American Airlines’ legendary CEO Bob Crandall famously scribbled “Crush these guys” in a memo about an ailing competitor decades ago – a note that typified the take-no-prisoners mindset of the airline industry then and, apparently, now.
The targets today are two small carriers trying something different. So different that unions are joining with the C-suite to beat back this threat to all things sacred.
The carriers are SkyWest and charter operator JSX. Their sin? Trying to adapt to long-term industry shifts with a new model that combines consumer convenience with a shot at mitigating the pilot shortage, all within extremely rigorous FAA and DOT regulations that govern the airline industry today.
SkyWest has asked the Department of Transportation (DOT) to let its subsidiary, SkyWest Charter, fly 30-seat-and-fewer airplanes under Part 135 and Part 380 certificates - government regulations that cover smaller carriers, usually charter operators. SkyWest would like to fly these smaller airplanes as “scheduled charters” (essentially, charter flights open to others) to destinations that are either already served by the majors; served spottily with or without the Essential Air Service program, or have lost service all together, largely due to pilot shortages.
JSX already flies several dozen routes this way, and has been dragged into SkyWest’s fight.
Those opposing the arrangement include airline labor unions and two major carriers. As the critics tell it, the SkyWest and JSX models will bring the $200 billion U.S. airline industry to its knees, along with safety and the environment and perhaps apple pie.
We think the proposal merits a deeper look, both for consumers and the industry.
First, consumers. JSX today flies from private Fixed Base Operator (FBO) facilities, rather than larger airport passenger terminals. FBOs are less crowded; there’s usually plenty of nearby parking; security screening is less time-consuming than at the big airport. Passengers are all vetted by the TSA Secure Flight process, show ID and answer some questions, have carry-on and checked bags swabbed and quickly cleared by trace detection technology, board their airplane and fly directly to their destinations, often bypassing the hassle of long lines, crowded terminals and/or connecting flights at hubs.
Passengers, as you can imagine, love it.
The industry benefits as well, from a scheme that allows aspiring pilots to move more quickly into the first officer seat of a passenger carrier and thus more quickly into the hiring pipeline at larger carriers. They arrive at those carriers better and more relevantly trained than they can be under today’s regulations.
Today, aspiring pilots in the U.S. are required to log 1,500 hours’ flight time before they qualify for hire in multi-engine passenger fleets (with some exceptions for military pilots). Most trainees gain these hours on their own time and their own dime, mostly by renting recreational airplanes and flying when they can. Gaining the hours can cost tens of thousands of dollars and take up to two years - a significant barrier to entry to the profession.
The request to fly under Parts 135 and 380 allows carriers like SkyWest and JSX to hire pilots as first officers with 500 hours of flight time, significantly below the 1,500-hour rule but still higher than the hours required for non-U.S. carriers. Moreover, they gain those hours alongside experienced captains in the left seat rather than doing touch-and-go’s at the local airfield on their days off.
The result: more knowledgeable pilots, more relevantly trained, more quickly available to bigger airlines, and an opportunity to put a dent in a pilot shortage that has already cost dozens of communities regularly scheduled air service.
In DOT filings, the anti- forces claim that SkyWest (and by extension JSX) should not be allowed to sidestep the 1,500-hour requirement for safety reasons. They warn that airport security and the environment will be compromised in dire ways. They further worry that competition from these small carriers will tear asunder the very fabric of the airline industry (an ironic argument in an industry where four carriers control two-thirds of the market).
JSX’s CEO answered these concerns in a fiery memo that you can read here. SkyWest has weighed in. The Air Line Pilots Association has fired back. Pundits have added to the debate, as has the Regional Airline Association and communities supportive of the service. The filings in the DOT-OST-2022/0071 docket have been strident, even by airline standards.
We are not tempted to dissect each argument. That’s for the lawyers and government relations units of the various parties to this action. From 30,000 feet, it boils down to this: Someone, somewhere, sees a potential threat to either their market dominance, pricing power, union influence, or all of the above. If that threat isn’t all that big a deal today, it might be at some time in the future, so it’s best to nip it in the bud and preserve the competitive edge, or influence, now.
It’s the same old playbook at a time when innovative thinking ought to be encouraged or – at the very least – thoughtfully examined. This is the DOT’s purview, so we would encourage the DOT to ask some deeper questions and do some innovative thinking on its own. For example:
Are the security issues a red herring? If not, how can the DOT address them in ways that preserve consumer choice, service to more cities and allow innovation by operators?
Is the environmental concern real as it’s asserted? Or in reality, is one’s carbon footprint reduced via non-stop travel vs. being forced to make connections in out-of-the-way, congested hubs?
Is safety threatened, or is it enhanced through a structured, managed pilot training program that can create a larger pipeline of commercial pilots mentored by the most experienced captains in the world?
Perhaps most importantly for an agency that has been more vigorously advocating for consumers: How much value is there in an approach that can benefit consumers by reopening flights to abandoned markets and to new ones? Do we stick with the same arguments and approaches that have guided these decisions for decades? Or do we find ways to give consumers a choice?
Brad Beakley is president and CEO of Dallas-based Hospitio Consulting & Services and Current Aviation, Inc. Reach Brad at info@hospitio.com