SkyWest "At-Risk" Flying?
Feb 1, 2023, 3:15 pm
#1
Original Poster
Join Date: Jul 2021
Location: NorCal
Programs: UAMP
Posts: 81
SkyWest "At-Risk" Flying?
Hello all. I was recently reading an article that used the term "at-risk" flying for certain United branded SkyWest routes. I assume SkyWest gets no subsidy from UA for these routes?
I was hoping someone with more knowledge could explain this further?
I was hoping someone with more knowledge could explain this further?
Feb 1, 2023, 4:25 pm
#2
Join Date: Oct 2002
Location: TOL
Posts: 749
Most regional airline flights in the US are covered by a capacity purchase agreement (CPA) with the major airline for whom the regional is flying. Under these agreements, the regional airline earns a fixed fee for each flight they operate. The major airline sells the tickets and they make money if the revenue from the flight is more than what they pay the regional airline to operate it.
At-risk flying moves the financial risk for the commercial success of the route to the regional. The regional collects the revenue from the route (less fees charged by the major airline to sell tickets and put their code on the flight) and the regional makes money if the revenue from the flight is more than their costs to operate it.
At-risk flying moves the financial risk for the commercial success of the route to the regional. The regional collects the revenue from the route (less fees charged by the major airline to sell tickets and put their code on the flight) and the regional makes money if the revenue from the flight is more than their costs to operate it.