MESAAIR GROUP: 3753 Howard Hughes Parkway, Suite 200, Las Vegas, Nevada 89109, United States; Phone (702) 892-3773; Fax (702) 892-3950; Http://www. mesa-air. com; Code YV; Year Founded 1994. In December 1994, the corporate organization of Mesa Airlines is changed and headquarters are transferred from Farmington, New Mexico, to Las Vegas, Nevada. Mesa becomes Mesa Air Group, with five operating divisions: Air Midwest, Florida Gulf, Liberty Express, and WestAir Commuter Airlines Mountain West Airlines (4), which replaces the original Mesa Airlines with components from it and several other units; along with.
Also in December, a $160-million order is placed for four additional Beech 1900Ds.
For the year as a whole as both Mesa Airlines and briefly, as Mesa Air Group, collective passenger boardings accelerate 16.2% to 5,170,252 and revenues jump 12% to $396.13 million. With expenses of $347.76 million, the pretax profit is up to $48.37 million and net gain reaches $27.68 million.
An arrangement is reached with United Airlines during the first quarter of 1995 to continue “United Express” service from Denver. As part of the deal, 12 DHC-8-300s are traded back to Bombardier Aerospace in April for 25 smaller, but hot-and-high DHC-8-200s that are more suited to the thinner Colorado air. A $226-million order is placed for the turboprops and, upon their arrival, beginning next February, they will be operated by Mountain West Airlines. Also in April, the Columbus hub is closed.
Established at Phoenix as a new MAG division, Desert Sun Airlines (2), under the direction of its President George Lippemeier, is equipped in April with a pair of Fokker 70 jetliners, the first to be flown by a North American carrier.
It is reported on May 25 that MAG has entered into discussions with Continental Airlines for the purchase of its “Continental Express” subsidiary. Under terms of negotiation, Mesa would take over the major’s commuter in exchange for a 33% investment in MAG by Continental. The premier Fokker 70 is delivered during the month and is initially employed on crew and route familiarization flights.
Mesa rejects the $90 million proposal on June 2. As part of a codesharing agreement with America West Airlines, the first Desert Sun Airlines (2) Fokker 70 begins “America West Express” service from its base to Des Moines on June 12. When the other Fokker becomes available in July, more destinations will be visited.
On July 1, MAG President/CEO Clark Stevens is elected to the board of directors, expanding the governing body back to its original seven positions.
Competition is heavy during the summer on both the West Coast and the East Coast and the Columbus “America West Express” hub is closed. A freak snowstorm hits Denver on the evening of October 22. After landing on Runway 34 in the blizzard, a DHC-8-200 mistakenly exits onto the wrong taxiway and becomes stuck in deep snow. ATC controllers are forced to close the whole runway for 20 minutes until the plane can be retrieved.
During November, support is provided to the new U. K.-based regional Community Express Airlines, Ltd. MAG as a whole is now rated a “National” airline by the DOT at year’s end.
Combined enplanements for the six divisions increase by 16% to 6,271,418, while operating income rises 14.7% to $454.53 million. Costs climb 22.2% to $424.96 million. Profits decline, with operating gain down to $29.57 million and net gain off to $14.01 million.
Overall employment stands at 4,100 in 1996. Early in the year, plans are made to return the two Dutch-made Fokker 70s operated by Desert Sun Airlines (2) and replace them with up to eight Canadair CRJs. Delivery delays on a number of DHC-8-200s and negotiations with pilots over a new contract are protracted.
While landing at Denver on May 2 after a flight from Gunnison, Colorado, “United Express” Flight 7591, a Beech 1900D with two crew and nine passengers, sustains substantial damage when the right main landing gear collapses; no injuries are reported. The group’s 100th Beech 1900D turboprop is delivered during the month.
As is the case with Rich International Airlines, the FAA, in the wake of the May Valujet Airlines disaster, raises questions concerning the company’s management structure, as well as safety, security, and maintenance operations. Following a number of hotline complaints concerning poor maintenance and flight delays, particularly at Denver, the FAA begins a “special emphasis” inspection, involving the company’s five divisions.
