Mesa Bankruptcy could be 7/20

[XPOO]

...while I will certainly agree that Skywest has some excellent long term contracts, they will not come out unscathed when United and if Delta go bankrupt.

You mean, like the way SkyWest was dealt irreparable harm the last time both Majors were in bankruptcy? Or would you like to change your statement to this: SkyWest, Inc. will once again be instrumental in helping BOTH United and Delta get through bankruptcy should either have to file again.

 

[zawillif]

Back to the title of this thread. The court hearings between Mesa and Delta are supposed to end today. Any news yet on the verdict?

 

[rickair7777]

Comair is in an excellent position for growth. Along with Compass and Mesaba.

Obviously, a major airline would prefer to make cuts at contractors before a wholly-owned.

However...I think all of the contractually-permited cuts have ALREADY been made. If the choice is to pay a contractor to NOT fly, or make cuts at a wholly-owned, it's pretty easy to see what's going to happen.

Of course I would not want to be at a contractor whose contract happens to expire in the immediate furure...that's what you call Wrong Place, Wrong Time.

 

[rickair7777]

I like Skywest. I wish I would have gone there 6 years ago. But I don't think I'd base my long term airline career on their (or any lift providers) enduring prospects.

UAL sucks...HOWEVER, pax don't seem to care if you suck or not, and customer satisfaction is not the name of the game right now...

The key to survival is financial endurance...

As it turns out UAL and DAL are better positioned in this regard than some other airlines. Airways and AMR are in the hurt-locker, and bringing up the rear in dead-last finanial position it looks like, you guessed it! Mesa Air Group :laugh:

Take a read, this article's rankings are based on finances (not operations) which appears to be the name of the game right now. And skywest is doing fine, thanks, second only to SWA...

http://news.morningstar.com/articlenet/article.aspx?id=237841

 

[USCtrojan]

Yes and no. While I'm not conversant on the route structure of ASA, I suspect a fair (just fair, not majority) of it is to smaller cities using 50-70 seat RJ's.

With oil prices the way they are, airlines are looking to reduce frequency or eliminate entirely to smaller cities. A significant amount of traffic from smaller cities has traditionally been sold at a loss anyway, and the revenue has been made up when they get to the hub.

That sort of thinking will probably go away if oil continues to rise. At some point, a city will either get one/two flights a day from a large jet, or just be cut out of the route structure entirely.

Remember, in the days of "regulation", there hundreds of small cities that never had air service. Now that gas is expensive, and will continue to go up over the long haul, airlines will probably shrink to service their core markets.

Who knows though? I hope it's just another cycle. You're right about Europe. Ryanair makes huge profits . . . . with a fleet of 737's though, not contracted lift feeding the hubs though.

In order to fill those big planes, you have to have lift from other (smaller) planes. Putting a large aircraft that consistently fills itself @ 50-60% full is dumb if you can fill smaller (lift providers) near 100%. Yields go up as the capacity is less. Core markets? What does that mean? You mean Dothan, Valdosta, Augusta, Tallahassee will go away? I seriously doubt it. Yields for these markets are very high and will not benefit by fill an md88 at 40% full. Lift is lift. I agree, some markets will shrink capacity or go away, but a lot of those "feeder" routes fill your 767's going from ATL-LAX/ATL-CDG etc.

Oil is down over $4 as I write here. Our Economy will come back. Markets are cyclical, it ain't gonna sustain like this (and I dare say for not much longer). Unfortunately, Airlines tend to be the tail of our economy. If oil comes down, however, I think you may see a relatively quick recovery and a resuming of service in the not-so-stellar markets.

Trojan

 

[Soverytired]

You mean, like the way SkyWest was dealt irreparable harm the last time both Majors were in bankruptcy? Or would you like to change your statement to this: SkyWest, Inc. will once again be instrumental in helping BOTH United and Delta get through bankruptcy should either have to file again.

A not unlikely scenario. Skywest is a tightly run ship.

Understand: It is not my desire to see any regional lift, or any airline, go under.

I do believe the fundamentals for this business are changing radically, and a large part of this will mean fewer RJ's and fewer cities serviced.

Seems hard to believe that this could happen. However, PIT is a good example. PIT is hardly a small town, and as little as 9 years ago it was a booming hub. Now it's a ghost town. When LCC shut it down, no one moved in to pick up the pieces.

The same is probably going to happen to numerous other small cities over the next 2-5 years. This can only mean fewer jobs for lift providers (and airlines).

UNLESS . . . . Lift providers become actual airlines again. Skywest did a great job selling tickets as an actual code share partner in the past. I could see them doing this again in the not too distant future.