U.S. Regional airline restructuring Part I: Is consolidation inevitable – or essential?
Despite the massive upheaval in the U.S. regional airline industry in the past seven years, the segment remains at risk owing to one simple fact - too many airlines are chasing too few contracts. There are, after all, still 16 feeder airlines for only four major carriers.
In 2011, CAPA examined the regional airline industry in the wake of the Financial Crisis, concluding the regional model was broken. Now, four years later, we have a clearer vision of how the industry has changed and what lies ahead for a smaller, stronger industry.
But the model remains broken and, sadly, little can be done about it. Indeed, the issue is so sensitive that few are even willing to discuss the issue.
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