REBECCA RAYKO / FLORIDA
Comair resumed scheduled services on 2 July with flights to 26 cities from Cincinnati, but the effects of the 89-day pilot strike will be felt for a long time to come, say analysts.
The five-year contract, ratified by Comair pilots, provides an average 23-31% pay increase, plus considerable improvement in the benefits package. The deal sets pay and benefits precedents that other regional labour groups will look to as a new benchmark.
"There's no doubt this becomes the new high-water mark for regional jet labour rates," says Doug Abbey, an airline analyst with AvStat Associates in Washington.
Abbey and other analysts say the airline industry can expect to see continued acceleration of regional jet pay rates. "It's safe to say the Comair results will be incorporated into any labour discussions from now on," Abbey says.
Executives at other major US carriers have watched the Comair developments with dismay. Several have publicly expressed concern over the impact that higher regional labour costs will have on the industry. American Airlines chairman Don Carty said last month the situation caused him to re-evaluate his airline's mix of owned and non-owned regional partners.
Carty said the Comair labour dispute influenced his decision not to buy the carriers in the three regional TWA system when American completes its purchase of that airline. "There are some great advantages," Carty said of AMR's regional partnerships, "but labour problems will determine their value in the future."
United Airlines' James Goodwin has expressed similar concern. "If the regional jet cost structure changes, it will impact this industry dramatically," he said at a New York transportation conference last month. Goodwin said he would rather invest more heavily in the mainline carrier than in United's regional partners.
"After watching the Comair situation, I believe we made the right choice," Goodwin said.
Major airlines will also look to become less dependent on their regional partners as a result of the Comair strike, says George Hamlin of Global Aviation Associates. "Delta in particular will try to spread the risk among its other regionals, and the likelihood that it will grow Comair in the future is small," Hamlin says.
Source: Flight International
