Major intentions for regionals

[wms]

I posted this on another thread, but maybe it needs a thread of its own.

Since the majors have been making lots of money and have been sharing the wealth with employees, expanding ammenities and paying vendors more, it seems strange they haven't shared the wealth with the regionals but are continuing the downward pressure on them. I wonder why?

Maybe to expedite the thinning of the herd, or drive value of the regionals down to buy them cheap later, or an attritional way to get rid of 50-seaters. Nonetheless, the regionals that survive will have pricing power eventually, but not very soon unless failures happen quickly.

 

[king10pin02]

Why would they care about the regionals or simply pay them more? Would a grocery store pay its coke vendor more simply because it had a good year? Of course not, no business would voluntarily increase its own cost.

 

[asayankee]

They would if the coke distributor wasn't able to reliably deliver product to the grocer. I specifically avoid shopping at Kroger because they don't always have some of the products I like.

 

[General Lee]

Luckily there will be 15,000 job openings over the next decade at the 3 legacies. I understand not everyone wants to move on to a legacy, and if that is the case, you would have to realize what us happening in the Regional industry. More than half of your planes, the 50 seaters, do not make money. That is problematic. And, when there are profits (thanks to Consolidation and bag and change fees) there are fewer scope concessions by mainline groups. So, the Regional side is shrinking, and lower wages there haven't produced any replacement pilots either. Not a good sign.

My advice again, apply to the Legacies first, and then LCCs if you don't have PIC time. Get away from the shrinking side of the industry. That might mean starting over, but better contracts at the legacies mean regaining current pay and better faster.



Bye Bye---General Lee

 

[Jetjockey]

It is just part of the reality of being the worker for a lower cost, outsource provider.

 

[Mercyful Fate]

Luckily there will be 15,000 job openings over the next decade at the 3 legacies. I understand not everyone wants to move on to a legacy, and if that is the case, you would have to realize what us happening in the Regional industry. More than half of your planes, the 50 seaters, do not make money. That is problematic. And, when there are profits (thanks to Consolidation and bag and change fees) there are fewer scope concessions by mainline groups. So, the Regional side is shrinking, and lower wages there haven't produced any replacement pilots either. Not a good sign.

My advice again, apply to the Legacies first, and then LCCs if you don't have PIC time. Get away from the shrinking side of the industry. That might mean starting over, but better contracts at the legacies mean regaining current pay and better faster.



Bye Bye---General Lee

Holy sh*t, you are a broken record!!!

 

[chqflyer]

I posted this on another thread, but maybe it needs a thread of its own.



Since the majors have been making lots of money and have been sharing the wealth with employees, expanding ammenities and paying vendors more, it seems strange they haven't shared the wealth with the regionals but are continuing the downward pressure on them. I wonder why?



Maybe to expedite the thinning of the herd, or drive value of the regionals down to buy them cheap later, or an attritional way to get rid of 50-seaters. Nonetheless, the regionals that survive will have pricing power eventually, but not very soon unless failures happen quickly.

They are under no obligation whatsoever to do so.

 

[chqflyer]

Holy sh*t, you are a broken record!!!

Maybe so, but I believe this post to be accurate. The regionals are gonna shrink. It's an absolute certainty. Anyone with the with the chance to move onto a major really should do so without a second thought. The folks choosing to gamble and stay at the regionals are most likely going to be in for a world of hurt as planes go to the desert and lifers get downgraded back to the right seat.

 

[wms]

They are under no obligation whatsoever to do so.

I understand that. I'm just wondering what ml's intentions for the regionals are. Eventually there will be fewer regionals, just like pilots and either cpas will increase in value or ml will absorb them.

I'm not planning to stay here, but as someone who is interested in how business works, am just wondering how the industry will evolve as supply and demand change.

 

[Mickey Mouse]

I posted this on another thread, but maybe it needs a thread of its own.

