Rankin’s Work Ethic Buoys Air Wisconsin and RAA

 - April 26, 2011, 9:15 AM

A born and bred product of Wisconsin, Jim Rankin brings a Midwestern work ethic to his duties as RAA chairman and CEO of Air Wisconsin alike. For the last five years Rankin has led Air Wisconsin through a volatile period in which his avowed conservatism kept the carrier on a level and profitable track. Should Rankin bring the same sort of stability to the RAA, the board of directors should consider itself fortunate.

A member of the RAA President’s Council for the past 10 years and the executive committee for the last three, Rankin also brings an intimate knowledge of the inner workings of the RAA and the “challenges” its members face. As the association prepared for its annual convention in May, the former Midwest Airlines MD-80 pilot and Skyway Airlines president spoke with AIN about his personal experiences at Air Wisconsin and related them to his role as RAA chairman.

What issues would you like to tackle at the RAA convention in May?

Certainly we want to continue the drive toward safety reporting systems. Increasing the level of safety is not only RAA’s concern but with all our member airlines, it’s their number-one priority, as it is at Air Wisconsin. So that’s always top of the list.

The RAA is currently conducting a fatigue study, so we’ll be getting an update on that. That will be interesting, putting the science behind multi-segment operations, for which there’s nothing in the industry right now to help in decision-making where fatigue comes into segment operations.

And, obviously, legislative updates, things like the pilot requirement rule and any passenger rights rules that comes out by then.

Where do you stand on pilot commuting? Do most of your pilots commute?

It depends on their base. At some of our bases there’s virtually no commuting, then we’ve got some bases that have a fairly high percentage of commuters.

Does commuting contribute to fatigue?

Commuting in and of itself should not contribute to fatigue. When I was a pilot, I commuted. So I’ve experienced that. You have to make sure you’re a professional, that you’re well rested when you start a trip regardless of whether you live across the street from the airport or 300 miles away.

What do you look forward to working on this year as RAA chairman?

What I’d like to see continuing this year is a lot of the work that the RAA and certainly the member airlines have done as far as continuing the adoption of and really the enhancement of voluntary safety reporting programs…One of the things along those lines is we want to make sure the data that’s collected is used for its intent, which is obviously to promote safety.

Have all the regional airlines signed up for FOQA and ASAP?

Pretty much…FOQA and ASAP and the voluntary reporting programs.

Ninety-nine percent of the flights on regional airlines are offered on carriers that already have FOQA and ASAP, so that tells you there might be one or two fairly small airlines that are in the process of adopting them.

What has the RAA done to encourage ASAP?

The RAA has an active safety committee, which is made up of all the safety directors of all the regional members, and one of the things that we’ve been proud of is when you think of our convention, it has always been about safety. And so that is where the big safety meeting of the year for all of the companies’ heads of safety occurs, along with some of our in-flight and our flight ops and our training committees.

So the RAA really tries to bring the highest and best standards of safety to the regional members and they are also extremely active in the rulemaking process. So we’re a part of every single ARC that’s out there right now on duty time, safety programs, pilot qualifications, all of those sorts of things that have come up over the past couple of years.

The RAA has played a leadership role in all of those.

How close are we to implementing a new rule on duty time requirements for first officers?

Basically the rules have already passed and been signed into law as to minimum pilot requirements [1,500 hours total time for first officers], but now the issue is more or less implementation, and so the RAA is obviously closely involved in that rulemaking. Part of the issue is the law that came out is quantitative, based on hours. Hours is certainly a metric, but quantity and quality are two different aspects of a pilots’ experience or background.

Now we’re looking at finding a way to recognize the quality of different hours. Think of our military pilots flying fighter jets onto aircraft carriers with nuclear bombs. [Oftentimes those pilots] have [fewer] than 1,500 hours. Many times they have [fewer] than 500 hours. But all of those 500 hours are extremely productive training hours versus someone who might be flying the same routes between two cities with freight at night or something, which might be good experience too, but it also can be the same route over and over. So it’s really trying to look at fine-tuning. The intent is to have a certain level of experience and capabilities… How do we then take what the intent of the quantity is and try to get some sort of quality assessment?

