Jano
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Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 3:48 am

http://www.bizjournals.com/twincities/stories/2004/12/06/story2.html

The deal, which was approved by Northwest pilots a month ago, gives Northwest $265 million in labor concessions, which Northwest said it needed to compete in the grueling airline industry.

It also lets Northwest add 40 new 50-seat regional jets to its network -- but only if they're flown by a carrier other than current affiliates Mesaba Airlines (owned by MAIR Holdings Inc. of Minneapolis) or Pinnacle Airlines Corp. of Memphis.


...

Though it might seem strange for NWA pilots to negotiate a deal that allows the airline to expand using other carriers, observers said the union is hoping the deal strengthens Northwest overall. In documents describing the deal to pilots, the Northwest Air Line Pilots Association (ALPA) said gaining a new regional partner would give Northwest "offensive and defensive marketing capability" should another major carrier drop out.
The Widget Air Line :)
 
PSU.DTW.SCE
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RE: Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 3:51 am

In reality, its a lot more complicated than the article states.
 
geg2rap
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RE: Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 3:58 am

hmmmm...backup plan for air wisky??
Question to NW people, is there preference for Mesaba/Pinnacle pilots to move up to the big boys? (when that day comes again). Interesting they would do this too, why wouldn't they say they have to go to existing airlink partners?
 
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N328KF
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RE: Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 3:59 am

PSU.DTW.SCE:

Care to elaborate?
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bigtidi
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RE: Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 4:05 am

could it be a new code share for Mesa Airlines?
 
N801NW
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RE: Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 4:27 am

IIRC, in the event another airline fails, NW could quickly sign up a third Airlink partner to fly pax from the defunct carriers hub(s) to NW's hubs. ie, PHL-DTW, CLT-MEM, etc. NWALPA is betting that that could lead to more flying for them from the Hubs.
 
m404
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RE: Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 5:36 am

Might also yet another way for NW to use the third carrier as leverage in future bargaining talks with pilots and owners?

Interesting ideas for quick entry to PIT. Perhaps Independence might even be in the sights.

What I don't understand about the quick logistics scenario is that say NW has the 40 CRJs and crews. Those acft are not going to be delivered all at the same time. Bombardier is already slowing down the lines. What would they do in the meantime while waiting to pounce on a vacant hub? Only the 10 CRJs for Pinnacle have been ordered since this signing. Could this actually be for an airline already in existence?

This is really interesting when coupled with Northwests long professed feelings that ownership of a link partner is not as desired a contracting relationship.

[Edited 2004-12-06 21:37:05]
Less sarcasm and more thought equal better understanding
 
ATWZW170
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RE: Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 6:55 am

Back up plan for Air Wisconsin...I hope so. I'd love to see AWAC fly for NW. I know it's only 40 planes but if we keep the UA flights and pick up NW...that would be nice! And if god forbid we lose the UA flying...the NW routes would ensure that some of us stay on board.
Success is getting what you want...happiness is liking what you get
 
OH-LGA
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RE: Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 7:43 am

We're placing a bid for the flying as well... it will be quite interesting to see who gets it in the end  Smile

Kai
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srbmod
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RE: Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 8:49 am

Maybe IAir could be it......

But in reality, Air Wisconsin could definitely be in the running. I doubt Mesa is looking heavily at adding another airline to run flights for, but perhaps they could operate for NW Airlink under the Midway name and O.C.
 
RCS763AV
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RE: Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 10:48 am

Maybe Air Wisconsin should look at the deal, since they have been dropped by Airtran and now United?
 
roseflyer
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RE: Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 11:25 am

It sounds like the pilot union is allowing NW to take over express work if a mainline carrier liquidates. It seems like NW will assume Chautauqua or another one of US Airways Express carriers operations in the event US fails. It will allow NW to take over a lot of the business of US if they fail. It is a good business plan because it would allow NW to be the first in the market to help all of the frequent flyers of US in their hubs. In the long run this could allow NW to establish a hub or increase flying in a defunct US Airways network. This could be a good thing because it would lead to growth of not only NW express service, but of mainline flights as well. I doubt the pilots want NW to just add another express carrier to their network unless a big carrier liquidates. Hopefully this doesn't happen, but people are acknowledging that it is possible and creating contingency planes.
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IAHERJ
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RE: Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 11:46 am

I'd put my money on Expressjet!!! I think they have the inside track.

