Mesa Air Group looks to a new landscape: Europe: Travel Weekly

Mesa Air Group, which operates regional jet routes under the United Express and American Eagle brands, plans to become the first US regional airline group to operate in Europe.

The Phoenix-based company has entered into a joint venture with London-based consultancy Gramercy Associates, with the aim of replicating its American business model on the continent.

Gramercy is led by Tony Davis, former CEO of Singapore-based low-cost airline Tiger Airways, which merged with Singapore Airlines group low-cost brand Scott in 2017.

The new joint venture plans to apply for an EU Air Operator Certificate using Bombardier CRJ-900 aircraft, which have a standard 90-seat configuration.

In the United States, major carriers Delta, United, and American contract with regional airlines such as Mesa and SkyWest to operate regional flights. The arrangement provides flexibility to major carriers, as well as cost savings.

The model also exists in Europe, although it is not as widespread, said John Strickland, director of London-based JLS Consulting. One example is Air Nostrum, which operates Iberia’s regional network under the Iberia Regional Air Nostrum brand. Another example is CityJet, based in Dublin, which operates CRJ-900 routes for Scandinavian Airlines (SAS).

In fact, these two carriers were working on a merger before the Covid-19 pandemic torpedoed the plan.

Strickland said the regional airline market is more difficult in Europe than in the United States due to stiff competition from low-cost airlines such as Ryanair and EasyJet; efficient high-speed rail alternatives to short-haul flights; and higher taxation of air transport.

But he said that by turning to Europe, Mesa could try to capitalize on the commensurate increase in airlines’ needs for small planes due to the decrease in the number of travelers.

“If demand declines for a long time, and if the 737s and the A320 Family prove to be too big, this is where Mesa can see an opportunity,” Strickland said.

In support of this thesis are recent comments from Warner Rootlieb, Managing Director of KLM’s regional branch, KLM Cityhopper, at Aviation week. Rootlieb said that KLM’s balance between regional jets and the Boeing 737 may shift slightly to more regional jets over the next two years as the regional fleet will take over some major routes from KLM.

“We are very excited to expand our regional business overseas,” said Jonathan Ornstein, CEO of Mesa.

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