At the same time, Colorado’s U. S. Senator Ben Nighthorse Campbell (R-Colo.) asks for a Senate aviation subcommittee investigation as the result of continuing complains received in his office concerning flight delays at Denver and elsewhere.
In July, Congress eliminates $1.2 million in Essential Air Service (EAS) payments to MAG. As a result, the carrier is forced to halt Air Midwest “USAir Express” services to the Kansas cities of Dodge City, Great Bend, Garden City, and Hays served from Kansas City, plus a number of “United Express” communities visited by Mountain West
Airlines from Denver. Mesa’s other resources are strained by a delay in the company’s receipt of new Dash 8-200 turboprops and the resignation, over the past 60 days, of 38 pilots.
During the third week of August, a $320-million order is placed with Bombardier for 16 Canadair CRJ-200ER Regional Jets; it also takes options for 32 more in 2 groups of 16 each.
On September 22, MAG reaches a settlement with the FAA to resolve a number of deficiencies that inspectors have found in the airline’s operations and maintenance. The holding company, on behalf of its regional subsidiaries, agrees to pay a $500,000 civil consent penalty, make changes in its training and internal audit programs, and make personnel changes in flight, maintenance, and ground crews. The government agrees to set aside half of the penalty if compliance is demonstrated within a year.
The company, clearly annoyed, releases full details of the accord because the deal has leaked to the media by an unknown source within the FAA. At the same time, a “continuing fitness review” of the group is launched by the DOT. The company is reincorporated in Nevada on September 27.
Having been launched, Senator Campbell’s aviation subcommittee review now becomes a very public campaign designed to highlight the company’s poor service within the lawmaker’s state. MAG responds with public relations, town meetings, and back-up crews ready to make certain that delays are no longer a significant concern.
In October, former executive Jonathan Ornstein, currently CEO of Richard Branson’s Virgin Express Airlines, S. A., makes a $50-million offer on behalf of Virgin to purchase the company’s “United Express” division. The tender is rejected by Mesa’s board. At the same time, talks with the company’s pilots break down, bringing in the National Mediation Board (NMB).
Also during the month, discussions begin concerning a possible transfer of corporate headquarters from Farmington, New Mexico, to any of five new sites: Albuquerque, Dallas/Fort Worth, Denver, Memphis, or St. Louis.
Plans are announced for the launch of scheduled service from Fort Worth’s Meacham Airport next spring. At the same time, Texas proposes a new aviation tax on airlines operating within its borders.
Under NMB supervision, the company and its 1,000 unionized pilots are able to reach an accord on November 13 concerning a new 5-year pact. The agreement gives the flyers an immediate pay increase and an integrated seniority list; the carrier gets productivity concessions.
The decision is taken on December 9 to retain corporate headquarters at Farmington. With all of the Model Ds in service, the last of the Beech 1900Cs are retired by the end of the year.
Customer bookings accelerate 2.3% to 6,413,907 and revenues climb 9.9% to $500.36 million. Expenses are up only 6.3% to $452.37 million and there is a $47.99-million operating gain. The net profit more than doubles to $30.4 million.
During the first week of January 1997, MAG is again reorganized. The decision is based upon the FAA’s requirement that it integrate its independent airlines, giving the new units common manuals and procedures, as the necessary step to advance from a FAR Part 135 operator to a full-fledged Part 121 carrier.
The operating subsidiaries Desert Sun, Florida Gulf, Liberty Express, and Mountain West are replaced under the new certificate by four new divisions: “America West Express,” Independent, “United Express,” and “USAirways Express.” Also merged into the new divisions are the marketing and customer service departments of Air Midwest and WestAir Commuter Airlines, the FAA certificates of which are also both held by MAG.
Each of the new divisions will handle their own customer services, marketing, community relations, code-sharing arrangements, and government relations. MAG will remain as a holding company and centralized purchasing agency. The carrier begins to encounter substantial training backlogs as the shift to FAR 121 begins.