IAHERJ

P.S. I don't work for them anymore. Just a hunch.

Actually flown: EMB-120 EMB-145 B717 B737 B757 B767
 
swadispatcher
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RE: Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 11:58 am

ExpressJet has been making uniforms and airplanes more "generic" and several employees have told me that the rumour going around is that they have been looking for a second "partner airline"...
Maintain 2300 until Boiler, cleared for the VOR-A approach, report BATLE inbound..
 
mojo89
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RE: Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 12:07 pm

Maybe Air Wisconsin should look at the deal, since they have been dropped by Airtran and now United?

RCS763av-
Air Wisconsin has not been dropped by United. They have simply put Air Wisconsin's portion of the flying out for bid.
When the going gets weird, the weird turn pro. -Dr. Hunter S. Thompson
 
PSU.DTW.SCE
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RE: Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 2:21 pm

Its more or less as RoseFlyer states it.

The agreement allows NW to pick up a regional affiliate virtually overnight in the event of a major airline collapse.

In the event that US or (UA....less likely) goes under, a virtual free-for-all will erupt for some of the more viable markets and instantly a glut of regional feed instantly comes on to the market. Thus NW can come in on short notice and beginning picking up new routes.

Either XJ or PNCL have the resources to do this since all of their aircraft are already committed.

No, AirWhisky is still with United for the time being, despite the Request for bids from United. United is a mess with their regional affiliates.

No, its not ExpressJet. Does ExpressJet have 40 ERJ's lying around? No. And who is going to finance them. This is solely if 40 RJ's suddenly come on the market, and NW sees profitable routes to fly them.

Whoever wrote this article isn't very smart. NW WILL NOT begin regional feed out of SLC or LAS, that is nowhere even close to fitting their business model.
 
PSU.DTW.SCE
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RE: Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 2:34 pm

I meant that XJ or PNCL dont have the ability to do such a thing.

You can argue that NW mainline pilots somewhat shafted the people at Mesaba and PNCL, but this contract is only valid for two years, and I'm sure the language will change at that point.

The regionals are no fun these days, its just like Wal-Mart, who can do it the cheapest and be the biggest whore and backstab your friends.
 
Goldenshield
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RE: Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 2:59 pm

"The regionals are no fun these days, its just like Wal-Mart, who can do it the cheapest and be the biggest whore and backstab your friends."

I don't know about the two latter items, but cost does play a big factor -- not to mention flexibility and aircraft performance.
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ATWZW170
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RE: Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 11:34 pm

I didn't think that Expressjet could bid for the business, don't they have something in their contract that says they can only fly for CO until 2006?

As far as OO (skywest), I'm not so sure they are going to go for it either. How can they bid on both the AWAC routes that were put out for bid and the NW routes, that would be streching themselves rather thin.

I can see RP (Chautauqua) making a bid, good company. They don't have all the overhead that we do here at AWAC, but AWAC would fit NW's modle better.

I would hope that NW would NOT even listen to YV (Mesa). I'm sorry but it's Mesa that makes the Regionals like Wal-mart. Have several different airlines under their banner, all paying crap wages.

But, just my opinion.
Success is getting what you want...happiness is liking what you get
 
toltommy
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RE: Northwest Cleared For 3rd Airlink Partner

Tue Dec 07, 2004 11:58 pm

AFAIK, ExpressJet's agreement with CO allows them to fly for another carrier. HOWEVER, if ExpressJet negotiates a lower price with the other carrier, CO has the right to pay the same rate. So in this race to the bottom on regional pricing, it might not be too good for ExpressJet to get in the game.

Comair? No way. Their labor costs are so high, even DL has passed over them for recent growth. You know NW is looking for the best deal. SkyWest is probably a more realistic bidder.

Chautauqua might have an inside track. Their CEO is the former CEO of Mesaba.

OTOH, NW is so conservative, if they can't get the deal they want, they might not do anything but accelerate delivery of their CRJ order. Everyone wants to grow, but hopefully the regionals will decide profits and stability are better than getting a lousy contract with NWA.

And all this is probably moot if US somehow survives. My hunch is that this is a "just in case" plan to grab markets if US or UA fails. If they don't, it won't be needed. NW has plenty of planes in the pipeline that they can tap.
 