Since the majors have been making lots of money and have been sharing the wealth with employees, expanding ammenities and paying vendors more, it seems strange they haven't shared the wealth with the regionals but are continuing the downward pressure on them. I wonder why?

Maybe to expedite the thinning of the herd, or drive value of the regionals down to buy them cheap later, or an attritional way to get rid of 50-seaters. Nonetheless, the regionals that survive will have pricing power eventually, but not very soon unless failures happen quickly.

It's a fair question. I suspect it's the same reason that we buy virtually everything from China. It's cheaper. We don't think about the 11 year old children working in a town 70 miles from Beijing, making sneakers, watches, purses, furniture, pot and pans, carpet, clothing, car parts, tools, washing machines, and etc. They work 14 hour days and live in housing on the factory property. The workers have no voice. They have no power. We are slightly different; we have the power of our vote and our solidarity. It is real, and it was recently exercised. We just gotta keep gettin' in their faces. Gettin' real close, right up in their Goddamn faces.

 

[General Lee]

Maybe so, but I believe this post to be accurate. The regionals are gonna shrink. It's an absolute certainty. Anyone with the with the chance to move onto a major really should do so without a second thought. The folks choosing to gamble and stay at the regionals are most likely going to be in for a world of hurt as planes go to the desert and lifers get downgraded back to the right seat.

Seeing what will happen, backing it up with facts may be a broken record, but that doesn't mean it won't happen. I am trying to give advice to people on here, throw apps out to legacies and LCCs in the beginning of a hiring wave instead of at the end. SKW lifers like Jon Rivoli and Mercy don't want to leave what they have now, but their airline very well may shrink around them, and then Mercy will end up an FO to Jon on the only remaining plane, an old Navajo flying to SGU from SLC.....


Prepare now folks.



Bye Bye---General Lee

 

[Holy Shiite]

Are you guys having fun talking to yourselves?

 

[General Lee]

Are you guys having fun talking to yourselves?

Still adding zilch to any topic or thread. Well done!


Bye Bye---General Lee

 

[Kaman]

Simple...It's my rice bowl, and I like mine full...basic human nature to be selfish.

 

[General Lee]

Simple...It's my rice bowl, and I like mine full...basic human nature to be selfish.

It's also basic economics. 50 seaters do not work with high oil prices. Then throw in new fatigue and hiring rules, plus 15,000 future openings at 3 legacies. The regional industry is going to change.


Bye Bye---General Lee

 

[Kaman]

I'd say the whole industry is going to go through an evolution similar to the maritime industry did beginning after the end of WW2. The US isn't the monopoly stakeholder in aerospace since the Cold War ended and the defense industry collapsed. We are slowly, steadily going to price ourselves out of a job to the point that this career is no longer appealing to anyone, but offshore workers flying airplanes primarily built in another country. The foundation of this has already been laid with NAI...Glad I am getting out through retirement before it's out of hand.

 

[General Lee]

I'd say the whole industry is going to go through an evolution similar to the maritime industry did beginning after the end of WW2. The US isn't the monopoly stakeholder in aerospace since the Cold War ended and the defense industry collapsed. We are slowly, steadily going to price ourselves out of a job to the point that this career is no longer appealing to anyone, but offshore workers flying airplanes primarily built in another country. The foundation of this has already been laid with NAI...Glad I am getting out through retirement before it's out of hand.

I don't see that at all. Consolidation has created 3 power houses, and bag and change fees have given the chance for sustained profits and stability. The pay and benefits will increase for those airlines, keeping the bar up for years.

Huge retirements will bring in new, cheaper pilots due to longevity, not worse contracts. There are 15+ year 75/76 FOs at the legacies because of stagnation over the last decade due to the Age 65 increase. As pilots retire, newer pilots will move back into the widebodies sooner, and Captains back in the 5-7 year range, which is impressive for the legacies after a decade of stagnation.

