Aparently among the 59 Midwest people getting laid off the other day, primarily at headquarters, were people who had been working on bringing the E170's on to the Midwest certificate. This was reported by Sideflare, who hsa been a level-headed source of internal information all along. I don't think he himself was part of the 170 workgroup, but he was also among those laid off.

Assuming this is true, it could mean a few different things:

(1) It has been decided that the E170's will not come in house.

(2) The lack of a labor agreement has delayed the project enough that it doesn't make sense to have those people on the payroll until their project can move forward.

If it is (1) that begs the obvious question on what happens IF the rest of the 717's go. That is not a foregone conclusion, and for those who say that clearly Mexicana's desire for 25 aircraft is not conincidentally the number of Midwest's original order, it is indeed conincidence. Mexicana is replacing the 25 Fokker F100's they have...that's where the magic 25 comes from. That being said, it certainly could be that the 717's will be gone in a year or two. What that means if Midwest has no planes on their certificate, I'm not sure.

If it is (2) then if they come to an agreement with labor, the project would resume. If negotiations are not going well, this is something of a "nuclear option" on the part of managment.

I don't think there's any good way to know which one is more in line with what's going on. I don't think anyone anticipated the E170 deal when that came out of left field last fall. Who knows what contingencies they have in mind if any of these speculative things happen. Note that contingencies aren't always good.