United plan puts regional carriers on edge By Marilyn Adams, USA TODAY United Airlines' effort to pay regional carriers less to feed passengers to= =20 its flights could ripple across the industry, paring regionals' fat profit= =20 margins."The heyday for these regional carriers is over," says Denver-based= =20 aviation consultant Michael Boyd, who has advised regionals. "These small=20 carriers have had great contracts. But United has made it clear it wants to= =20 squeeze them." In Chapter 11 bankruptcy protection, United wants to save=20 more than $100 million a year on contracts with three regional-airline=20 partners: Atlantic Coast, Air Wisconsin and SkyWest, all of which depend=20 heavily on United Express flying. Together, the three carriers operate=20 about 1,600 daily flights to 150 destinations. Whatever discounts United=20 extracts in reorganization are likely to be sought by United's big airline= =20 competitors with their regional-airline partners. In bankruptcy court=20 Monday, Virginia-based Atlantic Coast Airlines (ACA) asked the judge to set= =20 a deadline for United to reveal its plans for ACA, which has ordered=20 millions of dollars in regional jets to fly United Express flights. United= =20 =97 which is still sorting out how much flying will be done by regionals,= the=20 main airline and a proposed low-fare unit =97 challenged ACA's need to know.= =20 Judge Eugene Wedoff denied ACA's motion. Air Wisconsin has a similar court date next month. About 85% of ACA's=20 business comes from United. In 2002, Atlantic Coast had net income of $39.3= =20 million, up 14.5% from 2001, as revenue jumped 30%. So sensitive is the=20 case that one party to Monday's hearing, a Canadian agency that finances=20 the Canadian-built planes Atlantic Coast ordered, asked that the hearing be= =20 closed to keep prices secret. United wants to shift more flying to=20 efficient smaller regional jets but pay regionals less per flight.=20 Typically, major airlines have paid regionals a set fee per departure=20 regardless of how full the flight is or what fares were paid. As a result,= =20 regional airlines have remained profitable, while major airlines are=20 posting huge losses. United wants to cut the typical fee of up to $3,571 it= =20 now pays for each regional jet departure and says competing bidders would=20 do the flying for 23% to 28% less. United hasn't named the competitors, but= =20 analysts say they could be Mesa, Mesaba or Chautauqua airlines. "We've made no secret that United Express rates were negotiated in a=20 different time," United executive Doug Hacker said in a recent interview.=20 Only Utah-based SkyWest hasn't gone to court. It's watching. "We're=20 trusting United will start talks with us soon," spokesman Phil Gee says. *************************************************** The owner of Roger's Trinbago Site/TnTisland.com Roj (Roger James) escape email mailto:ejames@escape.ca Trinbago site: www.tntisland.com Carib Brass Ctn site www.tntisland.com/caribbeanbrassconnection/ Steel Expressions www.mts.net/~ejames/se/ Site of the Week: http://www.dbombo.net/muddyangels/ TnT Webdirectory: http://search.co.tt *********************************************************