JO Decides Code-Shares Are Better Than Flying Empty in HI

[islandhopper]

Unfortunately, it isn't JO who will feel all of the hostility from the people in Hawaii, it will be his employees.

what's a little felony assault charge if you had the chance to false Johnny O? Get a good attorney & i'm sure you could beat the rap, or just make moke and flee the scene!

 

[SpacemanSpiff]

speak for yourself...

Long time Mesa employees are (or should be) scared to death that some other carrier is going to underbid our contract flying with cheaper rates . . . that would destroy OUR status quo.

Speak for yourself and not ALL of the long time Mesa employees, please.

I am NOT worried about other carriers underbidding us. What worries me is that our codeshare partners are going to get smart and realize that by paying someone else a little, or maybe a lot, more they could get them a better product. And maybe a better regional product will pay dividends in the long run.

But, then again, is it possible for airline management types to thing REALLY long term?

 

[SpacemanSpiff]

things that make you go "hmmm?"

Why is he doing this if he's already planning on losing money.

This is what we all want to know. WHY? I know a lot of you folks don't like JO, and I understand why. However, if you think he is stupid you are mistaken. Capable of errors of judgement, absolutely...just like you and me. Letting his pride and ego get the best of him? Certainly possible.

Maybe I am being cynical, but to me it looks like a way to lose some money...not a lot, but just enough, so that when it comes contract negotiation time in 2007 he can say, "Look, we are losing money. We can't afford to pay what you want."

The guy is not an idiot and he definitely has reasons for doing this.

And to mdanno808 who pointed out that JO previously stated that he is going after the local market...one thing you quickly learn about JO is that he is very good at telling his audience exactly what THEY want to hear. He can be very persuasive.

 

[Soverytired]

Speak for yourself and not ALL of the long time Mesa employees, please.

I am NOT worried about other carriers underbidding us. What worries me is that our codeshare partners are going to get smart and realize that by paying someone else a little, or maybe a lot, more they could get them a better product.

Heh. Touche. Good point . . . but I really think the quality of service differences among regionals is pretty minor. Plus . . . with gas going outta sight for the foreseeable future, cheaper CRJ vendors = a heck o'alot'a sense.

Maybe I am being cynical, but to me it looks like a way to lose some money...not a lot, but just enough, so that when it comes contract negotiation time in 2007 he can say, "Look, we are losing money. We can't afford to pay what you want.

No, you're DEFINITELY are being cynical. JO's gonna burn 25+million at least on this Hawaii op . . . far more than any contract improvements we're likely to get. There is definitely more to the Hawaii op than meets the eye (my pet theory: narrow bodies at MAG), but I doubt it's just to spite the pilots 4 years from now.

 

[AerroMatt]

Application Fee? YGBSM!!!

I saw the Ad where Mesa is hiring 100 flight crew by the end of the month. Just for $h!ts Grins and Giggles, I went to the websight and then I read that linked article from Future Airline Pilots Mag. I kept reading it until I came to the statement that pilots "Must bring $50 cash or credit card to pay the application fee".

No wonder JO can afford doing a start up! Not only do they have some of the lowest wages (I'd never equal my current salary there) in the business, but you gotta pay them to accept your application!?!? C'mon you guys! This bottom feeder ain't worth it!

And I thought PFT was an insult...

 

[Soverytired]

I saw the Ad where Mesa is hiring 100 flight crew by the end of the month. Just for $h!ts Grins and Giggles, I went to the websight and then I read that linked article from Future Airline Pilots Mag. I kept reading it until I came to the statement that pilots "Must bring $50 cash or credit card to pay the application fee".

Uh, lots of airlines have a fee associated with applications. But Mesa uses "AirlineApps.com" (as does Continental, Frontier, Spirit, Go! (heh)), which I believe is free.

Helps keep the non-serious candidates from applying for the heck of it (and swamping the airline with applicants who have no intent of either interviewing or accepting a job offer)

First time you've ever applied for an airline job?