Those big profits will also help the big 3 defend flying here in the States, and the emergence of the ME Gulf 3 airlines is troublesome for European and SE Asian airlines, but the US airlines have the geographic advantage over the ME carriers. US pax will not fly to the ME first and then onto Europe or Asia, just so they can save a few bucks. Way too far.

I think the next decade will be great for the big 3 US carriers, somewhat for the US LCCs if they don't lose too many pilots to the big 3, and it may prove very tough for the Regionals. There is a Worldwide pilot shortage too, which means overall good things for pay and benefits as a whole for the profession.



Bye Bye---General Lee

 

[Freebrd]

It's also basic economics. 50 seaters do not work with high oil prices. Then throw in new fatigue and hiring rules, plus 15,000 future openings at 3 legacies. The regional industry is going to change.


Bye Bye---General Lee

Wow Jenny must be a rocket scientist! Or master of the obvious. Or....

 

[jetstream]

Just give them what they pay for. If the mainline carriers are not willing to pay their regionals enough that they can, in turn, provide a quality product then they simply won't get a quality product.

 

[chqflyer]

Just give them what they pay for. If the mainline carriers are not willing to pay their regionals enough that they can, in turn, provide a quality product then they simply won't get a quality product.

That's kinda circular reasoning there. I can't speak for all regionals, but it am quite ashamed by the "service" offered by my company. The only reason we're even around is because we're the absolute dirt cheapest out there. It's sad that no one seems to give a ******************** about the quality of a product anymore. It's all about being the absolute cheapest possible.

 

[wms]

Ditto, our operation now revolves around operational and maintenance convenience rather than performance and customer service, thus costing us millions in penalties and lost incentives.

 

[248to2.8]

Just give them what they pay for. If the mainline carriers are not willing to pay their regionals enough that they can, in turn, provide a quality product then they simply won't get a quality product.

The problem with that reasoning, is not all the regional carrier pilots are willing to push for that. Look at PSA. They took concessions to get more planes. When you have a pilot group willing to stab their industry brothers and sisters in the back, as well as lower their own pay and standard of living, then they will get all the flying from the mainlines when the rest of us stand up for better working conditions and pay. Plain and simple.

 

[jetstream]

When mainline starts getting enough customer complaints about poor service, missed connections, cancelled flights, and customers leaving they will do something about it.

My job is to move the aircraft and passengers safely from point A to point B. Period.

Plane's broke? Guess you better fix it. Short on crews? Guess you better find more. You signed and unprofitable CPA? Make sure you don't do it again. Etc.

 

[ex j-41]

It's also basic economics. 50 seaters do not work with high oil prices. Then throw in new fatigue and hiring rules, plus 15,000 future openings at 3 legacies. The regional industry is going to change.


Bye Bye---General Lee

Cheaper having 50 people on a 50 seater jet than 50 on a 70.

 

[IBNAV8R]

Cheaper having 50 people on a 50 seater jet than 50 on a 70.

50 people on a 70-seater is probably going to make money. Not the case for 70 people on a 140-seater.

There will always be a market for smaller planes and, until majors can operate them as efficiently as regionals, there will be CPAs and regional airlines. That is, until regionals can no longer staff airplanes.

It's the money, stupid!!

 

[General Lee]

Cheaper having 50 people on a 50 seater jet than 50 on a 70.

Bag fees and premium seats make more money for mainline. 50 seaters can't pay for their own gas.


Bye Bye---General Lee

 

[BuzzSaw]

Plane's broke? Guess you better fix it. Short on crews? Guess you better find more. You signed and unprofitable CPA? Make sure you don't do it again. Etc.

Plane's broke? Guess you better fix it. Pay me
Short on crews? Guess you better find more. Pay me
You signed and unprofitable CPA? Pay me
Make sure you don't do it again. Pay me

 

[AntiJedi]

50 seaters can't pay for their own gas.

