Mesa Air Group
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Company type | Public |
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Nasdaq: MESA Russell 2000 Index component | |
Industry | Aviation |
Founded | 1980 |
Headquarters | Phoenix, Arizona, United States |
Key people |
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Revenue | $1.4 billion USD (2007) |
Number of employees | ~3,600 (2022) |
Website | www.mesa-air.com |
Mesa Air Group, Inc. is a
Mesa was founded on a mesa in Farmington, New Mexico in 1982 by Larry and Janie Risley, a husband and wife team that mortgaged their home to finance their dream to own an airline. Mesa moved its headquarters to Phoenix, Arizona in 1998.
As of June 2022, Mesa operated 167 aircraft, with more than 457 daily departures to 120 cities throughout the U.S., District of Columbia, Canada, Mexico, The Bahamas, and Cuba.[3]
Subsidiaries
Airlines
Former airlines and subsidiaries
- Air Midwest
- Freedom Airlines, Inc.
- CalPac (California Pacific)
- CCAir
- Desert Sun Airlines
- FloridaGulf Airlines
- go!
- Liberty Express Airlines
- Mountain West Airlines
- Skyway Airlines
- Superior Airlines
- WestAir Holdings, Inc. and WestAir Commuter Airlines
- Desert Turbine Services
- Four Corners Aviation
- Mesa Leasing, Inc.
- San Juan Pilot Training
History
Mesa began in 1980 when JB Aviation, a fixed-base operator at the
During its first few years, Mesa found itself in a very competitive environment. Six other carriers competed against Mesa:
In 1984, the Civil Aeronautics Board awarded Mesa its first Essential Air Service (EAS) contract, to serve Roswell, Hobbs, and Carlsbad, winning the contract from Air Midwest. A second round of EAS bidding resulted in Mesa winning contracts to serve Silver City, Alamogordo, Las Cruces, Clovis, and Gallup.
By late 1985, Mesa acquired its first Beechcraft 1900 turboprop and began the first scheduled air service to Telluride, CO, as that aircraft had the performance to serve the city's airport which sits at more than 9000 feet above sea level. Service was also added to high altitude Angel Fire, NM, a year later.
By 1987, Mesa had grown from six employees in 1982 to 187 employees; its fleet grew from a single Piper Saratoga in 1980 to one
Mesa continued to grow in 1987. It listed on Nasdaq: MESA with an initial public offering of 865,000 shares of stock at $7.50. While it was now operating to all the primary cities in New Mexico, it then expanded outside of the state by acquiring routes in Wyoming, Utah, and Colorado from Centennial Airlines as well as adding nonstop flights from Roswell, NM, to DFW. Mesa then acquired a pair of 9-seat Cessna Caravans to serve even smaller cities in New Mexico and established new routes from Albuquerque to Taos and Ruidoso.
To provide a pool of qualified pilots, Mesa established an ab-initio flight training program in 1989 with San Juan College, a local community college.
Acquisitions and mergers
Starting in 1989, Mesa embarked on a series of acquisitions and mergers over the next six years that would be known by the airline industry watchers as "Mesa's a deal a year growth".[This quote needs a citation]
In February 1989, Mesa negotiated its first codeshare agreement with
In February 1990, Mesa acquired
Mesa had many changes in 1991; acquiring
In 1992, Mesa completed acquisition of WestAir Commuter Airlines and its hubs in San Francisco, Los Angeles, Portland, and Seattle as well as its United codeshare. In October 1992, Mesa negotiated a codeshare agreement with
In 1993, Mesa's codeshare with Midwest Express expired. Midwest Express kept the name Skyway for its future regional of the same name. Using the aircraft from the former Skyway operation, Mesa established Superior Airlines with a Columbus hub operating as America West Express. Mesa created CalPac (California Pacific) with a Los Angeles hub operating as United Express. Both Superior and CalPac were short-lived operations, with both airlines being folded back into Mesa Airlines United Express operations.
In 1994, Mesa acquired Pittsburgh-based Crown Airways. Using the assets from Crown Airways, Mesa set up Liberty Express Airlines with a Pittsburgh hub operating as USAir Express.
In March 1995, Mesa took delivery of its first two regional jets, the Fokker 70, a smaller version of the Fokker 100 jetliner. Mesa created Desert Sun Airlines and operated the two jets from a Phoenix hub to Des Moines and Spokane as America West Express.