A new Independent Division, which retains the original Mesa Airlines name under President Peter Otradovec at Fort Worth, will provide jet services with a fleet of 10 Canadair CRJ-200ERs, the first of which arrives in February. Six additional RJs are delivered, several as replacements for the two Fokker 70s flying with America West Express.
Training flights commence in March. The cost of the company’s reorganization is seen in fiscal figures for the first quarter. As of March 31, the company has lost nearly $1 million since January.
At the beginning of April, 11 daily roundtrips commence between Fort Worth’s Meacham International Airport (“Meacham Field”), which hasn’t had scheduled service in a decade, and Houston. An FAA inspection forces the company to stand down from the new route in mid-month because Canadair pilots are not able to demonstrate appropriate skill in programming their sophisticated flight management computers. The grounding forces the company to postpone plans to start services to San Antonio on June 1.
Once new training is completed and procedures are revised, Mesa is allowed on May 5 to resume its 11-times-a-day frequencies between the Texas cities with 2 new RJ200ERs. A third Canadair is also on hand, but held in “ready reserve.”
The initial America West Express RJ200ERs arrive in late June painted in the new color scheme of America West Airlines with “America West Express” billboard-sized titles painted along their sides. They commence revenue services on July 7 from Phoenix to Des Moines, replacing the Fokker 70s.
Recognizing the higher costs of operating at the new Denver airport, Congress, under the leadership of U. S. Senator Pat Roberts (R-Kans.), restores—and increases—the lost EAS monies on July 1 for the next fiscal year, in the amount of $2,797,280.
A dispute between MAG and its United Express (Mesa Air Group) division vs. United Airlines and SkyWest Airlines concerning access to certain West Coast markets results in a July lawsuit. UAL files suit in the U. S. District Court in Chicago seeking a determination as to the rights of all parties to the routes before any of the companies suffer economically. Mesa does not countersue.
When the jetliner service between Fort Worth and Houston (HOU) proves less popular than anticipated, President Otradovec implements a fare sale; between August 1 and August 31, the $84 one-way tariff is reduced to just $25. Still, frequencies will have to be cut back to six per day. It is announced on August 23 that thrice-daily Canadair CRJ roundtrips will commence on October 5 between San Antonio and Colorado Springs.
On September 1, CRJ-200ER flights commence to San Antonio from Fort Worth 6 times daily; on September 7, service to Houston is reduced from 11 to 6 daily roundtrips. Due to a clause in its Meacham Field contract, Mesa is prohibited from flying from that market to cities outside ofTexas.
During the month and after a new inspection is completed, the FAA forgives half of the $500,000 fine imposed upon the airline a year earlier.
Due to a delay in receipt of FAA approval for its Beech 1900D simulator training program, Mesa, during the month, is forced to lay off 81 pilots who have graduated from its ground school. With the company suffering fiscal reversal, it can no longer justify maintaining the flyers on the payroll until such time as they can clear their final training and become active flight crews.
With the EAS subsidy coming in hand, twice-daily Air Midwest “USAir Express” roundtrip Beech 1900D flights are resumed on October 1 from Hays to Kansas City via Great Bend and from Garden City to Kansas City via Dodge City. Additionally, “United Express” resumes twice-daily Beech 1900D roundtrips from Great Bend to Denver via Dodge City and twice-daily roundtrips from Hays to Denver, plus thrice-daily roundtrips from Liberal to Denver via Garden City.
CCAir board member Peter Murname, a principal in Barlow Partners and former Mesa executive Jonathan Ornstein, president of Virgin Express Airlines, S. A., make a $50-million offer in October for Mesa’s “United Express” operation at Denver, along with WestAir Commuter Airlines. The tender is rejected.
“United Express” service from Denver to Fort Collins, Loveland, and Longmont, Colorado, is terminated as the result of low prorates from United Airlines, lack of capacity, and high Denver airport costs. United begins an Airport Express bus service that operates 14-times-per-day roundtrips from Denver to Fort Collins and 12 times per day to and from Longmont and Loveland.
