What's stopping Skywest inc from opening an alter ego to fly large RJs for Alaska?

Delta’s scope language is.....

It might be possible. Any alter ego would probably have to be completely separate. Separate employee group. Separate 121 certificate. And, then you risk upsetting your customers by skirting their agreement.

You'd certainly upset your labor, but I don't think American/Delta/United management would care at all. We have historical precedent set by TSA/GoJet and Chautauqua/Shuttle/Republic.

Nothing in theory.

But in reality it would likely poison the relationship with DL/UA/AA. SGU knows which side of their bread is buttered.

Also this is not a good time to start up regional/ULCC airlines. There's a pilot shortage at levels below legacy/big-6, but the FAA will require experienced 121 PICs at a startup, so any pilots who would be willing to do it for startup/regional wages would be badly substandard, or would very quickly unionize and demand what they're worth. The juice would not be worth the squeeze. Maybe someday, but not right now.

Delta is SkyWests biggest agreement. They would not upset DL just to fly a handful of over 76 seat aircraft for AS...

I agree, which again wouldn't stop Horizon. But we are slightly off track. The original issue wasn't one of scope, it was about the trend for regionals to fly larger jets, allowing in Skywest's case (and others) for more passenger miles from fewer block hours. It begs the question whether this is coincidental or driven by the dearth of highly qualified regional applicants, since a 76 seat aircraft requires the same number of pilots as a 50 seat aircraft.

Certainly, some markets might be more economically served - at least from a fuel standpoint - by 50 seat jets - but just as clearly these aircraft appear to be being increasingly replaced by the larger aircraft, be they Embraer/Maybe-soon-Boeing or Bombardier/Airbus.

At least to the extent that current scope limitations allow.

Up-gauging to alleviate a pilot shortage might not be limited just to the regionals.

The only downside is pax lose frequency options, which will put you at a competitive disadvantage if someone else will provide that frequency.

There are a couple of things at play:

DL scope has some trigger points that is actually shifting towards larger regional aircraft on average. Total RJs go down but the mix shifts towards dual class at the expense of 50 seaters. So the result is a higher average seat count per aircraft.

AA has a scope language that defines large RJ as larger than 65 seats. I predict that you will see a lot of 50 seaters being replaces by 65 seaters. This will also increase the average seat count per RJ.

SKYW INC is taking or shifting all dual class to the airline side while reducing 50 seaters on the XJT side. So the result is fewer overall block hours at INC level. Probably less ASM at INC level but all growth with OO.