE, JFK-CVG. No other airlines really fit this route, but they feed the INTL travel.

If your predictions came true, it would mean your out on the street, since you feel more flying will be farmed out. However lucky for you, your wrong. With retirements, and lack of incoming pilots, the upward movement will be fairly steady for 15 years to come. The regional business will shrink off, as they see their staffing costs skyrocket. A319s on a B scale will more likely be the case at mainline. I think the airline owned regionals will grow starting in 2 years, as they can offer stability. The Pinnacle situation is just step 1 of a long road. Look what that did to United. Republic maybe next, which could really shake things up since CHQ flys for EVERYONE.

 

I dont think they will. If it's not dropped altogther, they will likely go to a turboprop, like the Q400 which can carry more revenue then a 37-50 seat RJ, for half the expense and do so as fast and comfortable considering the stage length altitudes flown.

They're flying a mix of routes like that, stand-alone new markets and also mixing in with larger aircraft. Larger RJ's DO have a place and as the global increase in flying accelerates and the airspace limits, it's one reason why larger capacity is necessary as long as a route is "right-sized" in both capacity and frequency.

Again, look for those routes to have a mix of aircraft size, either all regional of various sizes and propulsion or a mix of regional/mainline. If they cannot support at least three flights a day of at least Q400 size (or perhaps ATR in the south), then I'd expect them to be dropped. If dropped, another start-up code share with some refurbished SAAB's or something might be an answer for that market as a code-share, but many analysts expect many smaller towns and markets to lose air service in the future due to economics.

Any number of scenarios in the future could put me "out on the street". Considering the term sheet, if that becomes reality for an extended period of time, it may be ME putting MYSELF on the street to seek new adventures. The older you get, the more you realize how short life is. Retirements in any great numbers are 5 years off. Considering the pilot forcast, I wouldn't be surprised to see age 65 increased to age 67 or 70 if one can pass a stringent physical (probably including a cognitive test). When big businesses profits are threatened corporate power has proven to easily control governmental roadblocks (auto industry, banks and airlines, etc.)

By your own admission, you're now saying the regional airline business will shrink off, yet every indication says it has no intention of doing that (AMR certainly isn't) and instead simply morphing to larger RJ's. Since these are more economically viable and can even do MORE of the domestic operations, it only makes sense that contracting mainlines with their higher costs will not provide the escape rope for most regional pilots and thus the majority should expect to spend many years there, if not their ENTIRE careers. The regional industry WILL indeed go through its own "shake-up" via consolidation and elimination. U and UAL for example have a rediculous amount of feed providers and both will almost certainly condense that down to just enough to provide a competitive whipsaw model to ensure labor costs don't spiral higher one dime more then necessary.

 

I am not going to try and debate you about it. Your too caught up in yourself to see the reality and hypocritical irony of this.

 

Mesa is run like trash, just like PNCL. They both will be gone in 3 years because they can not make money. Mesa is a trash product, and most airlines are trying or have dumped their flying. As the RJ industry becomes harder to run, more places will see CH 11 and maybe CH 7. I think Republic is next. This is just making the whole owned RJs a better idea, as they seem to be well run, and are becoming more and more economical.

 

Disagreement with you is equal to being "caught up in myself" ?

Ummm, okay.

You see my opinion as "unreal" and thus myself a "hypocrite" embracing "irony". Well, for once I don't know how to respond to that string of connections.

I understand though.

 

I'm not sure I understand your logic. You're claiming that a wholly owned regional is LESS likely to be BK, yet AMR and therefore AE are BK. Also, it appears that AE's performance numbers in 2012 were terrible. Even Mesa beat AE. So how is it that a wholly owned Regional seems to be well run?

http://www.nbcdfw.com/news/business/...145778535.html

 

Isn't the ultimate answer to all of this that the legacy carriers just cut out the middle men, the regionals, and make RJ's part of their wholly owned fleet?

I know there are issues of scope and this isn't going to happen anytime soon, but why wouldn't Delta or United or the potential AA/USAir just decide to fly their own RJ's and staff them own their own pilots?

Maybe that model isn't feasible due to existing contracts and scope, but it would make their own forecasting and scheduling much easier. It might mean a reduction in jobs, but it might also lead to higher pay and higher time applicants.

Right now, regionals are at the whims of their bigger counterparts. How can one make projections on growth or hiring if it's all dependant on month to month dealing with the legacies?