Do Regional Carriers’ Present Problems Signal a Profitable New Airline Business Model

A Delta flight, operated by Atlantic Southeast Airlines, itself a subsidiary of Skywest, a company that also operates planes for United. Confused yet?

The pendulum has swung to the other extreme.  Regional airlines – once the only part of the airline industry that made good profits – have now become the least profitable part of the industry.  The earlier careless approach by major airlines to negotiating contracts with the regional carrier partners has been replaced with a ruthlessness that echoes their similar ruthlessness with their own staff and with their passenger services and fees, and now we see generally profitable major airlines and generally lossmaking regional carriers.

But every cloud has a silver lining, right?  And, after all, the nation’s largest and most profitable airline started off as a tiny regional airline – and even now, shows its roots in some aspects of its route network and business model.

In my new article ‘Are Regional Carriers the Source of a New Airline Business Model‘ I first explain the history and evolution of the relationship between major carriers and their regional services, and then point out two different approaches the regional airlines could adopt to build a new business model that would work well for them and for us as traveling passengers.

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