Mesa Air files bankruptcy

[Freighterguynow]

http://www.marketwatch.com/story/mesa-air-...nges-2010-01-05

Mesa operates as Delta Connection, US Airways Express and United Express under contractual agreements with Delta Air Lines, US Airways /quotes/comstock/13*!lcc/quotes/nls/lcc (LCC 5.11, +0.34, +7.13%) and United parent UAL Corp. /quotes/comstock/15*!uaua/quotes/nls/uaua (UAUA 13.53, +0.73, +5.70%) , respectively.

 

[Travel Is My Life]

I would not want to see the many good people that work for Mesa go out of a job but I sure would love it if this were a sign that Mesa would cease operations. Mesa has easily got to be one of these worst regional carriers. Thjey make mainline US look like the best airline out there...

 

[Poug Darker]

Does this mean US can drop the contract with Mesa?

 

[jimcfs]

Does this mean US can drop the contract with Mesa?

Or can US restructure the agreements?

Here's another question... how much flying does Mesa do for US?

 

[ClueByFour]

Does this mean US can drop the contract with Mesa?

Long shot, unless there is a contractual provision for insolvency.

OTOH, Mesa can dump the US contract. Dunno if they'd do it or not.

 

[USA320Pilot]

Mesa Airlines’ “formal reorganization†should effect US Airways’ distribution of proposed DCA expansion from the Delta Slot Transaction, if and when approved by the federal government, and improve the Tempe-based company’s financial outlook as Mesa’s aircraft are incrementally removed for US Airways’ network.

Mesa operates over 60 aircraft for US Airways Express including 50-seat and 90-seat RJs and DASH-8 aircraft. Mesa’s “fee for service’ agreement expires with US Airways in less than one-year on January 1, 2011; however, with the Express company now in bankruptcy it can reject aircraft agreements and negotiate new “fee for service†contracts with legacy partners. Mesa indicated today it has a fleet size of 130 aircraft with 52 being unused/parked and it will retire 25 more aircraft, for a total reduction of 77 of its 130 aircraft or 59 percent of its fleet will be removed with only 53 aircraft remaining. And, it’s unclear if US Airways can now remove some of Mesa’s flying on its own because of Mesa’s bankruptcy filing, but one thing seems certain is that there will now be tough negotiations between the two companies going forward.

It is my understanding Mesa’s bankruptcy will permit US Airways to fly a large percentage of its new/pending DCA routes/slots obtained from Delta Air Lines with Mainline aircraft because current LGA Express flying required to be flown by contract with other “fee for service†companies like Republic and Air Wisconsin; along with wholly owned Express company Piedmont Airlines, will have their DCA flying reallocated to CLT, PHL, PHX to backfill the reduction of Mesa ASMs.

For example, Piedmont Airlines is likely to open PHX as a station and Crew Base; probably along with Republic and or Air Wisconsin; as well as CLT and PHL.

I understand that about 30 of the 42 new DCA mainline slots now can be flown with mainline ASMs when unprofitable BOS off-season Caribbean flying is pulled down (DCA cannot be expanded until 91-days after the government approves the current Delta-US Airways transaction) on May 2, 2010. Assuming the government approves the deal before the end of January, the pending BOS pull down and DCA expansion now could occur simultaneously with the May 2, 2011 Crew Base Closure and System Schedule change.

For short-haul flights of about 1-hour two slots equals about 1 East “Primary Line†and longer range flights have a lower ratio. Thus, 30 slots of mainline flying could add at least 15 Primary Lines for East Pilots and 45 Primary Lines for Flight Attendants to DCA. And, if US Airways is successful at getting DCA perimeter rule exemptions for flights to the Caribbean and the West Coast, as proposed by Doug Parker in a recent Crew News session, then these longer range flights could add even more Primary Lines to DCA flying due increased future ASMs.

In my opinion, Mesa’s bankruptcy filing and likely removal of flying from US Airways’ network will enable US Airways to shift about 15-20 of BOS’s 40 Primary Lines to DCA with the remainder split between PHL and CLT in the May East Pilot Permanent Bid. This decision has likely already been made with Andrew Norcella’s Department with final information being worked on by Resource Planning; although the Company has/is considering new East Pilot Permanent Bids for earlier than May 1, 2010.

Mesa’s bankruptcy filing, Continental’s report of better than expected December revenue, new fare increases, and stable oil prices are having a material effect on US Airways’ stock price with the security up 48 cents to $5.25 in early morning trading.