 

[j41driver]

Perhaps all of you genious' should become a study of your own industry.

Hint: all of those Caravan's and C-206's overthere did not come over on boat

True enough but JO didn't have anything to do with getting them there either.

 

[j41driver]

Never going to happen. Not without ferry tanks at least:

Assume that the flight is flown at FL340 and .70 mach. That equates to roughly 405 knots true airspeed assuming standard atmosphere. SFO-HNL is a distance of 2082NM direct. Add an extra 5% (105NM) for routing/vectors and you come up with 2187NM distance.

So 2187NM divided by 405knots = 5:24 block time, take off to touchdown. Add on an additional 5% to correct for the fact that you aren't going to average 405kts (lower due to climb and time at lower altitudes), and you come up with 5:40. Add an additional :45 minutes and you need just under 6:30 worth of fuel, and that doesn't account for taxi time, delays, less than perfect profiles, or headwinds enroute.

14518LBS is the absolute maximum useable fuel. If you consider that the odds of a perfect refueling, fuel gauge inaccuracies, tank malformations and other things that might affect the total load, I'd only want to count 14000 of that as actually onboard/useable (personally).

So 14000 of fuel, divided by a flying time of 5:40 means that you have to have an average burn of no more than 2470lbs/hour (without reserves or taxi). No CRJ that I know of will make that.

So sounds like ferry tanks, dismantle and ship, or a really long glide at the end!

But if you only run on one engine......

 

[j41driver]

I am NOT worried about other carriers underbidding us.

Well no sh1t you're not worried. Why would the perennial lowest bidders be worried about that?

What worries me is that our codeshare partners are going to get smart and realize that by paying someone else a little, or maybe a lot, more they could get them a better product. And maybe a better regional product will pay dividends in the long run.

I wouldn't worry about that either if I were you. UAL had a much better product with ACA and AWAC than they ever did/will with Mesa and you see how much they cared about that.

 

[j41driver]

I doubt it's just to spite the pilots 4 years from now.

4 years? 2007 is just 259 days away.

 

[DashCojones]

I wouldn't worry about that either if I were you. UAL had a much better product with ACA and AWAC than they ever did/will with Mesa and you see how much they cared about that.

...proof?

 

[Soverytired]

How long has UPS been w/o a contract? . . . .

4 years? 2007 is just 259 days away.

I seriously dobut contract talks are going to last a week once they begin. I think the timeline will be something like:

1 year - (g or t): Talks begin.

2 years - 3 years: Rhetoric ratchets up on both sides.

3-4 years: Strike authority sought, cooling off periods ensue, strike (? big "maybe" here, and I'm pretty ambvilent on this point), mediation, new contract.

 

[Soverytired]

Those in glass houses . . . .

I wouldn't worry about that either if I were you. UAL had a much better product with ACA and AWAC than they ever did/will with Mesa and you see how much they cared about that.

Meanwhile, AWAC had such a "superior product" that they only had to pay USAir $250 MILLION (or, 1/4 of a BILLION) dollars for the privledge of flying for them.

 

[j41driver]

...proof?

History. UAL dropped Mesa once for poor performance. The only reason they brought them back is because they would do the flying cheaper than the encumbent UEx carriers.

 

[AerroMatt]

Uh, lots of airlines have a fee associated with applications. But Mesa uses "AirlineApps.com" (as does Continental, Frontier, Spirit, Go! (heh)), which I believe is free.

Helps keep the non-serious candidates from applying for the heck of it (and swamping the airline with applicants who have no intent of either interviewing or accepting a job offer)

First time you've ever applied for an airline job?

No, and as a former airline Chief Pilot, I will never stoop that low. I'm very happy where I am now as a Part 91 Flight Dept Manager. Besides, Mesa pay scale couldn't even begin to close on my current salary.

If you would have read my post a little closer, you would see that I was quoting their HR interviewer re: $50 application fee. If you seriously want to pay to fly, this is defineately the way to go bottom feeders!

