SkyWest Airlines plans to use the proceeds of its recent secondary public offering to firm up orders for another 40 Bombardier CRJ200s - but only if it can secure regional jet (RJ) scope clause concessions via United Airlines' tentative labour agreement with its pilots union.

Utah-based SkyWest raised $117 million capital from the 25 August offering to expand its western US regional operation. Bombardier wants the airline to confirm its order for 40 extra CRJs six months ahead of the first delivery, set for September next year, says SkyWest chief operating officer Ron Reber, "otherwise we move to the back end of the queue."

The offering placed 2.6 million new shares on the NASDAQ exchange, representing 9.5% of the airline's stock. It increases SkyWest's total shares to 26.35 million and bolsters its capitalisation to $1.2 billion. Underwriters Raymon James & Associates have the option to purchase an additional 400,000 shares to cover over-allotments.

SkyWest operates 11 CRJ200s, with 54 on firm order for delivery by 2002, of which 20 will be used to expand its United Express feeder operation out of Denver. SkyWest holds 10 of the 65 RJ positions United is allowed under current scope limits, but needs many more. "We're hoping for another 50," says Reber.

The rest of SkyWest's CRJ200 fleet is being used on Delta Connection services from Salt Lake City. The additional jets will allow it to cut its Embraer EMB-120 Brasilia fleet from 92 aircraft to 50 by 2005. Fellow United Express carrier Atlantic Coast Airlines is in a similar position, with conditional orders for 30 CRJ200s and 15 Fairchild 328JETS dependent on a revised scope clause agreement. A third carrier, Air Wisconsin, is also pushing to grow its fleet.

United and the Airline Pilots Association (ALPA), representing its 10,000 mainline pilots, remain tight lipped about a yet-to-be-ratified deal hammered out afterweeks of industrial action (Flight International, 15-21 August). United wants 284 additional RJs of 50-seats or below, whereas ALPA is thought to have agreed to an immediate increase of 150-175, tied to growth in the mainline narrowbody and widebody fleets. In return, United's pilots are reported to have won a 22.5-28.5% wage increase, depending on aircraft flown, news of which further depressed the carrier's stock price.

Source: Flight International