Reorganization
As Mesa acquired air carriers or expanded by creating new airlines, it grew in a seemingly haphazard manner. From 1989 through 1995, Mesa had grown from one airline with hubs in Albuquerque, Denver, and Phoenix to six separate airlines with hubs throughout the country, though it had as many as eight airlines prior to 1995.[6] Rather than integrating each new acquisition and airline into one integrated company, Mesa continued operating each individual airline independently, with separate labor groups, separate flight, maintenance, and marketing operations, and separate codeshare agreements. This resulted in an unwieldy corporate structure.
In 1992, Mesa created
- Air Midwest (Kansas City)
- Mesa Airlines
- America West Express (Phoenix)
- FloridaGulf Airlines (Tampa)
- Mesa Airlines (Albuquerque)
- United Express (Denver)
- Skyway Airlines (Milwaukee)
- WestAir Commuter Airlines (Los Angeles, San Francisco, Portland, and Seattle)
- San Juan Pilot Training (forerunner to Mesa Pilot Development)
- Desert Turbine Services
In 1995, Mesa Holdings Corp was renamed Mesa Air Group, and Mesa Airlines was renamed
- Air Midwest (Kansas City/USAir Express)
- Desert Sun Airlines(Phoenix/America West Express)
- FloridaGulf Airlines(Tampa, Orlando, New Orleans, Boston, Philadelphia/USAir Express)
- Liberty Express Airlines(Pittsburgh/USAir Express)
- Mountain West Airlines, operating as:
- Mesa Airlines (Albuquerque)
- United Express (Denver, Los Angeles (former CalPac), Portland, Seattle)
- America West Express (Phoenix)
- WestAir Commuter Airlines (Los Angeles, San Francisco, Portland, Seattle/United Express)
- Desert Turbine Services
- Four Corners Aviation
- Mesa Pilot Development
- Regional Aircraft Services
In 1996, further company reorganization consolidated the separate flight dispatch functions of Desert Sun, FloridaGulf, and Mountain West airlines into one location in
The six pilot groups had voted to unionize in 1994. In 1996, the pilot groups of the six airlines were merged into one common seniority list, and under the
When Mesa started taking deliveries of the CRJ in 1997, it returned to two Fokker 70 jets and placed the CRJs in service in Phoenix. Mesa started an independent hub providing CRJ service from
Mesa and United entered into discussions in July 1997 to renew WestAir's codeshare agreement, which was due to expire in May 1998. Mesa and United could not agree on new terms. As negotiations delayed into the summer, United started awarding WestAir's routes to SkyWest Airlines. Finally with negotiations at an impasse, United announced in November 1997 that it would not renew the codeshare with WestAir. Mesa attempted to reengage United and ask United to reconsider to no avail.
Mesa experienced many customer complaints regarding its Denver United Express operation. The level of complaints resulted in a Congressional inquiry of the airline's performance. Mesa experienced increased costs the Denver hub as a result of moving from Denver Stapleton airport to the new Denver International Airport and as a result of a decrease in the average fare Mesa received from United. In efforts to reduce its exposure to the high costs and mounting losses, Mesa announced that it would reduce and terminate service from its Denver hub in September 1997. United charged that the reduction and termination of service was a material breach of the codeshare agreement. Naturally Mesa disagreed. Again, as with WestAir, agreement could not be reached and United and Mesa mutually agreed to terminate the codeshare.
The effect of the codeshare termination with WestAir and Mesa was immediate. The termination put 87 (21 Jetstreams, 29 Brasilias, and 37 Beech 1900s) of Mesa's 184 aircraft out of service or 47% of its total aircraft. Mesa took immediate steps, parking the Jetstreams and Brasilias. It sold 10 Brasilias to Skywest. Mesa exercised the option to purchase 16 additional CRJs and traded in the remaining Brasilias to Bombardier for CRJs. Mesa sold 24 Beech 1900s to Great Lakes, and returned the remaining Beech 1900s to Beechcraft/Raytheon. WestAir ceased operations in 1998.