 

[Soverytired]

Looks like it's not 737's after all . . . .

See the attached article. Mesa is close to finalizing a deal for E-195's initially for the GO! operation. But anyone who's been following the trend of the regionals knows that this will also perfectly position Mesa for additional business with code-share partners in the US who might want a regional to fly this highly sought after aircraft.

JO might not be the best boss in the world, but he's f'ing brilliant.

http://www.flightglobal.com/Articles/2006/04/18/Navigation/177/205991/Mesa+close+to+finalising+E-195+fleet+deal+for+Go.html

Mesa Air Group chairman Jonathan Ornstein is close to finalising a deal that will introduce Embraer’s 195 to the operator’s fleet.
The 95-seat aircraft will be assigned to Mesa’s Hawaii start-up Go, which will be launched on 9 June with five or six Bombardier CRJ200s. Ornstein says the decision to deviate from the larger Bombardier regional jets now employed in Mesa’s fleet will give him more leverage with new and existing feeder contracts, as well as aid his Hawaii expansion.
“It will be good to have certification across all these aircraft types,” says Ornstein. “Our [Mesa Air Group] fleet will soon be running short as some 50-seater jet leases expire. Once I have [E-195] certification I will have a better opportunity to approach the [mainline] airlines with options to upgrade to larger aircraft.”
Go’s initial fleet will contain at least five and possibly as many as eight CRJ200s, says Ornstein. Of these aircraft, talks are “at a very late stage” for short-term leases on five or six ex-Independence Air Bombardier 50-seat jets held by Export Development Canada (EDC), a government agency.
EDC confirms Mesa is one of “a few” airlines in talks to lease about a dozen of the 27 Independence Air and 15 Northwest Airlines Bombardier regional jets currently owned by the Canadian government agency as part of a lease guarantee deal with Bombardier customers.
At the end of 2005 Mesa Air Group operated 92 50-seat regional jets (27 of which are Embraer ERJ-145LRs, the rest a mixture of CRJ100s and CRJ200s), 15 CRJ701ERs, and 39 CRJ900s as well Beechcraft and Bombardier turboprops

 

[cfdoubleeye]

HI A/C Ferry ops

Guys, I have no doubt that the aircraft can make the haul to Hawaii. Cessna 172's and our own Piper Turbo Seminole made it. The key is favorable winds (tailwinds blow about 300 days of the year.... called "tradewinds" in the islands.)

There are a handful of ferry operation companies who hold the proper certificates for the mod to install ferry tanks in ATR's, CRJ's, King Air's, Cirrus SR22's and even grandma's Cessna 172.

It's not a trip I would want to make, but even when the ferry pilots do go swimming, the fatality rate is extremely low.

 

[Junkflyer]

Yes there's a tailwind most of the time, but it helps going to the mainland not coming back.

 

[islandhopper]

See the attached article. Mesa is close to finalizing a deal for E-195's initially for the GO! operation. But anyone who's been following the trend of the regionals knows that this will also perfectly position Mesa for additional business with code-share partners in the US who might want a regional to fly this highly sought after aircraft.

JO might not be the best boss in the world, but he's f'ing brilliant.

The only way he will fly 195's in Hawaii is IF / after he gains significant market share. He is going to wait a long time to buy these airplanes from a Jet Blue 363 asset sale.


Pay full price for new airplanes? Not without a guarantee revenue setup in effect. His stock price is going down today after this announcement. Bragging that you will lose money for 5 years while re-fleeting with an unproven airplane doesnt sit well with wall street.

 

[Soverytired]

Actually, I think your avatar is pretty funny . . . !

The only way he will fly 195's in Hawaii is IF / after he gains significant market share. He is going to wait a long time to buy these airplanes from a Jet Blue 363 asset sale.


Pay full price for new airplanes? Not without a guarantee revenue setup in effect. His stock price is going down today after this announcement. Bragging that you will lose money for 5 years while re-fleeting with an unproven airplane doesnt sit well with wall street.

