Rumors Fly Over Fate of Midwest Planes

[gt1900]

Hate to say it, but the fat lady is warming up it looks like...

 

[Moustache]

Hate to say it, but the fat lady is warming up it looks like...

Is Skornica back from her sabatical in hell?

 

[GOULET!]

So how long until Republic announces they are purchasing the Midwest certificate and Boeing takes back the rest of the 717? I say in the next 1-2 months. Anybody else?

 

[fam62c]

So how long until Republic announces they are purchasing the Midwest certificate and Boeing takes back the rest of the 717? I say in the next 1-2 months. Anybody else?

Tough call to try to figure out what's going on but I think it's going to be something like that. I would say it's even possible that Republic or someone else who already has operating certificates will only want the name and a few other assets with the intention of doing all the Midwest branded flying on their existing certificate(s). It doesn't seem that anyone would want to inherit many of the liabilities that go with aquiring all of Midwest i.e. HQ and hanger facilities, 717 leases and , unfortunately, a lot of employees with 15-20+ years of service. Unless somebody wants all of this stuff I think that TPG will either need to find a way to liquidate the company in pieces or declare bankruptcy for Midwest. The only other option I see would be for TPG/DAL to maintain Midwest as a marketing company with no flight operations. They would subcontract all of the lift (they are essentially already doing this) from other providers. I just don't see how you can offset the fixed costs of maintaining an operating certificate with 9 planes even in good times let alone a recession.

No matter what happens it will be a sad ending for Midwest and all the employees who have been loyal to that company for years. I can see the large carriers still providing service from MKE to their hubs but beyond that I think that AirTran will end up owning any other profitable O&D flying out of MKE. MKE is kind of a marginal second-tier market and I think that AirTran is one of the few companies with the type of cost structure necessary to be succesful with an operation of any size there. Additionally, AirTran has some connecting potential through MKE that would make their operation not totally dependent on local MKE passengers. They are already doing east and west coast flying from MKE and adding more so they can use MKE to take some of the strain off ATL by flowing connections through MKE which is a much more efficient, less delay-prone airport. The MKE community and local governments have always been good to Midwest and some of that goodwill may now accrue to AirTran as they see Midwest cutting service. Since the TPG buyout Midwest has been doing everything wrong and AirTran has been doing everything right in MKE. The part that will go away will be the network that used to feed MKE from places like MSN, GRB, ATW, GRR, IND, DSM, CWA, etc. These folks will either drive to MKE or choose another carrier that connects their cities to other hubs. If Tim Hoeksema had moved aside five or ten years ago and let a more capable, visionary CEO take over the company things might have turned out differently but this was destined to happen with him at the helm.

 

[Jetjockey]

So it's confirmed what many of us thought.................Tim H sucks as a CEO.

 

[Colonel Savage]

So it's confirmed what many of us thought.................Tim H sucks as a CEO.

Guess you mean this:


Boeing Capital to lease 25 717s to Mexico's Grupo Mexicana


SEATTLE (AP) -- Boeing Co.'s finance arm said Monday it will lease 25 717-200 aircraft to Mexican airline Grupo Mexicana de Aviacion.
The passenger jets will be used by Grupo Mexicana's low-cost subsidiary, Click Mexicana, under a multiyear arrangement. Financial terms were not disclosed.

Chicago-based Boeing, which also makes freight and military jets, faces weaker demand as airlines report lower air traffic amid the economic downturn. The deteriorating world economy has also hurt airlines' ability to secure financing for aircraft.
The airline will start receiving the planes in March, becoming the first North American 717 operator outside the United States. Boeing said it will also provide training for flight and cabin crews and maintenance staff, as well as spare parts.
The 717s will be configured to carry 104 passengers and will replace Fokker F-100s currently operated by the airline.
Tim Myers, Boeing Capital Corp. vice president for structured financing, said in a statement that the 717 offers greater fuel efficiency, lower maintenance costs, a modern flight deck and a spacious interior. Shares of Boeing rose 90 cents, or 3 percent, to close at $31 Monday.

 

[GOULET!]

Same story basically but from a different source:

Boeing's deal with Mexicana casts doubt on future of Midwest's 717 fleet

By Tom Daykin of the Journal Sentinel
Posted: Mar. 9, 2009 9:45 p.m.
A group of Boeing 717 jets formerly used by Midwest Airlines Inc. will be leased to a Mexican airline, raising questions about the fate of Midwest's remaining Boeing 717s.
Boeing Capital Corp. said Monday it has agreed to lease 25 Boeing 717s to Mexicana Group.
In recent years Midwest's main fleet consisted of 25 Boeing 717s, but the Oak Creek-based airline returned 16 jets to Boeing in September to cut costs. Until last fall, Midwest was one of the larger users of Boeing 717s, which are no longer made.
Midwest still leases nine Boeing 717s. But the September return gave Boeing Capital options to require Midwest to return the remaining nine 717 aircraft with varying notice periods, according to Securities and Exchange Commission filings.
The first group of Boeing 717 jets leased to Mexicana will be the aircraft returned by Midwest, Boeing Capital spokesman John Kvasnosky said. The source of the remaining nine jets committed to Mexicana hasn't been determined yet, he said.
"That's an item for future discussion," Kvasnosky said. He declined to comment further.
Midwest plans to continue operating with the Boeing 717 jets, airline spokesman Michael Brophy said.
"In terms of a longer term fleet strategy, we've made no decisions on that front but will continue to evaluate what type of aircraft will be the best fit for Midwest," Brophy said.
Some Midwest Airlines routes that once used the Boeing 717s are now flown on smaller Embraer 170 regional jets as Midwest Connect flights operated by Republic Airways Holdings Inc.
The Boeing 717 jets account for 37% of the combined seating capacity of Midwest Airlines and Midwest Connect. The remaining seats are on Midwest Connect flights that use a dozen Embraer 170s, and a dozen Bombardier CRJ200 regional jets flown by SkyWest Inc.

 

[Horrido]

The 717s are on short term leases and you can bet they will go away at some point. The question remains what, if any, plan there is for ME's future. They are still trying to settle law suits, and ram huge pay cuts down the throats of the Pilots and Flight attendants. TPG's orders to Seabury were rumored to be "keep it operating, and keep it out of bankruptcy".
The airline seems very redundant at this point and frankly I'm suprised it's still operating. One would have to assume there is a game plan...but I suspect its not running MidEx as a stand alone airline. I think they might sell the pieces, slots, ect to Republic and may have already made a deal with them to provide expanded feeder service for Delta in return. There must be some reason Republic has invested in MidEx...its certainly not related to financial performance!
A sad end to a once wonderful airline. Regional jets and lousy service.

 

[Propsync]

There must be some reason Republic has invested in MidEx...its certainly not related to financial performance!

It's to keep Republic as the 'large RJ' provider for Delta. It's a pay for play.

 

[Colonel Savage]

It's to keep Republic as the 'large RJ' provider for Delta. It's a pay for play.

It's amazing how much money these companies can come up with when they want to facilitate some deal, but employee pay or benifits? Forget it!

Recently "bankrupt" Delta terminating pensions and then turning around and buying NWA comes to mind for some reason.