A third Canadair enters service in November, with a fourth retained as backup. Five more CRJ-200ERs will enter service by year’s end. Mesa initiates thrice-daily nonstop Canadair CRJ-200ER roundtrip service between Nashville and Colorado Springs beginning Nov. 3 with introductory fares at $99 one-way. Flights previously scheduled to begin on October 5 are now initiated thrice daily between San Antonio and Colorado Springs.
On November 10, MAG places $350 million in orders with Bombardier Regional Aircraft for an additional 16 CRJ-200ERs; in fact, the request actually represents the conversion of 8 DHC-8 requests and the exercise of 8 options. Four will be assigned to Mesa Airlines and 12, under a new marketing agreement, to USAirways Express (Mesa).
Fort Worth to Austin CRJ-200ER service begins on November 30. Seven roundtrips are provided daily during the week with an abbreviated scheduled on weekends. Having weathered the required three-month interim, the company drops “United Express” flights to Worland and Rock Springs, Wyoming, plus Pueblo and Alamosa, Colorado, at the end of the year. More worrisome, completion reliability of America West Express (Mesa Air Group) falls to 95% in December, three points below the minimum specified by contract.
Passenger boardings increase by 5.4% to 6,759,756. Operating revenues rise 2.1% to $510.97 million, as expenses jump 25% to $565.46 million. The record operating profit of 1996 becomes a $54.48-million loss, another record; simultaneously, the record $30.4-million net profit has been turned into a record $48.59-million loss. In short, Mesa has undergone a “riches-to-rags” experience.
At the beginning of 1998, MAG is the 12th largest airline in the world in terms of fleet size.
Chairman Risley announces in late January that he will retire on April 30 or upon appointment of his successor, although he will continue to serve as the carrier’s nonexecutive board chairman. At the same time, company veteran Robert Dynan is appointed president of the independent Mesa Airlines Division and J. Clark Stevens becomes chief operating officer.
By January 14, a Washington, D. C.-based group led by Franklin Resources has gained a 9% stake in Mesa. Since December 2, it has purchased 2.54 million common shares. On January 22, it is revealed that Virgin Express Airlines, S. A. CEO Ornstein has acquired a 5.33% stake-sufficient for a board seat.
The worst news of the month comes from United Airlines, which announces an end to its “United Express” arrangements with subsidiary Westair Commuter Airlines. The San Francisco component is cancelled, effective on May 31, with Pacific Northwest flights to end in September.
The loss of this operation is a serious blow, as the “United Express” relationship had been worth 47% of the group’s revenue. Irate investors, claiming to have lost millions over the past year due to poor management, threaten lawsuits.
On February 4, the board of directors announces that Paul R. Madden, the airline’s corporate/SEC counsel from 1988 to June 1997, has been elected board chairman, with James Swigart as vice chairman. The chairman position was vacated the previous day by Mr. Risley, who becomes chairman emeritus.
To help revitalize their carrier, pilots at Westair Commuter Airlines offer MAG $20 million in February for a 20% stake; MAG spurns the tender. Also during the month, former executives Jonathan Ornstein and James Swigart, the latter chief financial officer of Virgin Express Airlines, S. A., of which Ornstein is CEO, return to the carrier, winning seats on the board of directors, and begin demanding management change.
Disappointed with the service it has received from Mesa (particularly completion reliability), America West Airlines determines during early March to conclude its code-sharing agreement with America West Express (Mesa Air Group), effective April 2 and notifies MAG of its decision.
Also in March, Westair Commuter Airlines President Rolly Berge-son memos company employees the bad news that 1,100 of their number will be laid off by mid-June, directly as a result of the loss of the United contract.
During the month, the Canadair service to Meacham Field, which is losing $2 million per month, is suspended, as are flights to Nashville and San Antonio from Colorado Springs. Plans are made to return up to 60 Beech 1900Ds and BAe Jetstream 31s to their lessors over the next 12 months.