Why not buy new a/c? Jet Blue has slowed down delivery of this mx queen, so there are some discounts to be had. Plus, we're only talking a couple. Ultimately , I don't think this is so much about Hawaii/Go as it is about getting E170/190's on the property so Mesa can eventually fly them for a code-share in the states in the not-to-distant future.

It's pretty clear that one reason CHQ got the COEX flying because they can fly E175's via the Republic certificate . . . and they'll fly them for United as well. Mesa needs to position itself to get on this gravy train, because the 50-seat market is drying up fast.

The whole point of the "Go!" startup is to get away from guarnteed revenue contract flying. The whole fee-for-departure model seems to cause alot of agnst amongst alot of flightinfo fans, but when Mesa finally tries to actually be a REAL AIRLINE, now they're the bad guy. I'm not aware of any other big regional player that's even attempting it right now, so it's a pretty gutsy move.

(and yah, it sucks for Hawaii/Aloha to have a new competitor, but we ain't in the worker's paradise yet, comrade )

Mesa stock has been a pump-and-dump for the last decade(Buy at $5, sell at $12-$15, repeat.) I wouldn't read alot into this.

 

[dash8driver]

its not the fact of having a new competitor that has people upset. no one got upset when WP became its own airline recently. the difference is the scorched earth style that JO is coming to the island with.



.

 

[islandhopper]

its not the fact of having a new competitor that has people upset. no one got upset when WP became its own airline recently. the difference is the scorched earth style that JO is coming to the island with.





.

here here. Nobody is running off calling Alaska or Southwest evil pillagers because they want to come to Hawaii either.

 

[Soverytired]

Wait, I'm confused . . .

here here. Nobody is running off calling Alaska or Southwest evil pillagers because they want to come to Hawaii either.

Alaska and Southwest are doing inter-island flights in Hawaii?

Funny, I thought they were doing direct flights from the mainland only. I thought the inter-island take was what was driving a few Aloha/Hawaii guys nuts.

And in all seriousness . . . what "scorched earth" policy? You mean cheap tickets? Nobody objected to Indy Air when they took that path (though it fed their own destruction and rapid demise . . .)

 

[dash8driver]

yes, you were confused. the point is that competition is not a problem, where its happening doesnt matter either.

if you think i meant cheap tickets, you either are trying to be cute or you have your head burried and havent been reading any of his press releases. making statements like "we can fly empty planes for 5 years...", etc is pretty clear that his main mission is to cause maximum damage to the other players, not to provide air service as a business.

if you were playing pool at the bar... you typically have to compete to stay on the table. if someone comes in and asserts their position with a bat or a gun, are you going to look at them the same way you do the other patrons?


.

Alaska and Southwest are doing inter-island flights in Hawaii?

Funny, I thought they were doing direct flights from the mainland only. I thought the inter-island take was what was driving a few Aloha/Hawaii guys nuts.

And in all seriousness . . . what "scorched earth" policy? You mean cheap tickets? Nobody objected to Indy Air when they took that path (though it fed their own destruction and rapid demise . . .)

 

[dash8driver]

.......

 

[Soverytired]

Trust me, no one as EVER accused me of being "cute" . . . .

yes, you were confused. the point is that competition is not a problem, where its happening doesnt matter either.

if you think i meant cheap tickets, you either are trying to be cute or you have your head burried and havent been reading any of his press releases. making statements like "we can fly empty planes for 5 years...", etc is pretty clear that his main mission is to cause maximum damage to the other players, not to provide air service as a business.

.

I don't really think JO's plan is to lose money for 5 years. I really think that sort of talk is to convince Mesa's insitutional investors that this operation represents a very small portion of Mesa's business, and will at worst lose only a small amount of MAG's overall cash.

Nor do I think he's interested in undercutting Aloha or Hawaiian just for spite . . .and spite it would be, because I think it's highly unlikely that he'll be able to bleed either carrier back into BK with a few beat-up, broken down, APU working "one-day-in-11" CRJs.

