Akulashark

I saw a while back that UA is going to buy some planes for UX, my downline airport is pretty full of UX flights. But, why is it that we need this?

Is there a regulation for having a certain size plane for United to fly? Why not just have some E170s in the mainline fleet?

Just curious if anyone knows the ins and outs of this kind of decision.

star_world

If UA operated the aircraft themselves, they would have to pay the crew significantly more than the 3rd party regional operators do. This type of structure allows these smaller aircraft to be part of the fleet, but without that significantly higher cost.

There's no regulation that dictates this, just competitive pressure.

UA can likely negotiate better prices, has more advantageous financing terms and needs the flexibility to have the aircraft operated by different subcontractors in the future, which is why they are interested in purchasing the aircraft themselves.

bob_the_d

costs to outsource are lower, i assume. as far as i'm aware, it's not plane size that dictates whether it's flown by mainline or UAX, but rather the total number of seats on the plane. that's why the new E170's that are entering service have 12F, to keep the total seat count down so mainline pilots aren't flying it.

or something like that.

http://en.wikipedia.org/wiki/Scope_clause

Baze

Because it is much cheaper to contract to these "regional" airlines where labor costs are MUCH lower.

eagle007

I also think the union/labor issue is the number one driver, but are there other major ones?

Akulashark

Usually anytime someone says that labor cost is too high for union employees someone else chimes in and says they aren't higher cost.

Either way, I guess contracting to a lower cost organization is a good way to make it less expensive but, making your customers endure the lower cost option is a good way to drive them away as well. Express Jet is a great example of a "cheaper" organization but they are the worst for MX and angry FAs. They are often the operating company for flights that have this announcement "due to the short duration of the flight, there is no beverage service" on the same flights that often do have a beverage service.

Thanks for your perspective on this.

mre5765

The pilots in regional carriers are paid much less than pilots in mainline.

http://willflyforfood.com/airline-pi...c-Airways.html

http://willflyforfood.com/airline-pi...-Airlines.html

A Republic E170 Captain is paid as little as $59 per hour. A UA A319 Captain is paid as little $123.38 per hour.

I doubt the mainline pilots as a whole oppose adding RJs to the mainline fleet (though some might oppose on safety principles) but they will oppose paying 70 seater RJ pilots under 50% of an A319 pilot. Clearly the pay scales are not purely based on the number of seats in a plane, though that is a factor.

If I had a BIS mile for every time I heard a non-FF express surprise at how small the RJ is out of COS to a UA hub, I would be a lifetime GS by now.

I don't think UA is worried about driving customers away. Frequent flyers based out stations understand that this is way it is, and moreover they (we) appreciate that the extra segment and 500 mile minimum contributes to gaining elite status and more RDMs for award travel.

I don't see WN adding flights to COS. Alaska is, but those are RJs.

Infrequent flyers are just that; infrequent. They will get on the RJ, complain, swear they will never fly UA again, and a year later when UX is the cheapest flight again, or UX lets let avoid driving 100 miles in snow, they will book UX again.

drewguy

I think they would oppose them for that reason . . . if UA added RJs to the mainline fleet it would potentially result in the retirement/lease termination of some larger planes, leading to a basis for lower pilot pay.

Shareholder

UNIONS. As others have noted, the collective agreements that UA has would make flying regional jets too expensive. Also, by contracting out these services, third parties bid lower operating costs to provide these flights. It also saves UA the capital cost of these airplanes, or their leases. Many, many other reasons.

FWAAA

In addition to the much lower pilot payrates paid by the regionals, the flight attendants are much cheaper, as are the agents, mechanics and baggage handlers. Everyone working for the regionals is paid less and generally enjoys stingier benefits than the mainline employees.

Nothing is stopping UA (or any other legacy) from flying regional jets as mainline except the costs.

Jorgen

So what's stopping UA from firing its existing high-cost employees, sending its UX employees overseas to get trained on larger aircraft (not in that order) and operating the whole fleet at lower cost?

Baze

UA has no UX employees. UX are contracted regional airlines like SkyWest who contracts to multiple carriers.

Jorgen

Well okay, but it should be possible to lower labor costs overall with a wholesale sacking of overpaid employees and replacement with lower-cost employees.

If someone out there is willing to fly a CRJ for $60 an hour there ought to be someone out there willing and able to fly a 737 for $60 an hour; most RJ pilots would kill for the chance to fly a bigger aircraft.

Baze

It's called Unions.

ajGoes

As noted, UX does not belong to UA. It's a set of smaller airlines that provide contract services to UA.

Even so, UA has contracts with its unions which would make it impossible to fire their staff and remain in business.