So you’re hoping to come to an agreement on credit for things other than hours in the cockpit. When do you expect to reach a consensus?

It’s one of these things that can go relatively quickly or it could take two years.

What do you view as the most pressing regulatory and legislative issues?

From an industry perspective, probably the passenger rights concepts that appear to crop up from time to time. That is always in the background.

One other thing from a fiscal perspective is NextGen. ATC funding for that is an issue that’s going to be continuing.

And obviously conserving service to small communities, the EAS program, is always a point of debate. It serves 150 cities that otherwise wouldn’t have any air service. When you think of the global economy that we have today, really what people need is access to the Internet and access to air service.

Will the changes to the tarmac delay rule be of particular concern to the regionals?

I don’t know about to the regionals in particular. As an industry we always want to serve our customers well. So we’ll have to wait to see what it says. From Air Wisconsin’s perspective, we haven’t had any instances where we’ve had anyone pass the three-hour mark. We put in a sophisticated system in our SOC–systems ops control–area that alerts us whenever a flight has been on the ground either coming in or going out for more than 90 minutes or two hours, so we haven’t ever had an issue where we’ve had passengers stranded on an airplane.

How many pilots fly for Air Wisconsin and what are your minimums?

We have 670 pilots at Air Wisconsin. The minimums are 800 total time and 100 multi. But we’re hiring people with 2,000 or 3,000 hours total time, and obviously if the new rule comes out we’ll have to change our minimums.

So your minimums are sort of irrelevant at this point. Has the regional airline industry shrunk to such an extent where an oversupply of pilots exists?

The regionals didn’t really shrink too much. The majors reduced capacity pretty significantly in 2008 and what that did is put a lot of pilots on furlough. During those years, while the pilots were on furlough, there wasn’t a lot of hiring going on, so the pilots who were in training at the universities weren’t getting hired right away by airlines, so they were flying other jobs and building more time. So when they come to us now when we’re looking for pilots again they just have a couple of years of experience more than they otherwise would have had.

So you haven’t had any trouble hiring pilots or mechanics?

With pilots we’re seeing a nice steady supply of very qualified candidates; mechanics are a little tougher, mainly due to our geographic area. We have bases in Milwaukee, Norfolk and Philadelphia. Milwaukee is stable, Norfolk is pretty stable, Philadelphia is a fairly young group and we have some turnover in Philadelphia. It’s harder to find people in the Northeast for a few reasons. It’s a more expensive place to live and things like that. There are other large maintenance facilities on the field so they do pull from our ranks.

What is the age and maintenance status of your fleet of 70 CRJ200s?

The average age is eight years old. On the structural side, they have a heavy inspection about every two years. Even though we took a lot of our airplanes within a fairly short period of time, we stretch the inspections out so we do about 35 a year on the structural side. The engines are now getting to the point in our fleet where they’re coming up to their first major overhauls–at about 18,000 cycles–and there’s not that much you can do to smooth that. So 2011 is a pretty heavy year for us on engine overhauls….We also have a landing-gear program that’s really active this year…. So as we look at 2011, we’ve got a great plan in place, we’ve got good people in place, so we’re not anticipating any problems by any means; you just have to keep your eye on the ball that much closer. 

How many engines will you be overhauling this year?

Sixty-four engines out of 153 total.

Are you looking to fly for other major airline partners besides US Airways?

We certainly would fly for others. We’ve been around for 45 years; we’ve been successful over that period of time and I think that is because we’re a fairly conservative, private company and one of the advantages of being privately held is you can have a longer planning horizon; because of that we’re financially stable and we have resources to invest in opportunities as they come about.

