The regional airlines became an economic safety net of sorts after September 11, when the majors quickly realized they could not survive flying large airplanes nearly empty. The options–cut flights and market presence entirely or replace mainline jets with smaller aircraft–presented airlines with a clear course of action. Code-sharing regional airliners quickly delivered cost-effective solutions.
If the HondaJet were being developed by a traditional business jet manufacturer, we would undoubtedly know a lot more about its future. Those who follow new-aircraft projects are used to receiving regular updates on milestones and test results along the way as the manufacturer seeks to reassure stockholders, lure new investors–or both.
Brazil’s Embraer said it will lay off 1,800 workers, reduce deliveries this year from 185 to 160 and lower its forecast delivery rate from 205 to 135 next year as part of a plan to stem losses expected to result from September 11. Although the company said all firm orders remain in effect, it expects a number of customers to defer option conversions until the global economic outlook improves.
Alliance Aircraft has reached an agreement to settle an outstanding debt with its largest creditor–Rocket Science Computer Services–after a Superior Court Judge in Brentwood, N.H., ordered Alliance president and CEO Earl Robinson arrested on contempt charges last month.
The demise of Swiss national carrier Swissair has pushed one of Europe’s largest regional airlines to a critical juncture in its development. Crossair–now fully independent of the bankrupt flag carrier–must chart a new course over unfamiliar territory, leaving investors optimistic over the potential for growth but wary of untold pitfalls.
ERA named German operator Eurowings regional airline of the year at last month’s general assembly, 12 months after the German regional airline placed second in the competition. Eurowings attributes its success to its fleet mix and route network; an appropriate alliance policy with German flag carrier Lufthansa, which has an option to increase its 25-percent stake in the regional to 49 percent; and an attractive “customer product.”
Operator attendance at the European Regions Airline Association (ERA) annual assembly in Athens last month was down about a third, as carriers reassessed fleet strategies under their “worst-ever trading conditions” following the U.S. terrorism attacks and an earlier economic downturn.
Never one to shy away from controversy, Mesa Air Group chairman and CEO Jonathan Ornstein has announced that his airline will begin training its pilots to carry taser weapons in the cockpit. A Mesa spokesperson said the airline expected to complete training and FAA coordination for the plan within three months. Mesa on October 17 began placing private security personnel on its airplanes based in Albuquerque, N.M.
Hesitant to “look a gift horse in the mouth,” Regional Airline Association president Debby McElroy applauded the Office of Management and Budget’s decision to allow bankrupt carriers, including RAA members Midway Airlines and Shuttle America, access to part of the $10 billion in loan guarantees signed into law as part of the Air Transportation Safety and System Stabilization Act.
The September 11 terrorist attacks on the World Trade Center and Pentagon set the stage for an upheaval in the U.S. airline industry unseen since the dawn of deregulation. But while virtually no one besides the enemies of America welcomed the negative economic effects, some airlines may very well emerge from the crisis in a stronger competitive position.