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What's stopping the majors?

Old 04-24-2014, 01:09 PM
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Default What's stopping the majors?

Pardon the dumb beginner question, folks. As you can tell I'm a total noob to the 121 industry.

But my question is: What's stopping the majors from bringing all regional flying in-house? In most cases they already own or lease the aircraft being flown by their regional partners (Skywest being a bit of an exception, in that they own quite a lot of their fleet.) So they've already got the airplanes, the gates, the routes, etc. The pax wouldn't notice a difference; they already book their tickets on the mainlines, and I'd guess that most of them haven't a clue whether they're actually flying on Mesa, or GoJets, or what have you.

Anyhow, it seems that if the majors were to take back all the aircraft and flying, and simply tell pilots, "OK, if you want to hire on with us, you have to go fly turboprops and RJs for X number of years at a reduced pay scale. Then once you've done that, you can join the mainline crews at the mainline pay scale."

Such a move would not affect existing pilots at the majors, because all the current regional guys would be brought in below the most junior current pilot at a major. It would solve the regional pilot 'shortage' in a heartbeat. And just think of the cost savings to the majors, who now don't have to spend all this time bidding routes to any regional who will take it.

Such a move would also help regional pilots, because now they'd all have a guaranteed career progression. I bet that'd dramatically reduce attrition in the regionals. And it's not like the majors would have to demand further pay cuts; they could keep their costs flat, simply by bringing in the regional guys at their current pay rates.

t seems to me that if an airline can just do away with thousands of retiree pensions (UAL, for example...and AA is trying to do the same)...then such a move would be relatively easy for it to make.

I'm clearly missing something obvious. I just don't know what it is
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Old 04-24-2014, 01:11 PM
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Having regionals, lowers the market value for pilot labor. Instead of poaching off the other legacy carriers, regional pilots will work for anything better than what they currently have. Thus, pay at mainline is cut in half, and thousands of apps remain on file.
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Old 04-24-2014, 01:15 PM
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It's not only the pilot costs, there are many economic factors that make it cheaper for mainlines to outsource flying. Outsourced flying does not cost the mainline anything for MX, fuel, labor costs, aircraft costs, etc. Also there is less liability for the mainline carrier on the outsourced route. It sucks but thats business in the US today.
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Old 04-24-2014, 01:23 PM
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Originally Posted by Bzzt View Post
It's not only the pilot costs, there are many economic factors that make it cheaper for mainlines to outsource flying. Outsourced flying does not cost the mainline anything for MX, fuel, labor costs, aircraft costs, etc. Also there is less liability for the mainline carrier on the outsourced route. It sucks but thats business in the US today.
I thought (am I wrong?) that in many cases, the mainline takes care of fuel and MX, leaving the regionals to basically provide pilots and FAs.

As for liability...with the Colgan 3407 crash and that other bird that departed the wrong runway at dawn in Kentucky or somewhere, did the major carrier not get named in the resulting lawsuits? Or was it just Colgan?
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Old 04-24-2014, 01:28 PM
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There is a big difference in being named in a lawsuit vs found liable.
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Old 04-24-2014, 01:32 PM
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Ask Air Canada. They had CRJ200's. Lasted pretty long then dropped them in favor of the E175/E190. Then dropped the E175 to a cheaper regional.. Think the 190's are kind of the cut off point.. Its been tried before in the USA Midway airlines 737 and CRJ200's. USair has dabbled in it... Just not long term ideal for the Majors to invest millions of $$ in a 76 seat plane. I see a shift of majors spending money to "refleet" there widebodys..
Stability in it..
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Old 04-24-2014, 01:32 PM
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Originally Posted by Bzzt View Post
It's not only the pilot costs, there are many economic factors that make it cheaper for mainlines to outsource flying. Outsourced flying does not cost the mainline anything for MX, fuel, labor costs, aircraft costs, etc. Also there is less liability for the mainline carrier on the outsourced route. It sucks but thats business in the US today.
Mainline usually takes care of the fuel and if they own the planes they probably take care of Mx too. Regionals provide cheap labor.
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Old 04-24-2014, 01:37 PM
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Back when regionals were called commuters and flew metroliners and beech 1900s it made sense to outsource those routes. Somewhere along the way regionals got bigger but the model stayed the same. Now it's a bubble that's about to burst. Maybe it's time for majors to get the flying back.
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Old 04-24-2014, 01:41 PM
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Some mainlines pay for fuel, I'm not sure if they all do. Airlines like Skywest have their own MX so United isn't paying MX costs on those aircraft. Regionals are not only staffing agencies.
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Old 04-24-2014, 01:42 PM
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Originally Posted by minimwage4 View Post
Back when regionals were called commuters and flew metroliners and beech 1900s it made sense to outsource those routes. Somewhere along the way regionals got bigger but the model stayed the same. Now it's a bubble that's about to burst. Maybe it's time for majors to get the flying back.
There's nothing 'regional' about most of the routes we fly out west. SFO-AUS, IAH-ONT, LAX-MSP, DEN-YEG.

It still makes sense for the majors to outsource as much flying as they can. They just weren't allowed to because of scope at some point. Now that they've relaxed scope we get to fly those routes for $22/hour.
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