If I were a Hawaiian/Aloha pilot, I'd relax and just ignore the whole thing. Remember, JetBlue started with 150 million, a fantastic mangement team, brand new aircraft, and low cost employees. 5 years later, it's an open question as to whether or not they'll be around in another 5. This is MESA . . . we're talking about, not JetBlue.

If you're a tenth as good as you think you are, you'll clean Mesa's clock. If you're in reality just a local monopoly gouging local traffic, well . . . then it might get interesting. Personally, I suspect the truth is somewhere in the middle . . . and you'll pull out ahead in short order (1-2 years, max).

 

[dash8driver]

but no one has seen you in your jammies with the airplanes on em...

that very well could be.. but those kinds of statements are provoking the attitudes that are emerging. we will have to see.

most of us are relaxed. i for one am.. since the industry has been circling the drain, i have been busy working on plan's b, c and d...

it would be foolish is say "its just mesa" and question whether they'll be around in 5 years. JO's accused only of being an a$$hole.. not of being stupid. besides... herpes is still around and we've not found a cure for that yet...

I don't really think JO's plan is to lose money for 5 years. I really think that sort of talk is to convince Mesa's insitutional investors that this operation represents a very small portion of Mesa's business, and will at worst lose only a small amount of MAG's overall cash.

Nor do I think he's interested in undercutting Aloha or Hawaiian just for spite . . .and spite it would be, because I think it's highly unlikely that he'll be able to bleed either carrier back into BK with a few beat-up, broken down, APU working "one-day-in-11" CRJs.

If I were a Hawaiian/Aloha pilot, I'd relax and just ignore the whole thing. Remember, JetBlue started with 150 million, a fantastic mangement team, brand new aircraft, and low cost employees. 5 years later, it's an open question as to whether or not they'll be around in another 5. This is MESA . . . we're talking about, not JetBlue.

If you're a tenth as good as you think you are, you'll clean Mesa's clock. If you're in reality just a local monopoly gouging local traffic, well . . . then it might get interesting. Personally, I suspect the truth is somewhere in the middle . . . and you'll pull out ahead in short order (1-2 years, max).

 

[RJP]

Nor do I think he's interested in undercutting Aloha or Hawaiian just for spite

So you don't believe that he is pissed at AQ for not letting him buy them when they were seeking investors? That's the story here on the ramp. Suddenly, JO decides that he can offer a 'better product' to the islands after all these years? He's had a look at the books at both AQ and HA and he knows how to hurt them if he really wants. Hence the whole, "I can fly empty airplanes for five years" rhetoric.

Sadly, I think you're confused again.

 

[jetdriven]

But if you only run on one engine......

a lot of our -200's wont make .70 with both engines running. And most of them wont climb above FL320. thats what 27,000 airframe and engine hours gets you.

 

[Soverytired]

I believe the psychological term is "projection" . . . .

JO's low-balled offers before and lost those bids. That's just business. Win some/lose some.

Let me tell you another "story on the ramp" . . . here on the mainland, I've talked to more than a few pilots who are convinced that JO wants to "lose money", so when our contract comes up for amendment in a year, he'll be able to avoid marginal improvements because "we're unprofitable."

That's CRAZY TALK! I mean, set a course to lose 50-100 milliion over the next 2-4 years (much more if you count all the potential business that will go elsewhere over that time if we're perceived as a sinking ship) just to avoid some incremental (and CHEAP) QOL improvements?

Puh-lease. JO has something up his sleeve (I hope). Everyone on the local level is looking at "Go" through their local-issues prism, but only one man has the "big picture.", and really knows what the real reasons are. . . .

So you don't believe that he is pissed at AQ for not letting him buy them when they were seeking investors? That's the story here on the ramp. Suddenly, JO decides that he can offer a 'better product' to the islands after all these years? He's had a look at the books at both AQ and HA and he knows how to hurt them if he really wants. Hence the whole, "I can fly empty airplanes for five years" rhetoric.

Sadly, I think you're confused again.