Mesa experienced difficulties with its other two codeshares as well. Flight crew shortages and scheduling problems resulted in the cancellation of many flights. From October 1997 to January 1998, Mesa parked aircraft and canceled flights to alleviate the crew shortage problem. Part of the crew shortage problem was related to the consolidation of flight operations in Farmington, and the training associated with transitioning the air carrier from a
Turnaround
In 1998, Jonathan Ornstein was appointed CEO of Mesa Air Group. Ornstein had been Risley's assistant from 1989 to 1995 during Mesa's initial expansion. Larry Risley remained on Mesa's board of directors. All corporate officers were replaced and the company headquarters was relocated from Farmington to Phoenix. The flight training and human resources departments were also moved to Phoenix. Its plan to return to profitability focused on several fronts: its aircraft, codeshares, and customer service.
One of Mesa's problems during the turnaround was its fleet of over 180 turboprops. It began consolidating all of its remaining Beechcraft 1900 turboprops into Air Midwest, completed in 2000. It embarked on a plan to reequip with jet aircraft. In 1999, Mesa arranged to purchase 36 Embraer 145 jets with options for 64 additional ERJs. In 2001, Mesa arranged to purchase 20 CRJ-700s and 20 CRJ-900s with options for 80 additional CRJ-700/900s. Five of the CRJ-700 orders were subsequently converted to CRJ-900s. As Mesa took delivery of the larger CRJ-700s and CRJ-900s, scope restrictions with US Airways prevented Mesa from operating the larger aircraft in its Mesa Airlines subsidiary. Mesa created a separate subsidiary, called Freedom Airlines to operate these aircraft. As the scope restriction at US Airways was removed during US Airways' bankruptcy reorganization and after Mesa settled with its pilot union regarding operating Freedom as a separate air carrier, Freedom's aircraft and pilots were merged back into Mesa Airlines in 2003.
As Mesa completed its restructuring, it proceeded to reestablish codeshares. In 1998, it negotiated a new codeshare with America West and expanded its existing one with USAir. In 2001, Mesa reestablished a codeshare agreement with
By 1999, Mesa returned to profitability. Mesa acquired CCAir and its USAir Express codeshare in 1999. It continued to operate CCAir as a separate operation. By 2002, CCAir ceased operations due to high costs and its assets and employees were absorbed into Mesa. The latest merger attempt was in 2003, when Mesa offered to acquire Atlantic Coast Airlines. Its offer was refused, and ACA went on to operate independently as Independence Air and later ceased operations in January, 2006. In 2006, Mesa began operating in Hawaii under the brand go! and established a codeshare agreement with Mokulele Airlines, where Mokulele will operate as a go! Express carrier.
In 2004, Mesa Air Group met with Hawaiian Airlines and Aloha Airlines, both in bankruptcy at the time, and reviewed operational records and forecasts, but ultimately decided not to acquire or invest in either carrier. In 2006, after Mesa announced plans for its "go!" sub-branded airline in Hawaii, Hawaiian Airlines sued to block the launch, claiming that Mesa had violated a confidentiality agreement.[8] Aloha Airlines filed a similar suit against Mesa later that year.[9]
In September 2007, the
Aloha Airlines ceased operations in March 2008,[13] and the Aloha Airlines suit was settled in November 2008. Mesa agreed to pay $2 million, 10% of Mesa's common stock, and provide travel benefits on go! for former Aloha employees.[14] Initially the settlement agreement included a provision whereby Mesa Air Group could license the Aloha name, but a federal judge rejected that agreement on the basis of Mesa's alleged misconduct in the Hawaii market.[15]
Mokulele acquisition
In October 2009, it was announced Mesa Air Group's subsidiary "go!" would be taking over all of the Hawaii flying done by
Bankruptcy filing
On January 5, 2010, Mesa Air Group filed for
Mokulele divestiture
In December 2011, it was announced Mesa Air Group had divested itself of Mokulele's Cessna Caravan aircraft and operations. In June 2012, Mesa began the process of dropping the "go! Mokulele" name and reverting to "go!".[19]
Labor groups
Mesa Air Group labor groups are represented by several labor organizations:
- Flight attendants are represented by the Association of Flight Attendants (AFA). Its contract became amendable in June 2006. Mesa and its flight attendants are currently in contract negotiations.
- Pilots from its three airline subsidiaries are merged in a single common seniority list and are represented by the Air Line Pilots Association (ALPA). Its contract was ratified in December 2008 and becomes amenable in December 2010.[20]
Mesa Angels Foundation
Mesa Air Group, Inc. sponsors the Mesa Angels Foundation which provides financial assistance to those Mesa employees and immediate family members in critical financial need due to extraordinary circumstances such as medical emergencies, natural disasters or other unforeseen life-changing events. Mesa Angels Foundation also supports charitable organizations through donations in the communities Mesa serves.