I think there are potential opportunities down the road with US Airways; but by the same token there could be good opportunities down the road with other carriers. Obviously a big piece of our history was with United; we were a United carrier, and we currently do ground handling for United. We have about 1,500 employees in our ground handling operation, so it’s a pretty significant piece of our business. Our biggest operation for United is at Dulles; we handle all of the ramp and the inside gate positions for United Express, which is just over 200 flights a day. And we have a number of field cities also. So we’re certainly still active partners with United, just on the ground handling side. We would like to continue to develop that relationship and if we can [expand] it back into flying with them we’d be happy to do that.

Is there any room for growth within the US Airways system?

The word we’ve been getting from [US] Airways is they’re happy with the size of their regional fleet at this point in time. So as aircraft that they have under contract come up for renewal, obviously they’ll make decisions if they want to upgrade to a larger gauge. But they’re kind of trying to keep the same number of tails and upgrade where they can.

[The scope clause] is somewhat complicated as I recall and there’s a certain number of 70-seat aircraft that they can fly, and it’s divided between whether they’re wholly owned or non-wholly owned. There may be some, but I don’t think there’s a huge amount of scope left with their current agreement. Obviously they’re still in discussions with their pilots so that can change.

Are there any particular challenges flying a 50-seat jet exclusively?

Certainly fuel is a big concern in the industry right now, and one of the main topics at our last quarterly US Airways Express meeting with all the Express carriers and US Airways was fuel conservation programs. And we spent a fair amount of time coordinating among all of the different entities that make up the network to find ways to do tankering programs and cost indexing programs and things like that, including a lot of ground operations. US Airways has [made] a significant investment in ground power and ground conditioned air in Philadelphia. Piedmont does the ground handling there; we do a majority of the flying so we can coordinate the ground activities and make sure we’re plugged in; we can shut off the APU and save fuel that way.

But I'm confident there will be plenty of work for 50 seat jets for years to come. While there was a time when there were too many 50 seaters, I think there will always be routes that are too small for 70 and 90 seaters.

What would be the next type of equipment that you would logically consider? Would you stay with Bombardier necessarily, or would you look at others?

Certainly we continue to have updates and we continue to stay close to the OEMs on aircraft that are under certification. For us, a huge advantage of the Bombardier product is the single type rating for our flight crews. From that standpoint, my guess is that it would probably be a Bombardier product, but again, if the economics of something else panned out, we’d be perfectly fine with that.

What is your mix of leased and owned airplanes?

We own half and lease half.

How long do the leases run?

They’re sort of scattered, but we have a ways to go on them.

How long does your contract run with US Airways?

I don’t think we actually disclose that, but it’s a number of years. It’s not anything near-term.

So it’s not as if the leases will last beyond your US Airways deal?

Some may and some may not.

Who owns the company?

It’s a group of investors, and it’s been a long-term group. They’ve owned us since 1993.

Is former CEO Geoff Crowley part of that group?

He is. I believe he’s also still on the board of directors of AirTran.

How has the winter weather affected you this year?

We do about 500 flights a day, almost exclusively up and down the East Coast corridors, so one snowstorm can have an effect on virtually our entire network. And we all know the East Coast has had some significant storms. So, yeah, it’s been a rough winter. We’ve been working hard.

How did it affect your on-time arrival and completion rate performances this year? Did you struggle?

I guess what I can say is that we didn’t have the winter that we would normally have. We had issues. And obviously when you have severe winter weather, you have not only the environment that you’re playing with but also it’s hard on the aircraft, it’s hard on ground equipment, it’s hard on ground workers. So all of those things start to snowball and affect your operation. So, yeah, it’s been a challenge but our folks held up well.

Where do you see fuel prices going?

I don’t know. That’s anybody’s guess. Unrest in the Middle East I think is going to be around a little while longer, but I’m not expecting some breakout to astronomical levels. I think we’ll have days when things look bad and oil goes up and drops back down. I think overall this year it will be higher than when we were looking at 2011 from the summer of 2010.

I suppose that’s US Airways’ problem since it buys your fuel.

Yes, but indirectly that’s us. That’s partly why we’re active in the fuel conservation program. What’s good for our major partners is good for us. They’re our customers.