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Oh NO! There could be an RJ surplus!

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General Lee

Well-known member
Joined
Aug 24, 2002
Posts
20,442
Airline bankruptcies could create regional jet surplus

The market for 50-seat regional jets could soon become saturated if Independence Air files for bankruptcy and liquidates its assets, an aviation analyst said. Northwest Airlines is expected to return some regional jets to lessors, and Delta Air Lines is expected to scale back operations of its Comair regional unit.

With Northwest Airlines set to return 15 CRJs to lessors and Delta Air Lines expected to downsize its wholly owned Regional subsidiary Comair, eyes are focused on Independence Air, which could saturate the market for 50-seat regional jets if it enters bankruptcy and liquidates as some analysts expect. The financially struggling carrier already has cut its fleet from more than 80 CRJ200s to 57, with more reductions likely to follow. "Once Independence files [for bankruptcy], there will probably be a very short time before they liquidate," said Gueric Dechavanne, an analyst with Back Aviation, who spoke at the Valuation Conference and Regional Airline Seminar sponsored by Commercial Aviation Media and Everest Events this week in Alexandria, Va. "Lease rates will depend on the quantity of aircraft hitting the market. RJ leases may be restructured." There currently are 2,000 50-seat RJs in service, he said, with only about 4% parked. Recently, Republic Airways signed sublease agreements with a Mexican carrier to take three of its ERJ-145s, said VP-Marketing Planning and Scheduling Jeffrey Jones. The aircraft have been removed from Republic's operating certificate and more could follow, said a company spokesperson. Republic operates 100 ERJ-135s/-145s and will have 45 Embraer 170s in service by year end. Earlier this month, wholly owned Air France subsidiary Regional converted an order for seven ERJ-145s to six Embraer 190s. Stacey Wilson, an analyst with CIT, argued, "There are places outside the US where 50-seaters can be profitable," adding, "We haven't established a distribution network for secondary markets." For now, manufacturers are handling those markets.

by Sandra Arnoult


http://www.atwonline.com/news/other.html?issueDate=9%2F30%2F2005


Maybe Fred Greed can use the surplus 50 seaters on a shuttle service every 5 minutes from MDW to EWR for Virgin America? Businessmen love frequency........


Bye Bye--General Lee
 
I also hear Delta has a surplus of domestic flying. I know you enjoy the woes of regional pilots, but its not too fun when it hits to close to home, is it?
 
Skaff said:
I also hear Delta has a surplus of domestic flying. I know you enjoy the woes of regional pilots, but its not too fun when it hits to close to home, is it?

Skaff,

I don't think he was making fun of anyone. The General has been predicting the RJ glut for years it seems. This industry is going to heck quickly and everyone will be impacted.
 
All hail to the King of the Cheap Shot Artists

Not making fun of anyone? Perhaps, but the intent of the General's post is loud and clear. When he's not taking aim at regional pilots, he's attacking the aircraft we fly. No aircraft, no jobs. Pretty transparent, I'd say.

The little smiley face says it all.

.
 
FlyComAirJets said:
Not making fun of anyone? Perhaps, but the intent of the General's post is loud and clear. When he's not taking aim at regional pilots, he's attacking the aircraft we fly. No aircraft, no jobs. Pretty transparent, I'd say.

The little smiley face says it all.

.

Actually if you read the whole post.
Maybe Fred Greed can use the surplus 50 seaters on a shuttle service every 5 minutes from MDW to EWR for Virgin America? Businessmen love frequency........
I think you'll see that he was not poking fun at rj pilots, but at the surplus of these useless (50 seat) aircraft!
737
 
Skaff said:
I also hear Delta has a surplus of domestic flying. I know you enjoy the woes of regional pilots, but its not too fun when it hits to close to home, is it?

That's true. So, we are moving some domestic 767ERs and some 764s to fly international flights that don't compete with LCCs. 28 planes to be exact. We are cutting 16% domestic and adding 25% international. We are parking some older 737-200s and some 733s also. But, we are also using our operation clockwork stage 2 to increase turn times on domestic narrowbodies to try to make up for some of the loss. If you think they are going to downsize too much in ATL and allow the LCCs to get bigger there, you are wrong. A lot of the downsizing is in CVG.

Bye Bye--General Lee
 
FlyComAirJets said:
Not making fun of anyone? Perhaps, but the intent of the General's post is loud and clear. When he's not taking aim at regional pilots, he's attacking the aircraft we fly. No aircraft, no jobs. Pretty transparent, I'd say.

The little smiley face says it all.

.

That isn't a smiley face. I hardly ever use a smiley face anymore. That is a "miffed" face. Look at it again.

Hey, I don't think the 50 seaters being used against the LCCs is very smart. That's why more 70 seaters are being ordered, and maybe even some larger ones (let's hope for mainline above 70 seats...). Most of the 50s will probably be replaced by 70s. Lower fares from LCCs and higher fuel (that Delta pays for---SkyWest says they are "insulated" from high fuel costs----good for them...) makes the 50 seaters obsolete unless they fly to places not visited by those LCCs. Those places are dwindling.

And, I don't like any job losses, and I am certainly not overjoyed about possible Comair furloughs. Nope. Don't forget we had 1310 mainline furloughs.


Bye Bye--General Lee
 
Last edited:
General Lee said:
Airline bankruptcies could create regional jet surplus


With Northwest Airlines set to return 15 CRJs to lessors and Delta Air Lines expected to downsize its wholly owned Regional subsidiary Comair, eyes are focused on Independence Air, which could saturate the market for 50-seat regional jets if it enters bankruptcy and liquidates as some analysts expect.

Bye Bye--General Lee

The last I heard northwest had not named ANY CRJs as excess or potential excess aircraft to the bankruptcy court. Also, last I heard pinnacle made a statement that they were putting these aircraft into long term storage. Maybe Sandra didn't do her homework (or maybe I am wrong) but I dont think any CRJs are being returned to lessors yet. Probably not smart to return RJs to the same lessors you potentialy want to get your 70-90 seaters from.

Excess and Potential aircraft named in the bankruptcy so far (respectively

http://bankrupt.com/misc/northwestexcessaircraft.pdf
http://bankrupt.com/misc/northwestaircraftleases.pdf
 
Last edited:
Heavy Set said:
This industry is going to heck quickly and everyone will be impacted.
Now we have to be impacted too? Great! Just when I thought they wouldn't go there...whoops, there it is.:smash:
 

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