On March 12, it is announced that five Canadairs will be transferred from the carrier’s Fort Worth system to satisfy the MAG agreement with USAirways, which calls for the placement of 12 regional jets into the USAirways Express code-sharing program.
On March 26, Virgin Express Airlines, S. A. CEO Ornstein is appointed CEO, effective May 1. When America West Airlines learns that the former Mesa executive vice president and current Virgin Express CEO Ornstein has become involved with Mesa on a management basis, AWA relents on its contract termination decision, agreeing to rescind the termination notice. On March 31, it enters into an interim dualdesignator pact. A long-term code-sharing alliance will be negotiated after Ornstein takes over as Mesa’s CEO in May.
The Pacific Northwest “United Express” segment is essentially completed on April 30 and with it United Express (Mesa Air Group) is no more.
Having initially indicated a preference not to assume an active role in management, Jonathan Ornstein becomes Mesa CEO on May 1. He will remain chairman of Virgin Express Airlines, S. A., where the Mesa board’s vice chairman, James Swigart, now becomes CEO. Chief financial officer from 1985-1995, Blaine Jones now returns to that post. Three Canadair CRJs enter service with USAirways Express (Mesa Air Group) on May 1.
Four Beech 1900Ds are transferred to Great Lakes Aviation during the month as the Spencer, Iowa-based carrier begins its expansion at Denver. Mesa and the aircraft’s manufacturer, Raytheon Aircraft, will turn over an additional 11 1900Ds following their maintenance-acceptance inspection.
At the beginning of May, MAG retains the International Airline Support Group to assist Westair Commuter Airlines with the disposition of its leased fleet of Brasilias and Jetstream 31s. The process will result in a $16.5-million suit by aircraft lessor Jet Acceptance Corporation against the airline for J-31 lease payments that are not subject to cancellation as well as damages.
CEO Ornstein begins to restructure the group’s management team on May 12. Clark Stevens vacates the chief operating officer slot to become president of Mesa Airlines, Inc., which operates as the America West Express (Mesa Air Group), USAirways Express (Mesa Air Group), and independently as Mesa Airlines, succeeding the resigned Robert Dy-nan. Michael Ferverda becomes vice president-light operations, replacing Chuck Steeber, who once again becomes a line pilot. Vice PresidentPlanning and Pricing Benjamin Harrison resigns, as does Public Relations Director Sarah Pitcher.
Having determined that the government EAS subsidy is insufficient, MAG, on June 19, serves notice to the DOT that it will halt service to Alamogordo, Clovis, and Silver City, New Mexico, and Kingman and Prescott, Arizona, within 90 days.
The second quarter losses this year are $9.2 million, compared to $989,000 a year earlier. Among the $131.1 million in expenses is a $4-million loss taken with the cessation of jet service at Fort Worth and a $2.5-million reserve related to an anticipated closure of a shareholder class-action suit. A clearly disappointed Chairman Ornstein promises action to reverse the decline.
In July, Mesa is able to renegotiate its financial arrangements with Raytheon Aircraft Company for 15 Beech 1900s. Under terms of the pact, $5 million in cash is immediately generated and leases on the aircraft are reduced from $560,000 per month to $200,000. Mesa concurrently enters into a brokering agreement with Raytheon under which any of the Beech 1900s may be sold, with the airline receiving a portion of the profit. This arrangement marks the opening of a massive sell-off or redeployment of nearly 100 excess aircraft.
Former Chautauqua Airlines CEO Timothy Coon is appointed to the newly developed position of vice president of USAirways Express (Mesa Air Group) on July 17. Plans are made to sell the flight school at Farmington.
A new, six-year code-sharing agreement with America West Airlines is announced on July 23. Focusing initially on America West hub at Phoenix, the agreement contemplates adding regional operations in Las Vegas and Columbus, Ohio. Additionally, Mesa’s Beech 1900s will be withdrawn in favor of CRJs and DHC-8s, which will reach totals of 12 and 14, respectively, by the end of 1999.
