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Why Do Airlines Have To Have Regional Divisions?  
User currently offlineAirplanetire From United States of America, joined May 2001, 1809 posts, RR: 2
Posted (11 years 9 months 1 week 5 days 23 hours ago) and read 2736 times:

Why does it seem that so many major airlines always have at least one regional airline within their airline? For instance, Delta has several. One of them is ASA. They operate flights on behalf of Delta. They wear the Delta livery. Why must major airlines always buy a regional airline? What is wrong with just getting regional aircraft within your own airline and still have it be part of the mainstream airline?

4 replies: All unread, jump to last
 
User currently offlineB747-437B From , joined Dec 1969, posts, RR:
Reply 1, posted (11 years 9 months 1 week 5 days 23 hours ago) and read 2733 times:

What is wrong with just getting regional aircraft within your own airline and still have it be part of the mainstream airline?

You can maintain lower costs for labor by treating each division as a seperate airline and paying their staff lower wages.


User currently offlineSrbmod From , joined Dec 1969, posts, RR:
Reply 2, posted (11 years 9 months 1 week 5 days 6 hours ago) and read 2678 times:

Delta originally had small ownership stakes in ASA, Comair, and Skywest. They over time, increased their stakes in EV and OH to prevent them from signing agreements with other airlines. Their stake in Skywest has lessened because they are slowly but surely rethinking their Delta Connection operations out West. ASA and Comair are based out of major Delta operations, CVG and MCO for Comair, ATL and DFW for ASA. With Comair being replaced in Florida by Chautauqua, look to see some Comair ops increase @ DFW and perhaps even starting flights@ SLC. The regional airlines were bought up in order to protect airlines. Why else is Piedmont, PSA, and Allegheny wholly owned regionals of U.S. Airways? And the same for American Eagle? One of the reasons why ASA was purchased by Delta was that in the mid-90s, Valujet was rumored to be interested in buying them (VJ co-founder Robert Priddy was one of the founders of ASA), and Delta was involved in a heated war against them.

User currently offlineBWIA 772 From Barbados, joined May 2002, 2200 posts, RR: 2
Reply 3, posted (11 years 9 months 1 week 5 days 3 hours ago) and read 2647 times:

Even here in the Caribbean our 2 main airlines have regional divisions and they are 2 regional airlines.

The reason why they are regional divisions is quite simple really, it to reduce cost and improve service. Eg BWIA created its regional service Bwee Express so that the airline's jets will be more available for the international routes. It is cheaper to operate turbo props on island hops comapared to that of a 737, MD83 or the L1011



Eagles Soar!
User currently offlineJhooper From United States of America, joined Dec 2001, 6199 posts, RR: 12
Reply 4, posted (11 years 9 months 1 week 4 days 18 hours ago) and read 2615 times:

As an economics major, I have to say B747-437B gave the best answer.


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