References
- ^ "Form 10-K (2006)". Retrieved 2007-09-05.
- ^ "Contact Us Archived 2015-02-08 at the Wayback Machine." Mesa Air Group. Retrieved on January 30, 2009.
- ^ "Mesa Air Group Inc Profile". CNBC.com. Retrieved June 8, 2022.
- ^ http://www/mesa-air.com, About Mesa, History
- ^ Mesa Airlines timetable, October 15, 1987
- ^ Timetables from Mesa Airlines, United Airlines, and US Air
- ^ American Express Skyguide, March 1998
- ^ "Hawaiian Airlines sues Mesa". USA Today. February 15, 2006.
- ^ "Aloha Airlines sues Mesa Air Group". Pacific Business News. October 13, 2006.
- ^ "Mesa Air Group News Release". September 21, 2007.
- ^ "Judge rules Mesa destroyed evidence". Pacific Business News. September 27, 2007.
- ^ "Mesa Air ordered to pay $80M for misusing confidential info". AzBiz.com. November 2, 2007.
- ^ "Aloha shuts down service". Maui News. Retrieved 2010-10-16.
- ^ "Mesa Air Group Settles Aloha Lawsuit and Agrees to Enter Long Term Licensing Agreement". Mesa Air Group. Retrieved 2010-10-16.
- ^ Daysog, Rick (May 16, 2009). "Mesa can't use Aloha name". The Honolulu Advertiser. Retrieved 2010-10-16.
- ^ [1] Archived July 20, 2011, at the Wayback Machine
- ^ Maxon, Terry (2010-01-05). "Mesa Air goes into bankruptcy court". The Dallas Morning News. Retrieved 2010-01-05.
- Phoenix Business Journal. March 1, 2011. Retrieved March 2, 2011.
- ^ Segal, Dave (June 21, 2012). "Airline's parent sheds less-than-sleek name and returns to 'go!'". Honolulu Star-Advertiser.
- ^ "Mesa Pilots Ratify New Contract with Significant Gains". Air Line Pilots Association. Retrieved 2010-10-16.
Sources
- Graham, Rex (March 1, 1987). "And the Winner Is ...". New Mexico Business Journal. 11 (3): 17.
- Marcial, Gene (July 17, 1989). "Is Mesa Airlines Facing a Dogfight?". BusinessWeek (3115). McGraw-Hill, Inc.: 130.
- "Mesa, Air Wisconsin to Split Aspen Airways Service". Aviation Daily. 299 (35). McGraw-Hill, Inc.: 347 February 20, 1990.
- Henderson, Danna (September 1, 1990). "Mesa Airlines Embraces Code Sharing". Air Transport World (178). Penton Publishing Inc.
- "Mesa To Consolidate Operations Under Holding Company". Aviation Daily. 307 (2). McGraw Hill, Inc.: 11 March 1, 1992.
- Kidder, Peabody & Co. Inc. (September 13, 1991). "Mesa Airlines Company Report 1991". The Investext Group.)
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(help - Prudential Securities, Inc. (May 3, 1992). "Mesa Airlines Company Report 1992". The Investext Group.
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(help) - First Boston Credit Suisse (August 4, 1993). "Mesa Airlines Company Report 1993". The Investext Group.
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(help) - Mesa Air Group (December 15, 1995). "1995 Annual Report".
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(help) - Mesa Air Group (December 26, 1996). "1996 Annual Report".
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(help) - Mesa Air Group (January 13, 1998). "1997 Annual Report".
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(help) - Mesa Air Group (December 17, 1998). "1998 Annual Report".
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(help) - Mesa Air Group (December 31, 1999). "1999 Annual Report".
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(help) - Mesa Air Group (December 26, 2000). "2000 Annual Report".
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(help) - Mesa Air Group (November 12, 2001). "2001 Annual Report".
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(help) - Mesa Air Group (December 6, 2002). "2002 Annual Report".
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(help) - Mesa Air Group (December 8, 2003). "2003 Annual Report".
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(help) - Mesa Air Group (December 1, 2004). "2004 Annual Report".
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