The next day, at the company’s annual general meeting, shareholders reelect the board of directors, as restructured in early February, and approve all of management’s proposals. It also approves a transfer of company headquarters from Farmington to Phoenix.
Michael Suckow is named senior director of systems operations on August 6, while, at the same time, Steve Markhoff becomes director of corporate affairs. “America West Express” frequencies to Des Moines and Fresno are increased during August.
Given the history between the leadership of the two organizations, it does not come as a surprise when, on August 27, it is announced that MAG has signed a letter of intent for the acquisition of CCAir. The allstock transaction, valued at approximately $60 million (including $15 million in debt assumption), will be complete as soon as stockholders and government regulators approve.
Mesa will operate CCAir as a wholly owned subsidiary, which will retain its own name. Through their relationships with USAirways, the acquisition is also seen as a way for the combined “USAirways Express” companies to serve all of the major’s hubs on the East Coast.
Although the Jet Acceptance Corp. suit is still pending, MAG, on September 4, agrees to pay $8 million to settle several other pending lawsuits in order to prevent long legal battles. The suits had been filed earlier by disgruntled stockholders accusing present and former Mesa board and executive officials of allegedly and purposefully providing incorrect financial information.
A tentative contract is reached with Association of Flight Attendants (AFA) on September 21. Rank-and-file members will vote on the matter within weeks.
At the beginning of October, Vice President-Customer Service Mike Lewis is tasked to work closely with both the Mesa Airlines Division and “America West Express”; Vice President-Station Operations Heidi Frederick receives the same charge concerning “USAirways Express.”
The independent Mesa Airlines unit, operating Beech 1900Ds from the Albuquerque hub, visit the following communities Colorado Springs, Durango, Alamogordo, Albuquerque, Carlsbad, Farmington, Hobbs, Las Cruces, Roswell, Silver City, and Dallas/Fort Worth.
On October 4, CCAir starts nonstop “USAirways Express” DHC-8-102 roundtrips are between Charlotte and Tallahassee four times a day.
A public ceremony and news conference are held at Albuquerque on October 16 to unveil MAG’s new corporate identity. Designed to symbolize the new spirit of Mesa in the New Mexico marketplace as well the group’s rejuvenation, a new logo and corporate livery are unveiled aboard a Beech 1900D. The color scheme is changed from the predominant color of green to a more modern look of purple and yellow, accented by a reddish orange sun. “We’re a different company,” Chairman Ornstein assures the 100 community leaders and media on hand for the event.
Under terms of its new accord with America West Airlines, “America West Express” assigns four new CRJs to the major’s Columbus,
Ohio, hub in the fall. These are employed, beginning on October 29, to double frequencies to Baltimore and Philadelphia from two flights per day to four.
Additionally, a third daily flight is started to Boston and a fourth to New York (LG A). Frequencies to Chicago (MDW) are advanced to seven per day. A mix of CRJs and larger America West Airlines jetliners will operate the latter services.
Also in October, a tentative agreement, which will be ratified in November, is reached between the airline and the AFA. The labor pact, the first between the union and the airline, covers the flight attendants working with the company’s “USAirways Express” and “America West Express” divisions.
It is announced at a Phoenix news conference on November 25 that MAG has settled all claims with the aircraft and equipment lessors of its defunct WestAir subsidiary for approximately $15 million.
Enplanements for the year drop to 4.32 million, a 36% decline; revenues are off by 17.1% to $423.54 million. Although expenses are down 17.2%, they still total $468.32 million and cause an operating loss of $44.78 million. The net loss grows to $53.43 million.
In a move calculated to rebuild the strength and size enjoyed before the “United Express” disaster, MAG, on February 1, 1999, officially moves to fold CCAir into “USAirways Express,” with the $54-million merger to be complete by June. At that point, each CCAir share will have been exchanged for between 0.435 and 0.6214 Mesa share.
There are no initial plans to change CCAir’s operations or to link the carrier’s route system to that of MAG.
