PAUL LEWIS / PHOENIX
The USA's Regional Airline Association has been accused of neglecting small turboprop carriers. And so Regional Aviation Partners was born.
Regional Aviation Partners (RAP) has been in existence for only 12 months, but already the Mesa Airlines-led organisation is laying claim to a number of lobbying successes - the most notable of which is a 45% hike in federal funding for the Essential Air Service (EAS) programme.
The Regional Airline Association (RAA) is also claiming that the extra $50 million was down to its endeavours. Whatever the truth, and it probably lies somewhere in the middle, it serves to focus attention on the fact the regional air transport industry can no longer speak or lobby with one voice at time when faced with a growing number of critical challenges.
Turboprop plight
Mesa Air Group chairman Jonathan Ornstein over the years has gained a reputation for candid speaking and in recent times the RAA has been the target for some of his more blistering attacks.
His chief complaint has been that, in the rush to embrace the regional jet phenomenon, the Washington DC-based organisation has completely ignored the plight of small turboprop carriers and the remote communities they serve. Ornstein finally parted company with the RAA in April last year and launched RAP with Mesa director Maurice Parker at the helm.
"Maurice has done a truly outstanding job with RAP," states Ornstein. "We gave him $200,000 seed money and with that he went and got 60 to 70 members. He started going to Washington DC, got the EAS budget doubled and put the whole issue of [Raytheon Beech] 1900s and the problems faced by small operators absolutely at the forefront of all these politicians. This is in sharp contrast to the RAA, which in my opinion has done zero in terms of smaller carriers and that's why we did this," he adds.
But RAA president Deborah McElroy disagrees. "That's incorrect," she says. "We lobbied very strongly last December to get increased funds and our members were there all over [Capitol] Hill. Our board of directors tells us what we need to be doing on behalf of the airlines. We represent 54 airlines that are providing the vast majority of small community air services. Maurice Parker works for just one and so it's a little different," she adds.
RAP boasts few airlines among its membership other than Mesa subsidiaries, such as Air Midwest or CCAir, and a handful of small independents. The association instead has sought to broaden its partnership to encompass more of a "grassroot" aviation constituency. RAP as of mid-April had around 25 regional airports signed up, along with several commerce chambers, at least two state aviation departments, as well as Bombardier Aerospace Regional Aircraft and Raytheon - both large Mesa suppliers.
No-one other than Mesa has yet had to pay any membership fees, but it has already seen a healthy return on its investment in the form of $3.5 million in additional subsidies from the EAS programme. The company still has 45 1900Ds flying either for US Airways Express, America West Express or under Mesa's own name, even after returning some 15 aircraft to Raytheon, and it relies heavily on EAS to keep these aircraft profitably employed. Ornstein, furthermore, is intent on expanding his share of the programme and by mid-April had submitted bids for another 15 EAS routes.
Backing the RAA
Three regionals in mainland USA now rely on EAS to subsidise more than half their services but only one - Great Lakes Aviation - has so far joined RAP. "I don't see where they can help us more than RAA," says Kim Champney, Big Sky Airlines chief executive. "I don't see any benefit they have that the RAA does not afford," echoes Chuck Howell, Corporate Airlines chief executive. Instead, he applauds the RAA for representing the interest of small carriers on the numerous issues that popped up after 11 September, such as lobbying against extending new cockpit door requirements to 19-seaters.
Regulations governing the operation of small commuter turboprops have been a bone of contention for Mesa ever since 1997 and the switch from Part 135 operating rules to the much more demanding and costly Part 121. "The RAA was one of the main contributors to the problems of the 1900s by having supported the 121 transition which has crushed everyone. The training expense for Mesa alone is in tens of millions of dollars," complains Ornstein.
RAP accordingly has made it a priority is to seek Part 121 exemptions for 10- to 19-seat aircraft. In RAA's defence, McElroy suggests that the transition only became an issue for Ornstein after he joined Mesa in 1998, and that while he was at Continental Express he did not oppose it. Asked whether the RAA intends to support any amendment to Part 121 or even a return to Part 135, she replies: "If they file for that, I'll go to my board and go to the members, the 19-seat operators, and ask: 'what do you want the RAA to do?' and we'll make a decision then."
RAP and RAA are both in accord on the need to reform EAS, which has changed little since it was first introduced in 1978 at the time of domestic US deregulation. Both McElroy and Parker believe there needs to be continuity in the amount of Department of Transport (DoT) funding appropriated in order to ensure service stability, as well as reforming how communities are assessed and the subsidies administered. "We're undertaking a nationwide survey of every airport in the USA asking if the programme needs to change, and if so, how and whether carriers or communities get the money. We've sent out 540 surveys and based on the responses so far, the consensus is for change," reveals Parker.
Industry wants at least the same amount of EAS funding in fiscal year 2003 as the $113 million appropriated this year. A separate pilot programme that was initiated two years ago, but which was only funded starting this year to the tune of $20 million, is the small community air service development scheme. The roughly 40 EAS and non-EAS communities that are eligible to apply are given greater flexibility on how the money is spent, be it for marketing a destination, encouraging multiple carrier competition or simply lowering air fares. RAA and RAP are lobbying for $27 million more in FY03.
Post-11 September there has been a drop in the number of small community services as major regional carriers have accelerated the retirement of small turboprops in favour of jets which in many cases are unsuitable for smaller, shorter-range destinations. Where an airline has served notice that it will quit a service and the DoT has denied EAS money on the grounds a community was not 70 'highway miles' or more from a major airport, or that subsidies would exceed its $200 per passenger cap on routes under 210 miles for example, the RAP has been busy filing objections.
The RAA, furthermore, sees regional services coming under renewed pressure from airport capacity as mainline traffic recovers. The DoT is again looking at implementing market-based demand management for controlling congestion at airports starting with New York's La Guardia, which could price regional services out of prime slots. "We're very concerned about measures that could limit the ability of regional airlines to provide service between small and medium-size communities and large hubs. La Guardia is the poster child for this," says McElroy.
Another major threat to US regional turboprops from an unexpected quarter are scope clause agreements, which have traditionally been used by the pilot's union to restrict the number and size of regional jets. Cuts in mainline services and the furloughing of pilots is forcing cuts at a regional level in order to remain in compliance with scope agreements. In the case of American Eagle, the axe is falling on turboprops, with aircraft being grounded, seats removed from other aircraft and services eliminated to make capacity available for new regional jets such as the 70-seat Bombardier CRJ700.
Implications
Both the RAA and RAP are starting to raise the issue at a political level, educating Congressmen on the implications of scope for local air services in their communities. "I think, long-term, scope is a loser for the pilots because when you deny service you're denying people the opportunity to grow their companies. It's gone from protecting jobs to being anti-competitive and if most people in the US understood this they would be totally appalled. We need to get out there and explain this and let the pressure build," says Parker, a former airline labour national mediator.
Despite the finger pointing, it would appear there is more than enough common ground for the RAA and RAP to share and that, given the make-up of their respective memberships, the two bodies could be complementary rather mutually exclusive. There is little sign, however, of any accommodation on either side. "I don't think that is an immediate plan," says Parker. While McElroy would not rule out working with RAP, she says: "We're recognised by the White House and the Hill as representing the industry and we're doing our stuff."
Source: Flight International
