Embraer president and CEO Mauricio Botelho reflected on the events of September 11 and their subsequent effect on the world’s aerospace industry with a quote from Argentine-born Cuban revolutionary Ernesto “Che” Guevara. “We must be tough without losing tenderness,” said Botelho during a lavish dinner affair the evening before the October 29 rollout of the newly branded 70-seat Embraer 170 regional jet.
The profound damage inflicted by the September 11 terrorist attacks brought changes to the U.S. airline industry the most prescient observer could not have envisioned three months ago. Twenty-percent industrywide capacity cuts, furloughs and layoffs, large-scale route transfers from mainline carriers to regional affiliates and aircraft delivery deferrals have all marked one of the most volatile periods in the industry’s history.
Despite United Airlines’ apparent decision to abandon its attempt to buy US Airways for $4.3 billion, the airlines agreed to submit to the Justice Department a merger proposal for full review in compliance with a 21-day review period requirement, prompting applause from DC Air CEO Robert Johnson, who pledged to locate his airline’s headquarters in Washington if the merger survives Justice Department scrutiny.
Mesa Air Group last month reversed its decision to establish a new Cincinnati base and canceled all the flights scheduled to six cities from Cincinnati/Northern Kentucky International Airport for July 8. Mesa contacted all affected passengers and reaccommodated them on Delta Air Lines or Comair flights.
Phoenix-based Mesa Air Group has signed a memorandum of understanding to enter a new fleet management program with Pratt & Whitney Canada that would include the sale of “certain assets” related to its Desert Turbine Services unit and spare PT6 engines. The tentative six-year deal covers 58 Beech 1900Ds and 116 engines, valued at some $70 million.
CCAir president Carter Leake last month notified his employees that parent company Mesa Air Group planned to close the money-losing regional airline on July 1. Leake’s memo arrived on the same day as Mesa’s latest contract proposal to CCAir’s pilots. The pilots rejected a previous proposal.
Less than nine months into a pro-rate code-share contract with Frontier Airlines that called for the introduction of seven Bombardier CRJs into the Frontier system by year-end, Mesa Air Group has begun to curtail its relationship with the Denver-based low-fare carrier as a lingering environment of razor-thin yields has resulted in “less than satisfactory” returns for Mesa, according to a company official.
Obstacles against the development of a thriving regional airline industry in Latin America in many respects look as formidable as ever. Lack of capital availability, inadequate airport infrastructure, government interference and a lack of open-skies treaties between nations continue to hinder progress in a region that, in terms of sheer size, holds as much potential for growth as any other in the world.
Regional Aviation Partners (RAP), the new Phoenix-based lobbying organization established by Mesa Air Group chairman Jonathan Ornstein as an advocate for small-community air service, has attracted its first new airline member and a pair of high-profile regional aircraft manufacturers in time for the start of the next congressional session this month.
Jonathan Ornstein has learned something over the years about mending fences–and breaking down barriers. Although the outspoken and sometimes brash chairman and CEO of Phoenix-based Mesa Air Group has fought his share of battles during his 13 years in the airline business, Ornstein has found ways to overcome conflicts with those he needs to survive and prosper.