The carrier announces on February 25 that it has entered into a contract to sell an additional 16 Beech 1900Ds as part of its fleet restructuring project. Due to new regulatory requirements and the additional costs of maintenance, the aircraft have become too expensive to operate.
Upon completion of the transaction, the group fleet will comprise 22 CRJs, 12 DHC-8s, and 77 Beech 1900Ds. An additional 10 CRJs will be received by December 31.
Mesa CEO Ornstein and CCAir CEO Kenneth Gann jointly sign an extension of the “USAirways Express” service contract on March 5; the renewed marketing agreement is good through December 31, 2003.
The Mesa Airlines, Air Midwest, and CCAir divisions all complete 100% of their flights on May 2. To celebrate this achievement, Presi-dent/CEO Ornstein, on May 6, hosts a company-wide pizza party for all 3,800 employees in every unit spread over 100 locations.
Represented by the AFA, MAG’s flight attendants ratify their first contract, for four years, with the airline on June 13.
A dispute with Bombardier Aerospace over financing, trade-in, and option aircraft is settled in November for $9 million. The arrangement between the two calls for Mesa to pay the Canadian manufacturer $4 million immediately, with additional payments over eight months.
Also during November, the ALPA-represented pilots of Mesa Airlines and CCAir merge their seniority lists. Both carriers operate as USAir-ways Express (Mesa Air Group).
Mesa Airlines passenger boardings fall 17.5% this year to 2,795,000. MAG revenues drop 17.3% to $404,616,000, while expenses are down 26.8% to $405,862,000. Losses improve to $1.24 million (operating) and $13.32 million (net).
MAG employment at the beginning of 2000 stands at 4,000, a 60% increase over the previous 12 months. Among the world’s top 25 airlines, MAG now ranks 23rd in terms of its fleet size.
An agreement is signed with Empresa Brasileira de Aeronautica, S. A. on January 27 for 36 additional ERJ-145s; Mesa also has options on 64 more regional jetliners, some of which may later be converted into ERJ-135 orders.
The first ERJ-145 arrives and clears customs at Fort Lauderdale on April 28. In May, Larry Risley, founder/chairman emeritus, retires from the MAG board of directors. On June 4, the premier ERJ-145 enters service with USAirways Express (Mesa Air Group). (For consistency, Mesa’s “USAirways Express” operational service is filed under that listing.) The CRJs displaced by the new Brazilian jets will be transferred to America West Express (Mesa Air Group).
MAG is named fourth best-managed company among non-state-owned regional-sized airlines in the “2000 Index of Competitiveness” published by Aviation Week and Space Technology on July 10. Also in July, Michael Lotz becomes president.
On September 19, an agreement is reached with Raytheon Aircraft Company under which the manufacturer will accept return of 20 Beech 1900Ds. The arrangement is based on an August 1 offer from Raytheon under which the 36 remaining units would be refinanced.
An agreement between Chairman/CEO Ornstein and officials from Lea County and Hobbs, New Mexico, result in a company decision to rescind plans for closure of its nonsubsidized EAS route from Hobbs to Albuquerque on October 19.
The “USAirways Express” contract is extended on November 1 from 2007-2008. Mesa promises to grow the number of ERJ-145s committed to the pact from 28 to 32.
The next day, the Air Midwest “USAirways Express” subsidiary signs a code-sharing agreement with Midwest Express Airlines. The pact is scheduled to take effect early in 2001 on 14 routes out of Kansas City.
By mid-November, Mesa is operating 10 ERJ-145s for USAirways Express (Mesa Air Group) and 26 CRJs for USAirways Express (Mesa Air Group) and America West Express (Mesa Air Group). The total allows the airline to claim the title of largest independent U. S. regional jet operator.
During the first quarter of 2001, Mesa will execute a new agreement with United Airlines. Contingent upon the proposed merger of the major with USAirways, United will extend the MAG USAirways Express (Mesa Air Group) contract through December 3, 2010. The deal requires that both UAL and MAG drop all outstanding litigation remaining from the UAL termination of its contract with Mesa in 1998.
World History
