The reason for AAG shifting the flying around is to shake the labor-tree so the apples on top fall down. You get people who have been staying put for a few years jumping ship because they think they got a great deal (quick upgrade, new planes, CQFO whatever), but the real winner is AAG. Cheaper labor force, same flying covered. It's almost comical how bad the regional industry sucks.

 

You're right It's the nature of the beast. 8 years ago when Republic bought MidAtlantic we had people leaving Piedmont like crazy to go to RAH for the quick upgrade and new planes. We had no growth (and actually our airline went from about 110 planes to about 40 when you combine us and ALG) so people left to go fly the 175 for less money because it was a chance for a faster upgrade. At the time I didn't blame anyone for leaving. Some of our pilots said hell no to going to fly the 175 for less money with a worse contract and terrible benefits. Up until last year they all thought they'd made a bad choice for staying at Piedmont. Those same people that stayed 7 years as FO's are now Captains and if they chose will flow over to American probably at the end of 2016. They are getting rewarded now for sure.
I've seen how the contract carriers have low balled the WO'ed carriers in the past to gain flying. It's a never ending cycle.
Looks now like the flying has become watered down that AAG looks it might be cost effective to keep most of it's flying in house.
Sure Republic won't get shut down and of course AAG can't cover all that flying at once. The writing however might be on the wall that RAH will shrink and ENVOY, PDT and PSA will slowly continue to grow. Parker in his own words said he wanted 3 WO'ed carriers each operating close to 150 aircraft with maybe 1 or 2 contract carriers.
The question is will the carrot be nice enough to get people to come to the WO'ed carries. Right now the answer is yes because many people see the quick upgrade and a job at American as a nice option. But how long will it last??? For RAH when they started people ran there for the same thing and it lasted a good 6 years. Maybe this is the WO's 6 year window and then like you said, "the tree will be shaken again."

 

Well of course... do you think that the shareholders would have bought off on the BK if AMR was like "Hey we are still printing money, but we want to get out of some leases on Fokker 100s so we are gonna declare BK."

It is true that eventually they would have gotten into trouble... I'm not saying they were all good. But its not like they were days or even months away from running out of cash. They needed to get out of Fokker and Maddog leases.

 

To declare BK has gotten harder for companies. RP has clearly stated the new pilot requirement rules and FAR 117 is a factor. But they had at least two years to prepare for it. As for ongoing labor negotiations? Isn't 8 years enough? (RLA sucks)
It's called supply and demand. When there is a glut of a product with low demands or just an over abundant supply, costs are cheaper. When the supply dries up or shrinks and the demand goes higher, (such as gas an oil) then the costs go up.
Times have changed and if regional carriers do not adjust to the change of climate, then they just won't last.

 

Right on^^*^**
Hey Bedford, this isn't BizEx. Raise your rates to a good wage or let mainline take the flying back if the margins are that small.
You continue to prove that you are only good at one thing, lining your pockets while hiding behind religion. You make me nauseous.
You must negotiate some crappy contracts with thin margins. Fail, just like your deal with trying to run Frontier. Fail.

 

Can't argue with you there since I don't know anything about the sim situation, but I don't think that would be the catalyst for getting the majors to bail republic out. The majors have the money to build sims or send pilots overseas for training. I would put it out there that they might go that route first. If they own the planes, then why not the sims?

 

Anything is possible, but it all takes time - whether it's to hire and train pilots or build simulators. There could be any number of ultimate outcomes to this, but short of a rather drastic cut in capacity (and hence feed), nothing is likely to happen immediately (or even quickly).