PSU.DTW.SCE
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RE: Northwest Cleared For 3rd Airlink Partner

Wed Dec 08, 2004 3:58 am

Exactly TOLtommy.....

The key part here is that NW has not put out a bid for additional flying.
All it states is the provision is in the mainline pilot's contract, among a whole slew of other provisions. Purely, should the situation arise.

As it stands now, NW really does not need too many more CRJ's at their current hubs. There is simply nowhere to put them. DTW is almost max-ed out spacewise for the regionals until the new concourse C is rebuit.

Also, the big wildcard is the NWA70 issue, the 70 seat issue that will begin negotiation in Feb. Mainline pilots want the 70 seater flying, but NW will only do so if it is profitable.

Thus 70 seaters are in NW's not so distant future. There are a bunch of routes currently being flown with 50 seaters that could be flown effectively with 70 seaters, thus when the time comes, freeing up those 50 seaters to do other things.

Time will tell, but remember that planes aren't free. No regional, unless they are really dumb, is suddenly going to get a whole bunch of RJ's with the hope of NW potentially flying them.

For the time being, there is no one out there that has a bunch of RJ's to fly for NW. 6 months from now, that story may be different. I just don't see any regional ordering new aircraft just to fly for them, I see this scenario occuring if someone is out on the street due to their contract ending with someone else.
 
burnsie28
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RE: Northwest Cleared For 3rd Airlink Partner

Wed Dec 08, 2004 4:03 am

I would hope that NW would NOT even listen to YV (Mesa). I'm sorry but it's Mesa that makes the Regionals like Wal-mart. Have several different airlines under their banner, all paying crap wages.

But, just my opinion.


I wouldnt expect Mesa to really bid for NW, from what ive heard (not sure if its true or not) that NW and Mesa corporate guys have met before and didnt get a long what-so-ever. I know most go to the cheapest, but I know NW has standards, and I think Mesa is far below those.
 
srbmod
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RE: Northwest Cleared For 3rd Airlink Partner

Wed Dec 08, 2004 6:55 am

Now that I think about it, if US Airways does go under, I'd put my money on Mesa becoming the new NW Airlink partner. Chautauqua would probably just start doing additional Delta Connection and American Connection work, as both airlines would probably want to add service or start service on former US Airways/US Airways Express routes, and with Chautauqua currently operating for those airlines, it'd be the quick and easy way to do it. BTW, how many a/c does Mesa currently have operating under the US Airways Express banner? I could see them transferring some of those a/c over to AW Express if US Airways folds. But here's an interesting thought, what about PSA and Piedmont if US Airways goes under? Logically, US Airways would probably start selling off assets a few months prior to filing Ch. 7; they've had assets quote/unquote on the market for awhile now (US Airways Shuttle, gates at various NE airports), and during the failed breakup/merger of US with UA and AA, they had made a deal with ACA to acquire the wholly owned regionals. Perhaps as a last ditch move, US sells PSA and Piedmont to Mesa for some quick cash?
 
ATWZW170
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RE: Northwest Cleared For 3rd Airlink Partner

Wed Dec 08, 2004 11:49 pm

So, tell me if I'm understanding things correctly....NW has the option of 40 more RJ's flown by another carrier but they have no plans of using them at this point?
Success is getting what you want...happiness is liking what you get
 
toltommy
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RE: Northwest Cleared For 3rd Airlink Partner

Thu Dec 09, 2004 1:50 am

As PSU has said, NW has not put out an RFP to regionals to become the third partner.
 
ATWZW170
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RE: Northwest Cleared For 3rd Airlink Partner

Thu Dec 09, 2004 5:39 am

Who says they have to put out a RFP? Can't they just go to a carrier and pick them? United didn't put our an RFP for Mesa and everyone else to join their group. I don't remember Frontier putting one out either when they dropped Mesa and picked up Horizen.
Success is getting what you want...happiness is liking what you get
 
PSU.DTW.SCE
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RE: Northwest Cleared For 3rd Airlink Partner

Thu Dec 09, 2004 6:17 am

They don't have to put out a RFD, but they do have to enter into a contract.

Call it what you want, but none currently exists between NW and anyone.

There may or may not be back room meetings, for now there is nothing.

This is simply a provision in the NW pilot contract scope clause that will allow this, nothing more at this time.