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By: 6th January 2006 at 17:22 Permalink - Edited 1st January 1970 at 01:00
-Interesting idea that would be good to see catch on
By: 6th January 2006 at 17:37 Permalink - Edited 1st January 1970 at 01:00
-We (ExpressJet) just had 69 airplanes pulled from our Capacity Purchase Agreement by CO. We have first rights to those 69 airplanes, the only stipulation is that we can not fly them for CO or in/out of their 3 US hubs if we decide to keep them. One possible rumor is that we'd operate those as a part of this new European operation. We must figure out what we are going to do with those 69 airplanes, or if we want them at all, in the next 6-9 months. As you can see from the article that matches up with the time frame they quoted for the European operations.
2006 is already looking to be an interesting year.
By: 6th January 2006 at 18:22 Permalink - Edited 1st January 1970 at 01:00
-er, have to say i'm a little confused! CPA?
By: 6th January 2006 at 18:52 Permalink - Edited 1st January 1970 at 01:00
-Capacity purchase agreement (CPA). Does this mean that the regional airline would recieve its revenue on the basis of the capacity it provides to the airline it is feeding, and not on the basis of number of passengers flown? So a similar agreement to a wet-lease charter?
By: 6th January 2006 at 19:06 Permalink - Edited 1st January 1970 at 01:00
-Capacity purchase agreement (CPA). Does this mean that the regional airline would recieve its revenue on the basis of the capacity it provides to the airline it is feeding, and not on the basis of number of passengers flown? So a similar agreement to a wet-lease charter?
We operate under a CPA with CO. CO pays a flat hourly rate for our airplanes. In other words, they bought all our seats at a fixed rate for the 5 year span of the CPA. Our profits are capped at 10% so anything above the hourly rate + 10% profit margin CO pockets the extra. We get paid no matter how many folks are flying in the back so we do everything we can not to cancel a flight. It's a rather moot point though as we seem to always be in an oversold situation at the gate.
Obviously it's great for the regional partner as you have a guaranteed income for the life of the CPA. As long as the passenger loads are reasonable it's good business for the parent carrier. There are obviously downsides for both sides. The parent company is locked into a fix expense that can hurt during tough economic times as you can't shop around for a lower cost operator/feeder. The regional partner operates how/where/when the parent company wants them to. It plays havoc on crew scheduling/hiring/staffing.
CO deciding to withdraw 69 airplanes from our CPA could be just a political move in order to get a rate adjustment or could not be. Obviously rumors are a plenty right now.
By: 6th January 2006 at 19:46 Permalink - Edited 1st January 1970 at 01:00
-Thats interesting, Thanks WD.
By: 6th January 2006 at 21:26 Permalink - Edited 1st January 1970 at 01:00
-This sounds very interesting. Any idea wher ethe airlines HQ would be or would that depend on what airline(s) they fly for
By: 25th January 2006 at 09:30 Permalink - Edited 1st January 1970 at 01:00
-There base is rumoured to be Cork, intresting development, lets see how is gets on as I think 69 regional jets woudl be a lot of capacity for one or two of the majors in Europe as they already all have there regional arms.
By: 25th January 2006 at 09:59 Permalink - Edited 1st January 1970 at 01:00
-I'm always a supporter of regional operations, so i'm very interested to see the outcome of this!
By: 25th January 2006 at 20:39 Permalink - Edited 1st January 1970 at 01:00
-WIth BA Connect starting to off load its BAe aircraft and keeping its 145's, they could be a potential customer.
What do you think?
Lee
Posts: 1,342
By: rdc1000 - 6th January 2006 at 17:06
The concept finally arrives here in Europe.