American Airlines (AA, Dallas/Fort Worth) has reached an agreement with regional capacity provider Mesa Airlines (YV, Phoenix Sky Harbor) to end an existing American Eagle partnership as of early April 2023, citing reliability issues.
"Mesa Airlines has experienced various financial and operational difficulties this year. As a result, we have concerns about Mesa's ability to be a reliable partner for American going forward. American and Mesa agree the best way to address these concerns is to wind down our agreement," AA Chief Financial Officer Derek Kerr said in an internal memo.
With Mesa's final flight for American Airlines currently scheduled for April 3, 2023, most aircraft will be removed from American Eagle flying throughout March 2023. The ch-aviation fleets module shows Mesa operates sixty-four CRJ900s on behalf of American Airlines all of which are either owned by the regional carrier or leased from Bombardier Services; none are owned by American Airlines. The CRJs operate out of Dallas/Fort Worth and Phoenix Sky Harbor.
Following the termination of its Mesa partnership, American Eagle services will be operated by American Airlines' subsidiaries Envoy Air, Piedmont Airlines, and PSA Airlines (which also operates CRJ900s), as well as third-party operators Republic Airways and SkyWest Airlines. Kerr said the airline would accelerate the launch of the recently announced partnership with Air Wisconsin to operate CRJ200s in light of the end of the Mesa CPA.
"American significantly raised regional pilot wages for their wholly owned subsidiaries to deter pilots from going to national carriers and attract pilots from the ever-shrinking pool of qualified pilot applicants. American chose not to fund the higher pilot rates for their non-affiliated carriers. At the same time, we were being penalised for not producing the required block hours under our pre-COVID contract with American. These two actions were costing us approximately USD5 million in losses per month," Mesa Airlines CEO Jonathan Ornstein said.
Mesa's only other customer is United Airlines (UA, Chicago O'Hare) for which it operates eighty E175s under the United Express banner, including 18 leased from United and 62 owned by Mesa Airlines, the ch-aviation fleets ownership module shows. It also operates three B737-400(SF)s on behalf of DHL Express and is in the process of certifying a European subsidiary in partnership with Gramercy Associates. Ornstein told staff that the airline was close to finalising a new agreement with United to move its CRJ900s to United Express which would preserve the carrier's existing bases while adding Denver International and Houston Intercontinental.
Currently, the United Express fleet does not include any CRJ900s. The carrier's regional flights are operated by Air Wisconsin (pending its move to American Eagle flying), CommuteAir, GoJet Airlines, Mesa, Republic, and SkyWest.
Mesa Airlines recently deferred the publication of its annual report, initially scheduled to be released on December 12, 2022. It made a USD67 million loss in the nine months through the end of June 2022. Like most carriers in the US, especially regional specialists, the airline is struggling with a pilot shortage and recently announced a range of new training initiatives, including buying Pipistrel Aircraft trainer aircraft. It is also actively pursuing opportunities to invest in various new-propulsion aircraft types.