Regards,

USA320Pilot

 

[aptboeses]

Does this mean US can drop the contract with Mesa?

According to this document YES.

The code-share agreement is subject to termination prior to that date in various circumstances including:

* If our flight completion factor or arrival performance in our Phoenix hub falls below certain levels for a specified period of time, subject to notice and cure rights;

* If either US Airways or we become insolvent, file for bankruptcy or fail to pay our debts as they become due, the non-defaulting party may terminate the agreement;

* Failure by us or US Airways to perform the covenants, conditions or provisions of the code-share agreement, subject to 15 days notice and cure rights;

* If we or US Airways fail to make a payment when due, subject to ten business days notice and cure rights;

* If we are required by the FAA or the U.S. Department of Transportation ("DOT") to suspend operations and we have not resumed operations within three business days, except as a result of an emergency airworthiness directive from the FAA affecting all similarly equipped aircraft, US Airways may terminate the agreement;

* Upon a change in our ownership or control without the written approval of US Airways.

http://www.sec.gov/Archives/edgar/data/810...013/form10k.htm

 

[Travel Is My Life]

Long shot, unless there is a contractual provision for insolvency.

OTOH, Mesa can dump the US contract. Dunno if they'd do it or not.

My understanding is that the contract with Mesa actually is expiring this year so US could dump them if they wanted to and I sure hope they do!! The only problem is though, is there another regional out there that has the current resources (or ability to quickly increase the resources) to take over all the flying that Mesa currently operates for US?

 

[USA320Pilot]

Today in a note to employees US Airways said, “This morning one of our regional airline partners, Mesa, filed for bankruptcy protection. For US Airways’ customers, Mesa has committed they will continue to operate their full schedule. US Airways customers should not see any disruption to their travel plans as a result of Mesa’s reorganization. Mesa currently operates 53 CRJ900, CRJ200 and Dash 8-200 aircraft for US Airways and complements larger jet service in approximately 70 markets. We will keep employees and customers updated on any changes to US Airways’ service throughout Mesa’s reorganization.â€￾

In my opinion, US Airways will incrementally reject most or all of Mesa's unprofitable flying and shift current LGA Express flying to backfill many of the current markets flown by Freedom Air and Mesa.

Regards,

USA320Pilot

 

[wopr21]

Can't Mesa still continue to fly under C11 as did Usairways?

I can only pray for the good employee's of this retched airline. I hope they can find greener pastures.

No employee should be treated as bad as Mesa has treated theirs.

Mesa management has lowered the bar once again and is now suffering the consequences.

Actually the employees will suffer the most and management will again walk with MILLIONS.

wopr

 

[Poug Darker]

Keep Piedmont flying, dump Mesa. Take care of our own first.
Cheers.

 

[RightTurnClyde]

The current rumor in SBY is that Piedmont is looking at all of Mesa's Dash 8-200's (16 of them I believe). Piedmont would open a PHX base to take over that flying with the remainder of the Dash 8's used to replace the older Dash 8-100's that are not good candidates for the life extension program.

 

[PITOCC71]

My $.02:

US should use YV's chapter 11 to dump ALL YV flying.

YV CR9s should be replaced by RP E-175s as they become available as the E-jet is much more comfortable and passengers will appreciate the larger overhead bins and roominess.

Replace YV Dash 8s in PHX with Piedmond 8s or, if necessary, find another partner with turboprops in the same seat range. Skywest, Colgan are two carriers that immediately come to mind.

If any YV ERJs are still out there replace them with CRJs or CR7s. PSA CR7s would make more sense as it seems 50 seaters are no longer as profitable given increased operating costs.

Regardless of what happens I wish the best of luck to those employed with YV, especially since I know quite a few people there. I also hope this wakes up the BOD there that J. Ornstein is bad for YV and should be sent packing ASAP, preferably without any golden parachute.

 

[Piedmontegheny]

The current rumor in SBY is that Piedmont is looking at all of Mesa's Dash 8-200's (16 of them I believe). Piedmont would open a PHX base to take over that flying with the remainder of the Dash 8's used to replace the older Dash 8-100's that are not good candidates for the life extension program.

Works for me!

Could we then call the west base Piedmesa?

 

[aquagreen73s]

* If either US Airways or we become insolvent, file for bankruptcy or fail to pay our debts as they become due, the non-defaulting party may terminate the agreement;

I know it won't happen, but this is an opportunity for Doug to do the right thing. Every furloughed pilot could be brought back immediately if mainline absorbed the Mesa flying. There's a slew of 737-300s available for lease at penny rates.