I believe that ExpressJet, as a restructured entity, could be viable as a 100% pro-rate carrier. The reason that most 50 seat contracts are now loss making is that the majors believe that they are doing the regional carriers a favor by extending their contracts so that they do not have any tail risks or overstaffing. However, today's pilot crunch is going to break this model. There is a possibility that a profitable 50 seat contract may never be signed again.

By flying pro-rate, ExpressJet would be able to share directly in the success of failure of the route. They would also be able to choose where they fly. Without it, the chance that ExpressJet would be profitable by 2015 is almost zero.

 

Its not going to happen, too much risk.

All of Colgan SAAB flying was pro-rate. It was a perennial money-losing operation. What makes you think they could make it work?

 

Sell to whom though? They already are owned by the best regional holding company in slywest and united or delta won't buy them unless they file chapter 11 first and come out only flying for united or delta. That is exactly what happened to pinnacle. We had a good contract that we fought hard to get. Delta and united said no and delta took us and transformed us into endeavor for their future needs. United is the only legacy without a "go to regional" for the future so maybe the same thing happens to express jet. Either way good luck

 

Will not happen.. Delta will not buy us back due to integration with XJT side. Plus, we left sour taste in their mouth with spikey hair, backpack toting generation. Also, too expensive of risk for other regionals to buy. Next..

 

The only reason Skywest bought ExpressJet was to control market share under a merged United. XJ will be downsized before they are sold.

 

Your premise, like your grammar, is flawed.

 

Doubt SkyWest would want to put yet another competitor out there.... If anything i see a merger of all 3.. But it won't happen for 5+ years after xjt is 1/3 the size... ( just my take...)

 

I'd say more like 1/16 the size. Even then, it's a slim chance.

 

THIS ^^^^. Actually it was to gain a toehold with Continental and keep Republic from conquering the world, and then the United merger went and screwed it all up. ExpressJet lost insane amounts of money trying to go it alone pro-rate the first time, why on Earth would it work now?? (Disagree? Then explain why the Delta LAX flying was being done at cost just to keep the airframes moving. If pro-rate was feasible across the board then ExpressJet could have painted the rest of their planes like the AquaFresh tubes and given Continental the middle finger.)

 

EV went independent the first time. In this case, I am suggesting at-risk flying under the DL and UA code. There is a huge difference. Skywest has around 70 planes flying this way today. If you pick the right markets, you can generate more money than what you would be paid under a CPA contract. OO just put four more planes in the pro-rate pool at ORD to pick up RP flying for AA.


Can you name any airlines that currently have a profitable 50 seat CPA contract besides Air Wisconsin?


Risk = yield. Isn't OO's EMB-120 flying profitable? In order to boost yields, regional airlines may have to accept more risk. After all, the majors bought regionals in the 1990s and early 2000s because they were making lots of money and they wanted in. Regional pro-rate flying can be profitable across the nation provided that those carriers adjust to the new financial realities of the flying. Although fuel was much cheaper in the past, that did not stop numerous airlines from going bankrupt.