They're machines, so of course they can't, silly willy! :laugh:

Seriously, though, a profit can and does get made on many markets, so it's entirely possible for a 50-seater to earn its own gas. I'm not talking about EAS, either. Unfortunately, at-risk flying revenue is a very small part of the overall operation, so it's hardly noticeable, but if you ask SKYW, Inc., these particular non-EAS routes must be at minimum breaking even, or even have a good profit to keep them around as long as they have.

 

[PBRstreetgang]

Bag fees and premium seats make more money for mainline. 50 seaters can't pay for their own gas.


Bye Bye---General Lee

As usual, dumb as dumb can be. Your "own" company put out a white paper explaining regional feed about 10 years ago. Regionals feed widebody (not your moms) planes, bringing pax from long thin regions(LBB) and keep widebody load factors up. Regionals were never intended to be stand alone operations, they morphed into what they are today, wage busting, money machines(for major airlines). So keep on playing your broken record, and don't let the facts get in the way.
Regional pilots were shoved under the lav truck wheels by prior mainline pilots and are pimped by the current mainline pilots.
So go ahead and have another sundae whipped up by your lead stew(mom), fat boy.....

 

[General Lee]

As usual, dumb as dumb can be. Your "own" company put out a white paper explaining regional feed about 10 years ago. Regionals feed widebody (not your moms) planes, bringing pax from long thin regions(LBB) and keep widebody load factors up. Regionals were never intended to be stand alone operations, they morphed into what they are today, wage busting, money machines(for major airlines). So keep on playing your broken record, and don't let the facts get in the way.
Regional pilots were shoved under the lav truck wheels by prior mainline pilots and are pimped by the current mainline pilots.
So go ahead and have another sundae whipped up by your lead stew(mom), fat boy.....

Hi PBR, wrong again. Things have changed in 10 years. First, consolidation has gotten rid of competitors, allowing bigger profits and more stability. Bag fees and change fees have "taken off" only in the last few years, something that wasn't around when you guys ruled the skies after the legacy BKs. Now the legacies are back in charge, and they have bought a lot of their own RJs, and award new contracts based on lowest cost.

Next, mainlines are getting smaller planes to cover and recapture previous mainline routes given to the Regionals. Mainline pilot groups aren't giving as much scope relief due to higher profits, and the airlines can now see that remaining larger RJs (70/76 seats) can cover outgoing 50 seaters that can't make money due to high oil. Then the smaller new mainline planes (DL 717s and AA 319s) swoop in and recapture routes that were given to you guys. Overall, more 50s will be parked than incoming 76 seaters will be added, meaning Regional shrinking, and mainline growth. Look at DTW to TVC (Traverse City, MI) this Summer. 4 daily mainline 717s and one RJ, vs last year 5 RJs and one overnighting mainline. Same type of examples at AA with new A319s.

Plus, add huge retirements coming and a mass exodus fleeing the Regionals toward the 15,000 job openings at the big 3 alone, and your side of the industry is in trouble, not to mention new hiring rules and fatigue rules, plus fewer commercial pilot license applications. Where will your airline get newhires this year, next, and the years after that? Very few can afford now a Riddle education, and the Military isn't producing as many pilots (lots of drone drivers).


PBR, what will you do? You obviously see things are changing. Maybe you and Jon Ravioli will be the last two there? You never know, and further consolidation may happen at your airline too, but the last one got you two airlines with mostly 50 seaters that will get parked sooner than later. Still, migrating pilots upward and away from your airline will continue to add huge pressure to the bottom line. DL will lose 800 pilots per year (2020-2023) for 4 years, and then over 600 in 2024. That's 4000 in 5 years. That will be expensive too, but DL can use the fees to pay for it, whereas your airline doesn't get any of the bag or change fees, rather a flat fee for departure for most, and a few at risk flights. Still, migrating pilots will really hit the bottom line, and if I were you, I'd look for other options, unless you can't for some reason...


Bye Bye---General Lee